New REI that's trying to figure out where to start here.
Member since 2022 · 6 posts · 4 votes
I'm exceedingly excited to join this community and learn all I can. Unfortunately, I find myself already a bit overwhelmed. My initial goal is to learn what I can in order to set the ground work for making my first investment in the next 90 days. Looking around the site and education tabs doesn't seem to have a very clear cut path of where to begin. I find myself seeing advice like, "let my Realtors and property managers know what I’m looking for," which is great advice if I had realtors and property managers. It seems like I've skipped a step somewhere or missed a link? Would greatly appreciate any advice or recommendations on the order of things for one trying to pursue multi-family rental properties in order to generate cash flow.
Thank you for your time.
Hi Zachary! Welcome to BP. And your feeling is not uncommon. It is very very easy to end up in information overload. First, I am going to tell you there are TONS of ways to invest in real estate, and buying properties is just one very very tiny piece. For example, you could get involved in note buying and selling. You could broker for hard money lenders, you could develop connections with capital partners and set up syndications to buy large properties such as multifamily and office space. You could open a dinosaur themed hotel (life goal lol). But you are seeing just the tip of the iceberg with talking to realtors and looking at homes and small multifamily. My suggestion is going to be to sit down and think. Don't look at social media, put your phone away. Get a piece of paper and a pen (yes those still exist! lol). Write at the top "Why do I want to invest in real estate?" And then write down a reason. Now ask WHY is that reason important to you. Keep doing that until you realize what you are truly after. As an example, "Why do I want to invest in real estate?". I want to have $10,000 in passive income. "Why do I want 10,000 in passive income?", because I want to leave my job. "Why do you want to leave your job?" Because I don't like the work I do, I don't find it fulfilling and my boss drives me crazy. "Why do you want something in your life you find fulfilling" . I want to be happy. Will $10,000 a month make you happy? - No- ok. What makes you happy? Being able to do what I want when I want will make me happy. AND THERE IT IS, the root cause. You keep asking yourself why until you come to a root reason. The reason isn't $10k a month. The reason is you want time freedom, or geographical freedom. NOW you can look at the variety of ways of investing and decide which ones get you closer to that goal. Being a full time fix and flipper is going to be very difficult on you if you want time freedom or geographical freedom for example. Next, I would then take out another piece of paper and write down what your positive attributes are and what skills you have and enjoy doing. For example, are you more introverted and really great with analysis and numbers? Or are you extroverted, love to connect with people and discuss hypothetical situations at a high level? Now you can narrow down the choices even more! After this exercise you should be left with just a few options, and if you are still unclear start reaching out to people who do those options. Don't ask them the mechanics of it (you can find that on YouTube), ask them what their lifestyles are like, ask them what they wished they knew earlier, ask them if they would do it all over again, ask them if they would keep doing it if they didn't need the money. Whoever has the answers that resonate with you, THAT is the style of investing you should move towards. Good luck!
