So far this month, three people have contacted me about their burning desire to get into fixing and flipping houses. “I see what you’re doing and I want in on some of that action!” Or so they say. “How can I get started, what steps do I need to take?”
Ah, but “will you follow the steps I give you” is the actual million dollar question.
I’ve been asked this often and, always looking for the best use of my time, I’ve developed a text file with a long answer to this exact question. Nowadays, I just copy and paste it for everyone who asks and, from their response, I can usually gauge where they stand and how serious they really are about real estate investing.
Not surprisingly the usual response sounds something like this…
I guess my text file answer isn’t a hit. But why is this? Why are so many people enamored with the prospect of making big, fast money but not ready to commit the time and hard work needed to get there? What answer were you expecting? No rose colored glasses here, bud. REI is hard work, especially in the beginning when you’re starting from literally ground zero: zero money, zero experience, zero credit.
But it’s not impossible and I know of many people who have found ways to get past that dreaded ground zero, myself included. You only have to leverage the ONE thing you do have at the early stages of your REI career and that is: persistence.
How to Purchase Real Estate With No (or Low) Money!
One of the biggest struggles that many new investors have is in coming up with the money to purchase their first real estate properties. Well, BiggerPockets can help with that too. The Book on Investing in Real Estate with No (and Low) Money Down can give you the tools you need to get started in real estate, even if you don’t have tons of cash lying around.
Persistance & Obsession : The Same Thing in my Book
What do I mean by this? Simple. When you’re first starting out and working from ground zero, you almost have to be obsessed if you want to make any progress. Think about it like this – there are thousands of people like you trying to get into the game. Only a select few will make it and those are the people who are the most persistent – and in my book, the most obsessed. Aim to work harder than the next guy; actually – scratch that – aim to work harder than everybody else in your position and you’ll almost guarantee your own success.
I think I slept for less than three hours a night when I first started. I did that for an entire month before I made my first deal. If I wasn’t reading, I was looking at houses or talking to Realtors, other investors, lenders, banks, posting on the BiggerPockets Forums.
When I took breaks I would watch Holmes on Homes, Flip This House, This Old House, etc. Believe it or not – I did even take a few golden nuggets of information from Armando: everything I shouldn’t do in a flip!
The take home point: I was obsessed!
However, reading and being informed is only half of the battle. Eventually you have turn off the computer, step foot out of your house, and take MASSIVE action.
Get out there and get uncomfortable. This is important: the more uncomfortable you are the more progress you make. Remember, you learn the most when you’re in situations you haven’t been in before.
Get Uncomfortable: The First Two Steps to Take
Step 1: Get a second job.
But wait… what?! I thought we were talking real estate here, Glenn? Well in fact I am and getting another job when you have zero money is probably the most important step you can take. Now you have to analyze your own situation (in my case I didn’t need another job, I just had to stop wasting money on toys) but the point I’m trying to drive here is that real estate investing requires money. Find it – get out there and do some old school hustlin’ if you need to – McDonalds is a famous REI stepping stone if you need ideas.
Are there creative ways to get into a deal with no money? Yes. Will you find one? Probably not. No guru stuff here, bud, it’s not that easy.
Step 2: Sell, Sell, Sell!
Are you buying designer clothes and wondering why you don’t have money to start investing? Are you driving a BMW and posting on BP that you have zero cash, zero credit? Are you looking at putting a 60 inch TV on a BestBuy credit card and wondering why you don’t have the credit to get a regular or hard money loan?
If you want to make money in real estate you have to get uncomfortable NOW in order to get comfortable later (Tweet This Quote!)
It’s not easy, and I told you so.
Still reading? Pat yourself on the back, many people have already stopped (right after step 1 is my guess) Anyway, I hope something has started to sink in. Read, get informed, network, and follow through on the above two steps and in a month you’ll find yourself closer to realizing your real estate dreams.
A lot of people don’t like to hear these two steps because a lot of people are simply not ready to be real estate investors. It’s not easy and it requires a lot of hard work to pull yourself up from ground zero. Once you do, though, things will start to speed up and the real fun starts. Until then – don’t skip out on steps 1 and 2 as they will set you up with a foundation that 99% of your counterparts won’t have.
Thoughts? Would any successful investor care to disagree? I’d love to hear stories where step 1 and 2 weren’t needed.
Photo: Crystian Cruz