I'm trying to crack into the real estate business. I have a real estate license in Michigan and $2,000. Where do you guys think I should start?
I think that $2,000 isn't going to go very far, but if you start working with clients you may be able to save up a bit more and get enough for a down payment on either a flip or rental property in your area.
Hi @Keith Burton ,
I agree with @Aaron Klatt , you still need to save some more before diving in quite yet. Keep growing your client base, networking, learning, and saving.
I would recommend starting with a house hack or live-and-flip. There are a lot of great deals right now in Pontiac, you should be able to find something. Best of luck!
I agree with @Aaron Klatt. While there are low and no money down options, that's the easy part. You need savings to protect you from vacancies and unexpected repairs.
what about wholesaling? Do you guys recommend it or do you think I could put the $2,000 into my agency advertising for better returns based on the numbers.
Network and educate! Get some experience managing properties, try property management (be sure to check your local laws with that).
@Keith Burton Consider house hacking if you are in a position to do so.
@Keith Burton Don't do anything. Stick it in a savings account. $2,000 isn't even close to the amount you should have in reserves. And that's not even addressing the potential for a down payment. Focus on building your career as a real estate agent.
I agree that $2,000 won't get you much in terms of traditional real estate, unless you're getting creative with Subject-To or another low or no money down strategy. But to many people's points above, reserves are still critical so not sure if you have those outside of the $2,000 of investment capital.
Now if you want to start making money on that $2K today, you could also try P2P Lending. Sites like Lending Club allow you to lend money via unsecured notes (or partial notes) with as little as $25/per investment. Everyone's return will vary based on their lending strategy but I've seen a steady return between a 10%-12% with my P2P investments. Keep in mind these notes are unsecured so they're not collateralized by hard property but with such a low investment price point you can really spread out your risk. May be something worth looking into.
How come no one mentioned about investing in the stock market?
The recent Bigger Pockets book Set For Life comes to mind. If you don't have time to read the whole book, I recommend listening to the podcast that outlines the main points (episode 223) or search the blog for similar content. You will find advice about reducing your own expenses so your savings grows fast, being in a career that has opportunity for advancement (you are!), and early investing. I so wish this book was written 20 years ago! Best wishes!
$2,000 isn't even an emergency fund. Save up 6 months expenses, put them in a money market account, then you could start taking additional income and consider investing in ETFs or something to help you hit a down payment a bit more quickly.
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