Hi Zachary! Welcome to BP. And your feeling is not uncommon. It is very very easy to end up in information overload. First, I am going to tell you there are TONS of ways to invest in real estate, and buying properties is just one very very tiny piece. For example, you could get involved in note buying and selling. You could broker for hard money lenders, you could develop connections with capital partners and set up syndications to buy large properties such as multifamily and office space. You could open a dinosaur themed hotel (life goal lol). But you are seeing just the tip of the iceberg with talking to realtors and looking at homes and small multifamily. My suggestion is going to be to sit down and think. Don't look at social media, put your phone away. Get a piece of paper and a pen (yes those still exist! lol). Write at the top "Why do I want to invest in real estate?" And then write down a reason. Now ask WHY is that reason important to you. Keep doing that until you realize what you are truly after. As an example, "Why do I want to invest in real estate?". I want to have $10,000 in passive income. "Why do I want 10,000 in passive income?", because I want to leave my job. "Why do you want to leave your job?" Because I don't like the work I do, I don't find it fulfilling and my boss drives me crazy. "Why do you want something in your life you find fulfilling" . I want to be happy. Will $10,000 a month make you happy? - No- ok. What makes you happy? Being able to do what I want when I want will make me happy. AND THERE IT IS, the root cause. You keep asking yourself why until you come to a root reason. The reason isn't $10k a month. The reason is you want time freedom, or geographical freedom. NOW you can look at the variety of ways of investing and decide which ones get you closer to that goal. Being a full time fix and flipper is going to be very difficult on you if you want time freedom or geographical freedom for example. Next, I would then take out another piece of paper and write down what your positive attributes are and what skills you have and enjoy doing. For example, are you more introverted and really great with analysis and numbers? Or are you extroverted, love to connect with people and discuss hypothetical situations at a high level? Now you can narrow down the choices even more! After this exercise you should be left with just a few options, and if you are still unclear start reaching out to people who do those options. Don't ask them the mechanics of it (you can find that on YouTube), ask them what their lifestyles are like, ask them what they wished they knew earlier, ask them if they would do it all over again, ask them if they would keep doing it if they didn't need the money. Whoever has the answers that resonate with you, THAT is the style of investing you should move towards. Good luck!
Thank you for the in-depth response it was very insightful. My knee-jerk response is to agree with the example you gave. Having the time freedom to do what I want, when I want, military permitting.
I hadn't thought about breaking down the types of investing into categories like that in order to better direct my attention so I'll be going back to the drawing board and using your advice as a spring board to figure out what truly fits me best. Thank you again for taking the time.
@Zachary Resendez Welcome to BP!
Before you start your RE journey, you need to make sure your personal finances are strong. Questions to ask yourself include: What's my credit score? Do I have cash reserves set aside for unexpected expenses? Do I have enough W-2 income to qualify for a mortgage for an investment property? (a lender can help you with that one.
Also, what are your long-term goals? How will you know what RE strategy to use, and what asset class to use, if you don't know what your goals are?
Good luck and keep us all updated on your progress!
I believe I do at least while I'm on active duty orders for the income and credit score. I'm also planning to use the VA loan which has it's pros and cons but I feel is the best option initially, and a way to get the most out of my time in the Army.
After reviewing and taking into consideration the advice @Alex Breshears gave I've come to the conclusion that what I want for my first property is a Owner-occupied multi-family long-term rental property for when I get out of this training. That's the short term goal of course as I will need a place to live, while the long term goal is to to scale my portfolio in the Birmingham, and other, areas to generate enough cash flow to afford me time freedom.
I appreciate the advice and I'll be sure to post progress as I'm sure that'd be a great way to keep me focused as well though is there a specific place to post stuff like that or should I just post it in this forum?
@Zachary Resendez so now that you know exactly what you are looking for and the area get out and start networking with realtors and lenders. Figure out what you can afford and then start looking at some properties to narrow it in even more.
The reason you won’t find an exact list of steps to take and it can sometimes feel like you missed a step somewhere is that everyone has a different path. There are tons of ways to invest in real estate and everyone does it differently. Just start taking steps and you’ll start seeing what else you need to do.
