I am a beginner who is looking for advice.

28 Replies

Hey @Devin Samuels , I live in North Carolina and I am new to real estate investing also. The main thing is to get in the education you need to get started. Decide what type of real estate you want to invest in whether it is single-family fix and flips, Single-family buy and hold or dive into multi-family investing. This site is a great place to start. If you are thinking about multifamily, read the book Multi-family millions by Dave Lindahl and also Check out Sterling White here on Bigger Pockets, he has a great story and he is willing to help out as well. Also, look into joining a local real estate investing group and start networking with like-minded people that may be willing to mentor you. Good luck!

Hey Devin good to see you are planning very early. I was in the military back in 1998 - 2001 and I wished I would have thought about investing in real estate back in 1998. Although I did use the VA Loan with no money down and paid my house within a few years. Then I read Robert Kiyosaki book and began investing in real estate. I then got a HELOC on my home and began buying homes. I recommend reading these forums because there are very intelligent investors here that give lots of good information, I learn a lot from these forums as well as the BP Podcast. I read David Greene book on the BRRRR, very good book. I also have a youtube channel.

Hey @devin, it is good to see young soldier like you that started to take care of yourself early in career. As a former U.S. Army service member, I would recommend you get familiar with VA loan while you're still in service and buy your first property through it(that requires no down payment) and live in it for a while. Once you finish the requirement of VA loan, you can then turn it over to a rental property. That can be a good start of your investing life.

Other than that, always take care of your credit score, and stacking up cash for future down payment. You'll be a millionare way earlier than your NCOs!

Good luck!

Originally posted by @Devin Samuels :

Thank you Brandon Pelfrey. I appreciate your advice sir. I was researching the basics of what to do when purchasing property and I wrote a list of things that would need to be taken in consideration. Can you give it a look over if you have the time? This is just a scenario that I brought up.

Home cost is $200000. Here is what must take into consideration.

1.Income:

Rental income=$2000

Laundry=0

Storage=0

Misc=0

Total monthly income:$2000

2.Expenses:

Tax:$150.00

Insurance:$100.00

Utilities: Electric, sewer, water, trash and gas:$0.00

HOA fees or Home Owner Association:$0.00( it will only cost nothing if the home is not located in a HOA area.)

Lawn care:$0.00

Vacancy:$100.00

Repairs:$100.00

Capital expenditures: $100.00

Property management:$200.00

Mortgage(only if you don't pay cash):$860.00

(Assumptions about mortgage:

Put down money for a down payment.

Get a $160000 mortgage with 5 percent interest in a 30 year span.)

Total monthly expenses:$1610.00

3.Cash flow:

Income:$2000.00

Minus expenses:$1610.00

Total monthly cash flow:$390.00

4.Cash on cash ROI or return on investment:

Down payment:$40000

Clothing cost:$3000

Repair money or rehab budget:$7000

Misc other:$0.00

Total investment:$50000

$390.00*12=$4680.00

Annual cash flow=4680

Total investment =50000

4860÷50000= 9.36 percent

Cash on cash ROI is equal to 9.36 percent.

 Hey Devin! On 2. I would look into "Mortgage" - usually that includes escrow, which is the holding tank for your taxes and insurance. You might need a full year of insurance up-front (~$1400 in my part of the Gulf Coast, and flood being additional). In your calculations, I wouldn't want you double calculating the insurance and taxes if your mortgage calculator already includes them. 

To explain differently, there is a chance that the mortgage calculator has the $860 mortgage as being the combo of mortgage, taxes and insurance in one. Just check your mortgage calculator. I didn't realize this and was running numbers on deals and it was kinda messy until I got it right. :)