5 Achievable Steps to Get Started in Real Estate With Little Money or Experience

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Real estate is “sexy” again, and lots of people are again dreaming of the good life by getting into real estate. Problem is, many of these folks have little money or credit and even less real estate experience. Don’t believe me? Go to any real estate club across the country or peruse the Forums on this website, and you will see and hear some form of the same question over and over again. How do I get started with no money and no experience? Well, I’m going to share the answer with you right now. The answer is: Find a good real estate deal.

If you find a good real estate deal, then doors will open up for you. People will likely be begging you to take their money and give them the deal, thus solving your money problem. What about the lack of experience? Well, experience is not necessarily needed to find a deal. Experience certainly helps, but you can learn what to look for and how to secure a deal just as easily as the next guy can.

Unfortunately, the answer I gave raises another, more complicated question, which is: “How do I find a good deal?” The answers to this question are, I think, what will put you on the road to real estate success and get you the money and experience you need.

So how do you find a good deal?

Related: Too Busy to Start Investing? These 3 Steps Will Help You Reevaluate Priorities

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5 Steps to Get Started in Real Estate With Little Money or Experience

Learn Your Market

Pick someplace you want to work in. It could be where you live. It could be the trendy part of town, or it could be near your place of work. Wherever it is, learn what properties in that area are selling for in tip top condition. Once you do that, say for single family homes, you have an idea of the average repaired value (ARV) in your market. You will need to know this information so you can spot a deal when it comes along or negotiate the purchase of a potential deal.

wholesaling-market-research

Network With Other Investors

Before you find a deal, you need to find people to sell it to. Find a way to network with other investors. Learn about the types of deals they are looking for. Learn about the areas they want to do business in. This step is important in two ways. First, you can tailor step one above to your investor customer’s needs. Second, you will need these other investors later on as we shall see.

Look Where Others Are Not

It is really difficult for the newbie investor to compete with more experienced investors on the open market. Homes listed on the MLS or in foreclosure notices simply have too many people looking at them. Competition for these properties can therefore be pretty fierce. You need to find the deals before others do and look where they are not. How?

  • Drive for Dollars: One of the best methods I have used to find deals is what is called “driving for dollars.” This technique has been explained elsewhere, and if you learn what to look for (tall grass, deferred maintenance, and a general unkempt look), it can really work. After driving you need to:
  • Send Marketing Letters: Just do something simple, like a handwritten letter on yellow legal paper. It does not have to be fancy or too wordy. Just say something along the lines of, “I noticed your property and I want to buy it.”
  • Repeat the Steps Above: Do this over and over again. Do not get discouraged if people do not respond to your first attempt. Sometimes it takes three or four times. Your phone will eventually start ringing.

Related: The Practical, 3-Step Way to Get Started in Real Estate With No Money

Learn How to Secure the Deal

Since you are new, with little money or credit, your goal should be to flip or wholesale the deal quickly to another investor who you met in step 2 for a fee. To be sure you collect your fee, you need to learn how to secure the deal, and that generally means getting the property under contract. Once you do that, you can assign your contract or have a double closing. Do not tell others about your deal without getting it under contract. There are lots of unscrupulous people out there. Also, don’t use a 30 page contract. A simple one or two-page form is just as, if not more, effective.

questions-commercial-broker

Collect Your Check and Repeat

Perhaps have a nice steak dinner to reward yourself for a job well done.

So there you have it, the answer to the question, “How do I get started with no money or experience?” Not the quick and easy answer that I bet some of you were hoping for, but nothing worth doing or having is ever really quick and easy.

Where are you in your quest to become a real estate investor?

Share your tips and experiences in the comments section below!

About Author

Kevin Perk

Kevin Perk is co-founder of Kevron Properties, LLC with his wife Terron and has been involved in real estate investing for 10 years. Kevin invests in and manages rental properties in Memphis, TN and is a past president and vice-president of the local REIA group, the Memphis Investors Group.

11 Comments

  1. Bill Gulley

    Sorry, but these blogs are laughable, no experience, no knowledge required.

    Just find what homes are selling for in top condition.
    How does a beginner find what they sell for or if they were in top condition? Most homes aren’t in “top condition” they are in marketable condition, is there a difference?

    Really, just learn the market, go find a deal, appraise it and figure out the costs, advertise, sell it, pick up your check, rinse and repeat!

    Not that simple. Sorry.

    I can understand gurus telling newbies that RE is simple, they just want to sell their product.

    I can’t understand any investor telling newbies what they do is simple, because it’s not.

    Common sense should tell people that if there is any business where you have the potential of making a good income or great money, that it isn’t going to be simple.

    Since P.T. Barnum said a fool is born every minute, I think the population has doubled, now it’s every 30 seconds.

    Learn real estate, get a license or take the comparable course, after that, then a newbie with some knowledge can follow these steps…….but then they already know this stuff by then.

    Sorry for the rant, but it’s the “how to get started” stuff, simplistic approaches that get newbies in trouble, legally and financially. 🙂

    • Anthony Casalone

      Billy–
      As a newbie I appreciate your comments. Anyone coming into REI with the idea that there is a rainbow with a pot of gold at the end if they just follow it is simply crazy. No one is good at something that they don’t know anything about. I would like to see more articles directing newbies to do research, read books, establish contacts with people in their area, get on multiple forums, groups, etc (even outside BP possibly).
      I’m very interested and excited about BP, but know that if it was just that simple, everyone would be doing it already. Do your homework first to make good moves.

  2. Charles Adams

    Hi BP family,
    I like the post for the simple reason it’s encouraging.
    I’ve been a carpenter all my life so I know when a home or building is in top condition from that point I’m good to go, knowing the top dollar in a neighborhood lets you know how good of a deal you’re getting on the property you’re wanting to do a deal on. I agree with the above posts’ belittling the go get em attitude because the knowledge I seek is the proper paper work that makes the deal ideal, and I’ve noticed here and on my REIA forum that there’s no talk about the most important part of this business the contracts. In mho the first course in any RE course should be contracts not knowing is what will get you hurt in this biz and it’s what has kept me from doing anything at all, I keep looking for the information I need but keep coming up empty handed.

  3. Andrew Harvey

    Hello everyone. Charles I feel as though I am in the same boat as you in understanding what brings value to a property. I am in construction and have been doing my homework in rei. Although I have been looking for the nuts and bolts of how a deal should be structured(legally) and beneficial to all parties. I’m thinking it’s best to get my real estate lic. first.

  4. Danielle Hammond

    The part about finding an investor to sell to is where I get lost. This is the process I think us “newbies” will find difficult. Do you find investors and tell them that you will find them a property, or do you find a property then tell the investor in hopes they will bite?. What if you find a property then sign the contract, then the investor doesn’t bite? Now you just convinced someone to sell you their property for cheap.. took up their time and energy.. then you back out? Say you get a property worth $150,000… for, let’s just say 100,000… what do you sell it to the investor for?

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