Hi Zachary! Welcome to BP. And your feeling is not uncommon. It is very very easy to end up in information overload. First, I am going to tell you there are TONS of ways to invest in real estate, and buying properties is just one very very tiny piece. For example, you could get involved in note buying and selling. You could broker for hard money lenders, you could develop connections with capital partners and set up syndications to buy large properties such as multifamily and office space. You could open a dinosaur themed hotel (life goal lol). But you are seeing just the tip of the iceberg with talking to realtors and looking at homes and small multifamily. My suggestion is going to be to sit down and think. Don't look at social media, put your phone away. Get a piece of paper and a pen (yes those still exist! lol). Write at the top "Why do I want to invest in real estate?" And then write down a reason. Now ask WHY is that reason important to you. Keep doing that until you realize what you are truly after. As an example, "Why do I want to invest in real estate?". I want to have $10,000 in passive income. "Why do I want 10,000 in passive income?", because I want to leave my job. "Why do you want to leave your job?" Because I don't like the work I do, I don't find it fulfilling and my boss drives me crazy. "Why do you want something in your life you find fulfilling" . I want to be happy. Will $10,000 a month make you happy? - No- ok. What makes you happy? Being able to do what I want when I want will make me happy. AND THERE IT IS, the root cause. You keep asking yourself why until you come to a root reason. The reason isn't $10k a month. The reason is you want time freedom, or geographical freedom. NOW you can look at the variety of ways of investing and decide which ones get you closer to that goal. Being a full time fix and flipper is going to be very difficult on you if you want time freedom or geographical freedom for example. Next, I would then take out another piece of paper and write down what your positive attributes are and what skills you have and enjoy doing. For example, are you more introverted and really great with analysis and numbers? Or are you extroverted, love to connect with people and discuss hypothetical situations at a high level? Now you can narrow down the choices even more! After this exercise you should be left with just a few options, and if you are still unclear start reaching out to people who do those options. Don't ask them the mechanics of it (you can find that on YouTube), ask them what their lifestyles are like, ask them what they wished they knew earlier, ask them if they would do it all over again, ask them if they would keep doing it if they didn't need the money. Whoever has the answers that resonate with you, THAT is the style of investing you should move towards. Good luck!
@Alex Breshears Great advise!
I am new to REI and I have had to go back to my why, look at my stated goals and go back to my business plan plenty of times. Zachary, the key is consistency and to push through the dissapointments. They will happen, but stay focused. I am two properties in and continuing to look for my first commercial deal. I have taken my goal of helping tenants, lenders, borrowers and other investors to heart and that has given me the drive to try new things with others in mind.
Remember, this is the long game. "If you aim at nothing, you'll hit it every time." Not sure who said it, but it is one of my favorite quotes. Stay the course, remember your why, or find one if you haven't already. Write down your goals and keep at it. Happy to chat if you need some encouragement.
Good luck
I believe I do at least while I'm on active duty orders for the income and credit score. I'm also planning to use the VA loan which has it's pros and cons but I feel is the best option initially, and a way to get the most out of my time in the Army.
After reviewing and taking into consideration the advice @Alex Breshears gave I've come to the conclusion that what I want for my first property is a Owner-occupied multi-family long-term rental property for when I get out of this training. That's the short term goal of course as I will need a place to live, while the long term goal is to to scale my portfolio in the Birmingham, and other, areas to generate enough cash flow to afford me time freedom.
I appreciate the advice and I'll be sure to post progress as I'm sure that'd be a great way to keep me focused as well though is there a specific place to post stuff like that or should I just post it in this forum?
You can always post to the forum with updates, or send members a message directly. I really enjoy seeing where people start and their journey along the way so don't be a stranger!
It’s great to have you on the forums!
This site is great if you are looking to invest into real estate.
There are a few self-contained guides that you can access here: https://www.biggerpockets.com/guides
I really like the alerts feature that can quickly guide you to current topics that might interest you: http://www.biggerpockets.com/alerts
Welcome @Zachary Resendez!
Great to have you in the BP family and excited to see the "Birmingham, AL" tag. Not sure if you're local here in Birmingham or looking to invest remotely, but either way let me know if you ever want to grab a coffee (in-person or virtually) and chat.
Great advice from fellow BP members above, sounds like you've got some solid direction there. Shameless plug for BP but the "Book on Rental Property Investing" is phenomenal, and can be a guide for newbie and experienced investors alike.
Like others have shared, a few critical steps on the front end:
1. WHY - figure out your why, be as specific as possible
2. Finances - Know where you stand, where you want to be, and identify any gaps in between. Credit score, cash reserves, current assets, etc. *Note: you don't need to have a ton of cash reserves to get started, but you do need to know where you stand.
3. NETWORK - Lookup local FB groups for your target market ("Birmingham RE Investors", "Alabama Investing", "REI", etc.). Call realtors and property managers to get a feel for the area and ask to meet for coffee or lunch. Keep leveraging BP, there's more knowledge/experience here than anyone could take in in a lifetime. Go for it!
