What should my next step be?

13 Replies

Hi everyone! My name is Kevin Tunnell and I am new to Bigger Pockets. I just started my first (what I like to call "Big Boy Job") and am trying to save up to make my first real estate purchase. I am 23 and live at home with my parents in Napa, CA to help cut down my expenses. I have no debt aside from a car payment that is a little over 200$ a month. My net income is somewhere in the ballpark of 4000-5000$ a month. Seeing as I work in the Bay area, I'm thinking it may be best to look for either a duplex, triplex or 3 bed/ 2 bath home on the outer edge of the bay area (somewhere still commutable) to purchase. Another option I'm thinking of, is purchasing property out of sate and remaining at home as long as my parents allow it. My next question is, would it be better to pay my car off ASAP, or live with the car payment and begin saving for my down payment, closing costs, etc. for the real estate? I'd like to make a purchase within the next 1-2 years so maybe best to keep my cash in a normal savings account with the local credit union for liquidity? Any and all advice is happily accepted here!  

Kevin,

You only need $17,500 for the down payment on a $500,000 based on the info above you should be able to save that in a matter of months. Plenty of deals in that price range in Napa and within an easy 15-mile radius. Keep it simple

@Mike Bolen

Hey Mike, thanks for the reply! Assuming I only put 3.5% down, I see now that I could have a down payment within a few months. I only worry about how well a property in the North Bay will Cash Flow seeing as my mortgage would be higher with such a low down payment. I have looked at a lot of properties in the Vallejo area that are certainly affordable. I know there’s some good and some not so good neighborhoods there. Thoughts?

Start reading books and get educated! I highly recommend reading all of Ken McElroys ABC’s of real estate investing books. He has good content as does YouTube on how to pick your market and understand the process. Understand demographics and where people are moving. A single city can have numerous markets inside of it. Start learning now while you are saving up so you can make better decisions when time comes. 👍🏼  and start crunching numbers and get comfortable with analyzing deals. It’s nothing difficult, just something new to learn.

I love Vallejo. The sweet spot is Mare Island and the waterfront district along Wilson Street and up the hillside a few blocks. I feel this area will be $1M+ in less time than most people believe. 

@Sean Resavy

I see, so not only will markets differ between states, counties, etc. but ALSO within a city in of itself. I’m guessing something like, nicer/ quieter neighborhoods will be priced higher. I definitely need to read up on how to analyze deals and understand the mathematics behind them and not just assume since something is priced low that it’ll be a good deal. And I just got ABC’s of real estate the other day so I will read it soon, any other books that come to mind, I’d love to hear about them! Thanks again for the reply!

Books I highly encourage reading if you haven’t already:

Books for learning about real estate

-  Rich Dad Poor Dad- Robert K.

-ABC’s of buying Rental Property

-ABC’s of investing in real estate

- Advanced guide of investing in Real Estate - all by Ken MC.

BRRRR Investing by david Greene of course

- you should also be reading personal development and mind set type books as well

4 hour work week - Tim F.

10x - Grant Cardone. ( it’s a bit agressive but really good takeaways)

Mitas Touch by Donald and Robert

How to win friends and influence people- dale C.

Strait path  to real estate by kris kroon is an easy way to understand lease options

Limitless by Jim kwik 

Your next 5 moves - Patrick Brt-david 

I know it sounds like a lot but if you wanna be in the 1%, you must do what the other 99% won’t. And that means less video games and more reading. And I promise you if you read just these books alone you’ll be ready to take the bull by the horns with confidence!! 

Originally posted by @Sean Resavy :

Books I highly encourage reading if you haven’t already:

Books for learning about real estate

-  Rich Dad Poor Dad- Robert K.

-ABC’s of buying Rental Property

-ABC’s of investing in real estate

- Advanced guide of investing in Real Estate - all by Ken MC.

BRRRR Investing by david Greene of course

- you should also be reading personal development and mind set type books as well

4 hour work week - Tim F.

10x - Grant Cardone. ( it’s a bit agressive but really good takeaways)

Mitas Touch by Donald and Robert

How to win friends and influence people- dale C.

Strait path  to real estate by kris kroon is an easy way to understand lease options

Limitless by Jim kwik 

Your next 5 moves - Patrick Brt-david 

I know it sounds like a lot but if you wanna be in the 1%, you must do what the other 99% won’t. And that means less video games and more reading. And I promise you if you read just these books alone you’ll be ready to take the bull by the horns with confidence!! 

 I

How many properties have those books helped you purchase?

@Kevin Tunnell  There are a lot of people out there like Michael P. that are fishing for an opportunity for them to tell you how awesome they are and how many deals they have done. As you begin your real estate journey be cautious of people that try to sell you and push themselves on you. Good luck out there and feel free to reach out if you have any questions!

Welcome Kevin!  Yes, it is still all about location, location, location.  Research your neighborhoods!  You may want to consider Fairfield as well?  It is an easy commute to Napa, and still has property within your price range in good neighborhoods that will appreciate nicely.  It sounds like you are getting your ducks in a row early.  Good for you,  and happy hunting!  :)

-Lauren

@Lauren Heart

Thanks for the advice Lauren! Unfortunately, I work in Hayward so I’d still have a bit of a commute if I were to go to Fairfield. But if the deals are there, then I guess I better give it a look! And yes, my Grandfather always told me that his only regret with investing in general is that he wished he would’ve started sooner, so I’m taking his advice and getting started as soon as I can.

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