Almost time to buy my first rental!

21 Replies

Hello everyone! 

So It's almost that time! I'm turning 18 December 20th and looking to purchase my first rental property soon after that! 

I know what your thinking.....There is no way! When you want something bad enough you will do anything it takes! I have done years worth of research so I think I know a good amount about real estate and can't wait to start investing! 

I have met some awesome people while doing my research maybe even potential business partners. But if that doesn't work out I have a question for you guys.

Since I'm only going to be 18 its going to be very hard to get a loan on a property. 

What would you guys recommend me to do? Seller financing?

I am talking with a bank right now that is seriously considering giving me a loan but if that falls through I would like to have a backup plan. 

I have started multiple companies over the years and instead of spending all the money I have been saving knowing that I wanted to invest in real estate as soon and I possibly could. 

How old were you when you bought your first investment property?

Thanks everyone for taking the time to read this post and any advice will help!

Can't wait to read your responses,

Have a great day!

Kyle

@Kyle Evans  

 Well played sir!

You want to stay in this game as long as possible. Time is on your side when it comes to finding the right deal, don't try to swing for the fences on your first property.

I was 27 when I bought my first property. The reason why I waited so long is that I thought RE investing in CA is impossible, but it isn't, you just need to look in the right areas and have a strong criteria.

Happy Hunting!

Good luck Kyle.  Positive thinking is very powerful.

Go with straight-forward conventional financing.  If necessary, find relative to co-sign.

I was in my late 30s when I bought my first investment property.  However, when I graduated from college, I had $50k in student loans and $25k in cash to invest or buy a home.  My first job out of college paid well enough to service all my debt but would have taken 2 years to save-up $25k.  Instead, I was able to immediately buy my own home rather than renting.  A lot of people hate student loan debt but it worked out well for me.

If you're going to college, consider taking (subsidized) student loans for as much as possible.  No payments and no interest until 6 months after graduation.  In fact, you could try to milk your friends to do the same (pay the a %) and then agglomerate the funds to make another purchase.  This isn't really a very good idea but it is a little fun to consider.  :)

Thanks for the response and advice @Raj Gandhi  

I really like the idea of having a relative co-sign on the property.  I will definitely talk to my parents about it and see if they are up for it!

I also really like your goal of 10 rental properties, How many do you have now?

Thanks again and best of luck to you!

Kyle

Thanks @Jordan Thibodeau  

I will be posting some of the potential properties here on biggerpockets to see what everyone else thinks of the numbers before I purchase!

Thanks again and best of luck to you!

Kyle

@Kyle Evans  , I've got five purposeful and profitable rentals.  #6 is is my former home (we moved a few months ago).  #6 looks bad on paper because I have lots of equity and am giving a discount to the current tenants.  They're friends and were willing to overlook some issues for a quicker move-in.  That worked to both our benefit.  Even at market-rate rent, debt service on #6 means weak cash flow.  It would be more logical to sell #6 and buy two quad-plex.  On the other hand, #6 was a 15 year loan with only 3.5 years remaining.  Cash flow will go way up when it is paid-off.  

@Raj Gandhi  Wow nice job! Sounds like you have a good plan for your 6th property. Look forward to following your journey and I hope you keep an eye on mine! 

Have a great night!

Kyle

@Marcus Johnson  Yes. I have been saving for awhile and comfortable spending a decent amount for a down payment!

I bought my first one in Nov/Dec of last year, then another one in June of this year, and we are trying to close on a duplex by Jan1. At the ripe old age of 26-27

@Andy Robison   That's not old! haha 

I really like your goal of 1 million a year. How many properties do you own at the moment?

Kyle

Currently we own 1SFH and a duplex. Trying to close on another duplex before the start of the year. After that we will be looking at adding a property every six months if possible.

@Kyle Evans  

Oh man, I'm sorry normally I try to type more than just a quick to the point answer. I've been at work for the past 12 hours and my mind stopped working. stood up got some Dr. Pepper and I'm alive!

I bought my first property with my family as a way for us to eventually be able to support our parents when they decide to retire. That being said my ambitions are much grander than just simply supporting my mom/dad as they age. So with the family we've purchased 1 property a SFH that is tossing off around $300/month cash flow. Then we are working with a gent that is not to awesome trying to buy a duplex from him that should cash flow about $600 a month in a high demand yet low income area. I'll post details when its under contract currently we are waiting on the seller to sign their side of the contract so we can dig into the numbers more throughly. Then of all the fun things that I have going on we might be taking on a fix and rent property as well. Still havent gotten enough time to work on the numbers for that property.
And then personally I have a duplex that I bought and am in the process of rehabing and flipping on top of my normal job of 40-60hrs a week.  The girlfriend is not a fan of this work schedule that I have but after just starting a new job I should have the extra funds from my w2 job to finish re-habbing the second unit and get it rented out by spring. Once that is rented, I will have a duplex that should be making me $400 after bills which is my personal forray into the RIE game.
1 Million is the goal, then once I get there then it will be 10 million, then eventually be a billionair and from there the world!... Alrighty back to installing patches.

@Andy Robison  

Wow your numbers look great! $300 and $600 cash flow!? That's awesome congrats on that. Do you manage these properties yourself or do you have a management company do the day to day work on the properties?

Is your long term plan to quit your job? If so I bet you can't wait! 

Good luck with everything and please keep me updated! 

Kyle  

@Kyle Evans I manage the properties myself. The end goal is to be able to quit my W2 job and become a full time LL. As it stands I manage the properties myself and when I get to a point where I dont enjoy it I'll be using a property manager.
So far I've only spent 5 hours at our first house one week dealing with a plumbing and power issue. Plumbing issue had to get a plumber out that could clean the main drain, pulled out about 3ft of roots in our main drain so that something we'll have to do once a year now.  All said and done it is not a time consuming process. Drive by once a month to make sure it hasnt burned to the ground and collect rents. I dont see my time going up more than 3-4 hours a month for the first 5-10 "doors" that we oversee. Just going to have to work on my orginzational skills here in the next few months or so.

@Kyle Evans, best of luck! If you are looking for a community to support you, I think you are in the right place. I think it is a great Idea to post the numbers in the units before making the purchase, at way you make sure you make all the numbers right and are in the best position possible :)

@Kyle Evans  I don't have much to add to the conversation, but I just wanted to say you are light years ahead of the game if you are planning your real estate investing future at 18.  Congrats!

To answer your questions, I was 24 when I bought my first investment property, but I bought mine with my parents.  Without their financial help, I would not have been able to do it.  You can look for seller financing, get a decent paying W2 job, save for a down payment and apply for a traditional loan, find a partner, etc.

Thanks for the comment @Dawn Brenengen  !

24 is still a young age to start. Congrats on that!

I've been saving for years now and have a good amount for a down payment. Just a matter of convincing banks to give me a loan without 2 years of Full time work. 

I will keep everyone updated on how the process goes!

Thanks again,

Kyle

Thanks @Edwin Broce  !!

I will definitely post all the numbers before making a purchase! :)

Have a great day!

Kyle

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