If you just dedicate your time and efforts to those things now, the other stuff will come.
Look forward to seeing your progress here!
I'm exceedingly excited to join this community and learn all I can. Unfortunately, I find myself already a bit overwhelmed. My initial goal is to learn what I can in order to set the ground work for making my first investment in the next 90 days. Looking around the site and education tabs doesn't seem to have a very clear cut path of where to begin. I find myself seeing advice like, "let my Realtors and property managers know what I’m looking for," which is great advice if I had realtors and property managers. It seems like I've skipped a step somewhere or missed a link? Would greatly appreciate any advice or recommendations on the order of things for one trying to pursue multi-family rental properties in order to generate cash flow.
Thank you for your time.
Welcome @Zachary Resendez!
Great to have you in the BP family and excited to see the "Birmingham, AL" tag. Not sure if you're local here in Birmingham or looking to invest remotely, but either way let me know if you ever want to grab a coffee (in-person or virtually) and chat.
Great advice from fellow BP members above, sounds like you've got some solid direction there. Shameless plug for BP but the "Book on Rental Property Investing" is phenomenal, and can be a guide for newbie and experienced investors alike.
Like others have shared, a few critical steps on the front end:
1. WHY - figure out your why, be as specific as possible
2. Finances - Know where you stand, where you want to be, and identify any gaps in between. Credit score, cash reserves, current assets, etc. *Note: you don't need to have a ton of cash reserves to get started, but you do need to know where you stand.
3. NETWORK - Lookup local FB groups for your target market ("Birmingham RE Investors", "Alabama Investing", "REI", etc.). Call realtors and property managers to get a feel for the area and ask to meet for coffee or lunch. Keep leveraging BP, there's more knowledge/experience here than anyone could take in in a lifetime. Go for it!
If you just dedicate your time and efforts to those things now, the other stuff will come.
Look forward to seeing your progress here!
Thank you and I'd love to meet up when I'm back in Birmingham. Currently down south for training but will be moving back there in a few months. I actually just picked up " The Multifamily Millionaire," but I'll definitely have to check that one out as well. Learning all I can and thankfully have Veteran's United helping me out as well and I have to say, it feels really good to even just be getting the process started, despite being inundated with info. I can't wait to see where this path takes me and as far as meeting up I suppose I'll DM you the next time I'm up there or when I move back. Whichever comes first.
Cleared the first hurdle on acquiring a loan. Preapproved for up to 400k but now the next hurdle has already come into play. MLS only came up with 18 properties that fit my criteria, two of which I can't use the VA loan on unfortunately. Is there a forum for connecting with wholesale dealers or the like in and around Birmingham or should I be contacting other realtors to see what they have available? Obviously their MLS search will just bring up the same thing but do realtor's keep separate inventories off the MLS?
Next step is definitely learning all the ways I can increase my options available. Only a fifth of the way to 100 to even find one but just wanted to update anyone following this, as well as have a record for myself. Also I appreciate all the advice I've received. It has greatly helped to plot a path for my research into multi-family properties.
Next major milestone reached and new problems abound. I've managed to find a property, make and offer, and start the 30 day process which is great and also somewhat bad. Reason being due to some miscommunication about my active duty status I have now essentially given myself a deadline to have a job offer lined up before the 30 days are out for proof of income for when my active duty orders end and I switch back to regular National Guard. Thankfully I was already in the process of doing this since I needed one anyway, I just don't have until I graduate this school anymore.
I'm not entirely sure how many people will see this or if I should maybe create a new post all together, but I would greatly appreciate any recommendations for a job in Birmingham AL. I'm an officer in the Army and come from an economics background and with being in the Guard will be able to work for typically 3 out of the 4 weeks of every month after accounting for my military commitment.
As far as the house goes, next steps are signing all this paperwork, getting it inspected, proof of income, and so on and so forth. I must say, Veteran's United's system is, thankfully, very intuitive and is greatly working to streamline this whole process.