All Forum Posts by: Nicholas L.

@Beth Johnson OK - fair enough, I agree if you're a HNWI looking to diversify this could be an option.  But... most RE beginners (not all, but most) are not middle-aged HNWIs looking to diversify.

@Michele Velazquez

pick a market you can drive to

go to REIAs there

set up your core 4 there

@Marcos Carbi

OK - good luck and keep us posted.

@Brandon Collins

Reduce expenses

Save up funds

Get prequalified

Find real estate agent

House Hack

@Beth Johnson I'm curious - can you say about how much you made?  I would never recommend that a new investor become a private money lender.  Say you have $25K, and you somehow find someone trustworthy and get a 10% return - now after 6 months you have $26,250.  OK... that doesn't seem like a game changer to me.

Fortunately or unfortunately, the best way for new investors to save up money for real estate is... a job.

Need more info to help

Where located?

What are numbers?

Are you living in one?

@John Jasko

I am neither a real estate professional nor a CPA, but my understanding is that you are allowed to take the passive loss without being a real estate professional - but again, there is a cap, and it phases out as your income increases

The answers for anyone's specific situation lie in IRS Pub 925 or with a CPA

@Jeremy Suffel

Understood on the private money - if you move forward with something, just be sure to run all the numbers conservatively. I just did a BRRRR in Pittsburgh, and transacting in real estate is expensive.  It's just not possible to take your out of pocket costs to $0 - there are lots of things to pay for - closing costs, holding costs, insurance, financing costs, etc.

Whenever someone says "I'll start with a flip to make some money to invest!" I get nervous... although your personal background is certainly a huge risk mitigator here.

Good luck.

@Jeremy Suffel welcome to BP.  I'm outside of Pittsburgh - not too far from you in the grand scheme of things.  I saw your other post as well, and decided to do a joint reply here to both posts.  Some very miscellaneous thoughts and responses:

-I think getting started in flipping is very tough.  The best flippers are the professional flippers who have big operations.  One-offs are difficult.  And at the end you don't own anything.

-I saw in your other post that you can't house hack / live in flip.  That's fine.  Lots of other ways to invest.

-As others have said in this thread, setting up an LLC or corporation generally isn't all that important when you're getting started. But, if it's important to you, that's great. Talk to some professionals in your area and see what they think.

-You can use passive losses from real estate to offset W2 income even without any kind of sophisticated setup / having a corporation.  You just report the loss when you file your taxes.  There is a cap and it starts to phase out at $100K.  You can look up the IRS rules online or ask a CPA.

-Are you looking to buy and hold?  Do you have funds for a down payment for something + reserves?

-Are you working on a Core 4?  Are you attending meetups?

Hope this is helpful

@Marcos Carbi

did you make an offer?