Charlotte, NC · Member since 2014 · 241 posts · 21 votes
Many individuals new to real estate think wholesaling/bird dogging is the best entry to the real estate industry. Since the belief is taught you can save up through a few days while gaining experience. My experience had its ups and downs but was a good learning tool. So because of this I was wondering if any of the experienced investors could start their career over in real estate what would be your best entry into real estate?
Investor · Lusby, MD · Member since 2015 · 121 posts · 36 votes
11y
My experience is that becoming an agent is an exercise in money going out the door for a good bit. If you are short on $$ why become an agent first? It isn't an easy schooling to pass. You don't need to be an agent to wholesale, flip or buy a house. It DOES help to have an agent who is willing to work with you as an investor. I am an investor who became an agent because I couldn't find one who would work me. I can't address wholesaling because I've always been a buy (rehab) and hold.
Real Estate Broker · Bowie, MD · Member since 2014 · 242 posts · 44 votes
11y
You make great points. I am working to become an agent now as the agents I come across in Maryland are so set on conventional financing and do not open their eyes to the possibilities with creative financing. All in all, you made great points!
Rental Property Investor · Denver, CO · Member since 2015 · 154 posts · 266 votes
11y
In a very simplistic form- house hacking is a great method for first time investors. From my understanding it's purchasing a property (small multi-family or duplex seem to be the most common) of which you live in one of the units while renting out the other unit. So you're essentially living for free. Then once you've gathered more income, ideally you'd invest in another property and rent out the unit you were previously in.
Check out this linked article House-Hacking by @Brandon Turner should give you a clear sense of the benefits and ideals behind it! Good Luck!
could you expound when you say "creative financing" ?
Creative financing consists of seller financing, subject to deals, lease options, and others. Search on biggerpockets for creative financing and you'll see a lot of information on the topic.
Investor · Lusby, MD · Member since 2015 · 121 posts · 36 votes
11y
I became an investor by using a small inheritance to buy a little cottage close to me that needed a complete (COMPLETE) redo. We didn't plan to rent it - but put it together as a hideaway - that we never hid away in. To date the best thing about it is that it was a 15 year loan and we borrowed on it to invest in 2 more properties and against the equity in our principle home for 2 other properties. Again we didn't really plan on being investors - we bought houses to rent to our kids. When we die they get the house at market rate. In the meantime they pay us an agreed upon over mtg premium for their rent (still lower than market rent). Then we got hooked and got 2 more houses. (5 rentals in all). I became an investor by doing all the wrong things but I"ve learned as I've gone. 3 of my houses are where my son lives and he is instrumental in bringing them up to rentable and then managing them (and we pay him for that and still make money). This was never in my financial plan for lots of different reasons, the first being I didn't think we could get funding. I was wrong. Wish someone had told me that earlier! ;)
Residential Realtor · Leawood, KS · Member since 2014 · 47 posts · 13 votes
11y
@Chad K. I became an agent in 2007 and then started investing. I don't know if I could have successfully become a wholesaler/investor without the basic knowledge that I gained from being an agent. I'm still learning.
thanks for that info I have heard of those ways to finance I just never did any deep research on those subjects, but I will be sure too
No problem!!! I'm learning too, so once you complete a deal using creative financing, please come back to this post and acknowledge what was done to teach us newbies :)
Sounds like you made some good real estate mistakes :) thanks for sharing your story. I'm saving up as we speak with plans to JV with a local investor on a project an gain capital/experience so hopefully I can have a portfolio of properties in the future
Realtor · Colorado Springs, CO · Member since 2013 · 987 posts · 447 votes
11y
I would not become an agent first. I think you would be better off getting a 9-5 job first to create a cushion for yourself. There are just too many expenses to be an agent to be able to make it with no experience and no cash cushion or another job to supplement the income. I would second the house hacking. Your investing, making money, and living for free. It really doesn't get better than that!
Rental Property Investor · TN · Member since 2013 · 54 posts · 50 votes
11y
I see a lot in the BP forum about "house hacking" and don't really agree with the concept, especially in a 1-4 unit property. Ask yourself this; would you like your "tenant" to come knocking on your door during a Easter or Christmas dinner to tell you they're toilet is backed up, heater isn't working, hot water doesn't come, burner on stove is out, etc? Probably not. Also, if you have to evict, do you really want this pissed off "tenant" living right next door, I know I sure wouldn't. You would need the "ideal" tenant, and they can be a challenge to find sometimes.