All Forum Posts by: Austin Smither Langley

@Ugo Duruike, you came to the right place! You can connect with other BiggerPockets members in the forums and at local REI events.

The key to success in real estate is connecting with others that can share their experience so that everyone wins.

You are correct.  Someone can buy stock (and property) on margin, but they technically need to put at least 50% in to buy stocks on margin and you can potentially put 0% down for real estate.

Is anyone aware of another asset class where you can potentially leverage debt to fund 100% of it?

@Mike Griffin in the grand scheme of things, real estate and stocks are actually not the safest investments.  There are other investments that can create a diverse investment portfolio to lower the risk of losing money.  If you are looking for the safest investment, invest in government bonds.  If you want to make money, you'll need to take some risk.  I'm no financial advisor, so I follow some of the best.

Below is the makeup of Ray Dalio's All-Weather Fund to mitigate risk.  My personal goal is to have an investment portfolio where 50% of it looks like the pie chart below and 50% of it is real estate.

 You gave 4 options and I chose D.  If they are looking for a highest and best offer, there is always the possibility of another bidder unless your offer  is accepted immediately.  They don't have to accept an offer at asking price.  Saying everyone would KNOW that it's worth $100k is a difficult situation to apply in the real world because the standard in real estate for value is price that a buyer and seller agree on (sold prices).  If everyone knows it's worth $100k (including buyers and the seller), then they would offer $100k and a $90k offer would be rejected by the seller in your example.

If you don't consider Option D a viable answer, then seems like you are looking for a perfect answer to apply to every situation and I simply don't believe that's the way to approach real estate.  The beauty of real estate is that you can get creative.  Every investor has different strategies.  I know some buyers that always offer below and they rarely get accepted but it's part of their strategy.  I also know investors that only come see properties if they are confident they can offer above asking price if they need to because it's such a deal.  The most successful investors I work with and learn from tailor their strategy to each unique situation and property.

Just my two cents.  Hope it helps.

@Prince Zachariah, welcome to BP.  It's never too early to start on the RE investing journey.

Deciding to use you saving for your own home vs. a rental property is more of a personal decision.  If you would rather live in your own home first, then that might answer your question.  Owning your own home can give you leverage to purchase your next property.

I know some real estate investors that prefer to rent their primary residence and enjoy the freedom to move around more, supplemented by income from rental properties.  It's just a personal choice.  If you're constantly moving for work right now, maybe buying a rental property first would make sense.

Depending on your amount of savings and relationships with lenders/partners, you may be able to do both.  The beauty of real estate is the ability to use other peoples money to fund it.

What markets in Texas are you interested in?

I'd take Option D and analyze the situation.  My answer to questions like this is almost always "it depends."

Option A may be necessary to lock in a property that has interested buyers.  You may be able to use more earnest money or a quicker close date to display confidence to the seller.

Option B may make sense if the seller has been trying to sell it for a while and/or you offer a quicker close date

Option C may be necessary if it's listed under market value and it's in a bidding war or they are taking "highest and best."  If it fits into your criteria, pay it.

One word: LEVERAGE

I don't think an ordinary person will find many lenders that will give them money to go invest in the stock market.

@Francois Frigon, sometimes lowering costs can be just as beneficial as increasing rents.  This property looks pretty new and clean, which means you'll have to get creative to add value or reduce costs.  Some potential ways that you can manipulate rent and costs include:

• Reduce vacancy using professional listings, photos, and showings (good first impressions increase tenants willingness to sign up to pay more rent)
• Metered utilities for each unit (make sure utilities don't cost you money)
• Including/covering landscaping and ext maintenance vs. making that the responsibility of the tenant
• Get creative and use one TV/Internet service account for the entire building and every unit to use (increase rent and reduce costs)
• You can charge more for month-to-month lease agreements than annual lease agreements

BP has an article here with some other ideas: https://www.biggerpockets.com/blog/13-ways-increase-rent-add-rental-property/

Hope that helps

@Roger Verastegui, Houston can be a great destination for out-of-state investors for a variety of reasons.

What types of properties are you looking for and finding available at $30,000?

As someone looking to get started, I'd recommend finding a source of deals (off-market) in Houston.  Working with them will allow you to see what other investors are paying for property in different areas and give you a reference point that others don't find on Zillow, HAR, etc.

As a long distance investor, you will need what the BP guys call your Core 4 (agent, lender, contractor, and property manager).  If you DM me, I can provide references for local agents, property managers, lenders, and contractors that many Houston investors use that can help you get started.