Not to toot my own horn here, but seriously, if you follow this guide you will succeed, no question. Well, assuming you actually make the effort, you really want to become a successful real estate investor, and you aren’t scared to work for it.
I’m basically going to spell out the process I followed (even though I didn’t know I was following it at the time), and I have no doubt that it can work for you, too. The nice thing about this process is it is completely neutral to whatever kind of real estate investing (REI) you want to do, and if you don’t know what that is yet, it will even help you find it.
The easiest way to be successful in REI is to do what comes most naturally.
Like I said, don’t worry if you don’t know what that is yet; you will find out if you follow this guide.
One last caveat: This guide does not support overnight success. Nothing in here is an overnight process, and it will take a good bit of effort, time, and patience from you. But don’t worry, those things pay off! I’d say this process for me happened over the course of 4-5 years, as I did it all on the side of my corporate job at the time, and even though that felt like forever, it’s paid off dividends since!
Ready? Let’s do it.
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.
4 Steps for Newbie Real Estate Success
Follow these steps, and I would be shocked if you don’t turn out a huge success!
1. Research EVERYTHING.
If you are just starting out, curious about REI and interested to get involved, you probably know very little about the ins and outs or truly understand the capacity of what all goes on in this industry. It’s a huge industry! You basically want to start reading everything you can get your hands on, reading blogs, listening to podcasts, looking up investment websites, going to local real estate club meetings or Meetup groups, and maybe even attending a couple short seminars (paying $500 for a weekend seminar is fine, but don’t spend $50,000 on a “pro” program just yet).
Things you will be hearing about, learning about, and getting a feel for may include:
- Different types/ways to invest in real estate
- What REI can do for you
- What kinds of offerings are out there for either investing itself or education
- What kinds of things other people are doing
- What resources are available to you
- Things to look for
- Things to watch out for
Hearing these types of things will go towards helping you with:
- Figuring out your own goals with REI
- Figuring out what niche(s) in REI will best help you towards your goals
- Figuring out your interests and what gets you excited
- Figuring out what kinds of things you will need to know in order to succeed
One trick that really helped me when I was in this phase was finding someone with goals and ideas that resonated with me. Once I’d find that person, I might begin reading more of their books, if they have more, or staying in contact with them if it was someone I met in person, or following their websites, blogs or whatever content they may have out there. For me, Robert Kiyosaki was someone I really agreed with. I wanted the life he promoted, and I agreed with his ideas on money principles, so I read as many of his books as I could get my hands on. Had BiggerPockets existed back then, I would have found a blog writer I really agreed with and read their articles every week, as another example.
One of my absolute favorite life quotes is “Don’t take advice from someone you wouldn’t trade shoes with!” and this very much applies here.
2. Select a focus.
I goofed on this part during my process. While I was in the “Research EVERYTHING” phase, and after it seemed to have gone on for an awfully long time, I realized that the reason nothing was panning out was because my focus was spread way too thin. I was learning a little about a lot, and I needed to switch to learning a lot about a little. It was time to pick a focus. If I didn’t, I’d keep learning so much about so many things that I’d never be able to get started on one thing.
Now, don’t cheat and rush the “Research EVERYTHING” phase with the excuse of needing to select a focus! Seriously, I’ll know (and you’ll know) if you do. On the flip side, you don’t want to wait too long to pick a focus either, or you’ll never get anything done. I wish I could give you a formula to follow when trying to figure out when best to make the switch, but listen to your gut and have it in your head about not shorting yourself on education but also not over-delaying getting starting, and you should do fine.
Some things to consider in selecting your focus are:
- What are you most interested in?
- What best fits your goals?
- What might you best be suited for?
- What have you found good resources on so far that fit the above questions?
This is such an exciting phase. You are about to pick a new project! A new thing to learn! You may well be starting your future right now! All of that research is now about to pay off. You are about to officially get started. Be excited!
3. Get educated!
Now it’s time to get out of the general education phase and start aiming for more focused education, specific to whatever focus/niche you have selected. This should be fun. Remember in college how so many of the core classes you took were totally “ick” because they didn’t pertain to your major at all, and you would have rather been in “major” classes the whole time because they were so much more entertaining? Assuming you selected your major — and now your REI focus — based primarily on your interests, learning about it should be fun! (If it’s not, you may want to skip back a couple steps and start over.)
