Suggestions or recommendations for niches for beginners ?

1 Reply

The easiest niche or investment arena for you to start in is the one that you are actually interested in and enjoy. If you don't enjoy it, you won't be successful in the long run. Try one thing at a time and figure out what works for you. Everyone is different and what works for some may not work for you. Do a self assessment and take note of what your strengths are and what your weaknesses are, then determine how you can use those strengths to move you forward. Partner up with people are have strong points that you are lacking in or outsource them.

You need money to invest in real estate. There are lots of so called "gurus" (I use that term loosely) out there that will tell you you don't need cash to get started and you can do all this with no money down... that is simply just not true. You need money to start any business and real estate investing is no different.

Let's take flipping a house for example... 

If you can get a short term, interest only, adjustable rate mortgage from a local bank you will typically need 20% down on the total cost of the purchase price and rehab. For a 200k all in deal, you will need 40k, plus money to make the monthly interest payments.

If you can get hooked up with a private lender that will loan the money for the purchase price and rehab, they will typically want 10% down on the total (which is less than the bank), but they are going to charge about 10% interest and 2 points. So you are looking at 12% interest, where the bank may give you a 5 or 6% rate. In this scenario with a 200k all in you only need 20k down, but your monthly interest payments will be much larger.

There are countless other funding scenarios, but each one will require money.

If you have little to no money and are trying to get started in real estate investing then your best bet is to start off wholesaling and using your time rather than your capital. 

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

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.

We hate spam just as much as you