First thank you for reading. I really need your help and opinions. I'm 25, moved to Denver in February in hopes of selling my condo (which is mortgage free) back east and taking that money to start my own investing business. I came here for the excitement of a new city, cheaper real estate and taxes and just a fresh start to life. Unfortunately, my condo couldn't sell so recently I decided to rent it out at $1800/month. I thought okay..that sucks but maybe after a while I can go to the bank and get a HELOC. I then decided that i needed a job on the books (i've been bartending for the last 4 years) so with my stupid $100,000 degrees in business management and real estate, i'd go and find a job right? Wrong. Can't get ANYTHING. Not even Whole Foods or a bank teller position. I'm screwed.
Basically, i'm depressed and frustrated because nothing has worked out. I can't start my business and be like all you guys who I, in all honesty without sounding lame, really look up to. I want nothing more than to be my own boss and get started.
My question is this...do I move back to Jersey and try to dump the condo at a price way below what its worth just to get the cash to get started? I figure the "time value of money" method would say yes. Or do I go ahead and rent the place, move back and try to get a job, then try to get a HELOC down the road? Please help.
P.S. for those who have seen my posts before, I'm sorry if all I do is ask questions but it has been a VERY bumpy road for me so far - unfortunately my experience in real estate has not been as smooth as some of yours. With that said, i'm sorry but I can really use some help from you vets out there. Thanks.
Ryan, I have no doubt that everyone on this board has had bumps in their road to success. I know I have. A couple of years ago when the "easy financing" era came to an abrupt end, I announced to my family that I was going to hang up my real estate shoes and get a real job. I was very depressed. In the end I bucked up and realized that there are millions of ways to make money in real estate and I just had to find another way. So I put myself out there and started calling everyone I knew in the business. Through that, I met a guy who showed me how to flip. I was buy, fix, and refiying at the time.Things have worked out great since.
With regards to your condo, an asset is worth whatever the market will pay for it. You need to find out at what price that condo will sell for quickly. Then you need to accept that, and decide your next course of action. Will it be better to continue renting the condo, or can you take the proceeds from the sale and put them to better use. I am selling 3 rentals right now that I have about $100k into collectively. I am selling them for $50k because that's what they are currently worth and I can put that $50k to work better elsewhere. It's called sunk cost, meaning you should never consider what you paid for an aseet, only what that asset is worth to you now.
Anyway, I hope this helps. Now go to the Wynkoop and have a beer for me! I used to live in Denver and miss it alot.
i agree with ryan....if you owe no money on that condo, then any sales proceeds are capital to start your business despite what loss you may or may not have to take...i'd get over the psychological 'loss' on the condo, and use that cash to get it right this time...
Yes move back and sell the condo. Take care of one action at a time and you must sell condo first.
Use this time to research markets and make sure your next move is to a market where investments fit your model.
Make sure the place you pick you can cycle your capital and keep growing
Don't stress over this phase as it is always hardest to get started.
Be positive and you will be fine
Thank you guys, really appreciate your responses!
Just to throw another option into the mix Jersey has some expensive RE so depending upon what you want to do in RE could Denver be better for you? I'm saying this because you need to exhaust all options to stay where you want to be. I'd think bartending in a big city like Denver could be very lucrative and free up your daytime to do RE. Could you walk into the best bars/restaurants in Denver at Noon and ask the manager if you could demo your bartending skills if they get an opening?
You can sell your condo in Jersey not being there but I gather you are doing it so you are not paying rent in Denver especially without the income. So when it sells you go back to Denver? What's the plan? Any guarantees of a job in Jersey?
Just trying to shed some light on other options. That's all. I just went under Denver jobs on Craigslist and saw several bartender jobs in case you haven't checked there lately.
You hit it right on the head. I chose bartending because of the ability to work nights and leave my days for RE. I also planned on renting my prop back east at 1800/month which will easily pay my rent here. My plan was to do this for a year, get a job on the books in the meantime, and then hopefully either get a HELOC or after the year, sell the place and have the income needed to get a (very small) loan. I thought that was a good idea because it gives me time to get income on the books - something I don't have now. Thank you so very much for your input, it is greatly appreciated.
As for a job back in jersey, there is none which basically puts me in the same situation as here except no monthly rental payments (I'd live in my unit while its for sale). What do you think?
Have you tried to rent the condo and if so what have been the results? Rental markets are rather strong in most places right now.
You can get in the game wholesaling, bird dogging, etc. all of which don't require big $$ and can start that now. You might regret dumping the condo in exchange or a small loan.
If maybe you had a job lined up in Jersey it would make sense to pull the trigger now. I just sense there are few unturned stones you need to try first.
Go to bartender.org (just found it) and see if that association can help. What about a temp agency? Lots of those jobs turn into permanent? What about those bartending props (fake bottles) and walk into some bars/clubs and ask the manager if you could show him a thing or two on the fly? These guys are in Denver http://www.bartendersandmore.com/. Go start wholesaling and bird dogging right away.
If all else fails yes it's better to live rent free unemployed than paying rent unemployed. But, at the end of the day, the cash flow needs to start coming in so if you want to stay in Denver exhaust all options on the job front first.
You are a re investor !
An ok one too, your first deal is paying you in rents of approx 20k a year . I cant wait to get there!
When you really get going and youre the boss youll have alot more hair pulling to do fyi..
look at you rents as your income find a owner financing deal to work-into in denver..keep going.
Ryan: Sounds like you are doing many things right. Let me add my two cents to this discussion.
Consider having three jobs.
1. Get your real estate license. As a bartender you know how to connect with people. You know how to treat people. What you learn to get your license won't be very helpful but if you join a firm that educates you about the market you are ahead. Use your access to scour the MLS for deals you could be interested in. See what others are paying. Use your key to access properties often even when pending. Pay attention and you will know what is really happening in your market.
2. Be a great bartender. Work someplace where you get a chance to meet local people, not tourists. Tell everyone you meet that you are a Realtor but with the market the way it is you need two jobs. Ask them for their name and email and phone number. Keep in touch with them. Your real estate business will grow.
3. Real estate investor. You now are seeing the industry from the inside. You will soon learn who the good lenders are, which contractors to use, which inspectors to use, where to get the best price on carpet. You will learn this from other realtors and your clients. Always remember this is your primary job. This is where you can make money.
Like the others said sell you condo.
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you
Join the Largest Real Estate Investing Community
Basic membership is free, forever.