Finding any books you can on the subject is great, although a lot of times actual step-by-step manuals for REI niches are tough to find or nonexistent. You’re probably going to have more luck finding online programs. Webinars, podcasts, and YouTube videos can be great. In the case of those, however, really research the source of the information. Any Joe Blow can jump on YouTube and tell you how to flip a house, regardless of whether he has the slightest knowhow about the topic.
For that reason, I really recommend finding, as I discussed earlier about authors, someone whose information and values really resonate with you and maxing out the resources they offer. Maybe they have their own YouTube channel or blog roll on BiggerPockets, or maybe they put out podcasts or webinars or manuals on their websites. Stick with those! You always want to explore information from a few different (respected) people so you can really tailor your own methods to what works best for you, but ensure they are actually legit resources.
Important note: Stay concentrated on the focus you have selected, but keep an open mind to anything else that may be falling in your lap!
I can give a quick example of this because it happened to me. When I was at the point in the process of selecting a focus, I actually chose to forego REI and focus on starting a self-storage business (I was researching both business and REI options at the time). So I decided on self-storages, and I immediately signed up for and attended a week-long self-storage conference in Las Vegas. I was all in.
Next thing I knew, randomly one day while I was sitting at my desk at work, I got an email from someone I didn’t even know promoting REI in Nicaragua. Completely out of boredom, I watched the webinar they offered, and next thing I knew I was buying property in Nicaragua (yes, Nicaragua), and that led me to buying rental properties across the US, and now I own my company focused on those same types of properties. I haven’t done a single thing with self-storage! My true niche, as I like to say, landed in my lap (but not before I put the full effort in). This could happen to you, too. So be open to it, but in the meantime or until that happens (because it may not), focus on the niche you selected. If another niche is meant to be, it will come to you at that point. If not, maybe you selected the right avenue for yourself!
4. Dig in.
Now the explanations get a lot shorter because most of this part you will have to figure out on your own. Not because I want to leave you by yourself to do it, but because there’s a good chance you are working a niche I know nothing about, and more importantly, from here on out, your path is your own! It will match no one else’s exactly. It shouldn’t! But so I don’t leave you completely hanging, here are some tips to help you in this phase of making your place (and creating your success) in your niche.
- Ask questions. Don’t think you have to do it all by yourself.
- Seek information. The more you know, the better. Figure out what mistakes people have already made so you don’t have to repeat them. Figure out what you need to learn. Remember, you don’t know what you don’t know.
- Look for mentors. Truly, I wouldn’t have survived this long without mentors. Find someone you enjoy, who shares the same goals and interests as you, and who you can be honest with and also help them in return in some way.
- Assume failure is inevitable. This is not an excuse to just dive in completely uneducated; you should still try to get as much education as possible, but if you assume failure is a required part of the journey, it will make the idea of it a lot less intimidating and it will lessen the blow when it does happen. Everybody will fail, or rather make a mistake, at some point if they continue in REI long enough. Getting as much education as possible will potentially dampen how big of a fail you endure, which could mean the difference of a lot of money lost. Also remember that failing doesn’t mean you are a failure. It actually means you are a rockstar for trying! And fails or mistakes only make us stronger anyway, if we work them right, so they are actually a good thing.
- Learn from your mistakes. This is really the biggest way to succeed. If you don’t learn from your mistakes or you stay too busy wallowing in them, you won’t succeed. If you ignore this bullet point, you might as well ignore this entire article and pick a new industry to play in.
- Avoid analysis paralysis. On the flip side of getting lots of education, don’t get stuck in the mode of continuing to get more education when really you should be jumping in. This is another one of those times I can’t offer you a magical formula that explains the balance between too much education and not enough education, but keep it in the front of your head and go with your gut.
- Try something. Start small so in case you goof up, you don’t lose as much, but you’ve got to try at some point! Maybe it’s not a full blown deal, but maybe it’s a part of one. Or maybe it’s working as an apprentice with somebody. Try something. Anything. Just do it. Get your feet wet!
There you have it! The only beginners’ guide you will ever need.
Hey, all of you advanced investors out there: Anything you would add that the newbies should keep in mind as they truck along their journeys? Newbies: Any questions about the process?
Let start a discussion in the comments section below!