I am just starting to look into investing in real estate but afraid that I won't make it and might end up failing with a lot of debt. I know researching helps minimize losses but just not sure where to start. Anyone mind sharing their stories?
When you say "investing in real estate" do you have a path in mind? For example, are you considering single family, multi family, commercial, ect? Being able to set your focus on one for the moment may help you when you begin your researching journey. You'll be able to filter out some of the information that doesn't apply to you just yet.
Thanks for replying. Well, I thought of starting with multi family homes like tri or quadplex and working my way up.
That will help. Some basic topics areas I would advise becoming familiar with are current market trends in your area for real estate, as well as financing opportunities that you'll be able to utilize (assuming you won't be paying straight cash for the property. For example FHA loans are available for multi family housing under 4 units but you must occupy one unit yourself. You may have heard the term "house-hacking" before, this is where you buy a multi unit property and live in one while your renters pay your mortgage and expenses for you. The benefit to financing with an FHA mortgage is the low down payment that's required (far less than the typical 20% down for a conventional loan, usually around 3-5% of the loan amount).
The property analysis calculator here on BiggerPockets will help you tremendously. Since there are so many numbers that go into analyzing a property, this resource will help keep the process as simple as possible while allowing you to see whether or not it's a viable investment option. The calculator will have you input amount for things like property taxes (which can be found on your county's website most times) property insurance (you can call any insurance agency and have them give you a quote on the property) and other factors such as vacancy rates, mortgage payment and property maintenance fees.
Start analyzing and then when you find a property where the numbers work, submit an offer on it.
I would start communicating with some of your local real estate agents now and let them know what you're looking for. Sometimes it takes talking to 3 or 4 agents before you find one you grove well with. They'll be the one to submit the offer on the property for you if it's listed on the MLS. Zillow is my go to when searching for properties but then again your area might offer RedFin which I've heard a lot of people speak highly of. The key is to just start looking at properties and becoming familiar with what's out there.
Wow didn't expect such detailed advise. Thank you! Will definitely look around
Hi Saemi, house-hacking is a great start. It's all about reducing your living expenses and it's a little less risky when you're living in your first investment. Feel free to message me directly if you have more questions about house-hacking, otherwise there are infinite resources on the web about it.
@Saemi Jung The beginning can be overwhelming to say the least there is ALOT of info out there and a ton of strategies. the best advice I can give you starting off is first to figure out what your goal is, you want to invest in real estate but to what end? Real estate is a great opportunity to build or preserve wealth, it can be a means to lower your housing costs, provide passive income, preserve and build on accumulated wealth or to help accumulate wealth. You can be active or passive, and there are a myriad of different ways to do both hence the overwhelming part. So again figure out what your goal is for your real estate journey, once you know where you want to be its easier to figure out how to get there.
As @Amber Forkey said Market research is key, the better you know the market you are operating in and who the players are the easier it will be to find what you are looking for and also know what you are looking at. Market research where tell you where you want to be and where you don't, and give you a good idea of what to expect out of a certain area or submarket, this will allow you to move quickly and surely when an opportunity presents itself.
Analyze everything, start looking at the properties you pass everyday, pick one and research it from address to strike price do this until you are able to get it done quickly and efficiently don't wait until there is a deal in front of you to try and figure out how to analyze it, its to late to figure out how that game is played and what numbers work and don't when the contract is in front of you do that home work before hand when the clock isn't ticking.
Finally this, Networking is key both online and in person, look into local REI groups and get active on the forums, get used to talking to people about RE and your goals. Reach out and touch everyone you can, Agents, owners, sellers, buyers and other investors do not solely rely on MLS and Zillow to find what you are looking for. You can absolutely find a deal on the MLS and Zillow but just remember so can everyone else and once it hits the market the price goes up! Ask questions, ask a lot of questions and read books that relate to your goal, I have found that most people in this game are super helpful and want to give back, all you have to do is ask. Always try to add value, give more than you take, follow up and follow through that's the key to networking and building relationships in this business.
If you take a look at my blog here on bigger pockets i have detailed how we find target properties, research and contact the owners, and get to and negotiate our deals.
Good luck on your journey I hope it all works out for you as i am sure it will, please don't hesitate to reach out in the future!
Listen to the BiggerPockets podcast! The podcast gave me a lot of confidence because many people from very different backgrounds made it into the real estate industry. If you don't like podcasts, you should check out their books! I am also happy to help with any real estate investing questions you may have.
I am getting started as well. My advice would be to read, listen to podcasts on REI, and to find people who are successful locally.
P.S. - Setting a goal helps a lot to keep you focused and motivated while you are learning. Best of luck!