Do you dream about building your very own real estate empire? This may sound like the stuff of fantasy, but I’m here to tell you that with enough hard work, it’s definitely possible. Just as with any other activity, there are amateurs and professionals. Some people enjoy, say, writing poems in their spare time. That alone won’t automatically make them cut out for professional writing as a career, but it’s a starting point. The same is true of real estate investing. You may only have an interest in exploring this field now, but that interest can develop into the skill set you will need if you do want to go pro. Even reading this article will help you progress towards your goal.
If you’re considering becoming a real estate professional, this article will help you get an idea of what it takes and where to start. We’ll also dispel the myth that becoming a real estate professional is an inherently expensive endeavor. In fact, the tips here will focus on affordable ways to get your foot in the door.
Pro Tip #1: Get real world real estate experience.
There’s an old aphorism that if you want to get good at anything, you should stick with the winners. This means find people who are already successfully doing what you want to do and emulate their tactics. So, one of the very first things you’ll want to do is start building a network of experienced and successful investors. Not only will this give you the beginnings of business relationships, but you’ll have your very own “dream team” to learn from.
Where will you find your dream team? It’s always a good idea to look around your local area for the movers and shakers who are already out there making deals. But the importance of online communities is also huge. Websites like Meetup.com can help you connect with people in your area as well as in other parts of the country. Similarly, communities like the one here on BiggerPockets are made up of professionals from all areas of the industry. It’s never too early to start building your connections.
Some of the most valuable relationships you will forge will be with investors who will let you participate in their deals on a small scale. You don’t have to throw around a lot of cash to gain this experience. You can learn a lot by simply observing the day-to-day activities of these investors. The laws affecting real estate and entity formation, the ins-and-outs of creating and reviewing contracts, the nature of the markets your interested in, and methods for vetting deals are all crucial and priceless skills that you can learn from your veteran investor friends.
While the educational value of these activities alone is enormous, you will also have the chance to start earning your first dollars from investing. So, yes, you could hire a “professional expert” or self-declared guru to look over your first deals, but you’re going to have better results if you are working with someone who is putting their money where their mouth is. You could get your feet wet with a joint venture, or by finding a way to make yourself valuable to a deal with a group of investors. As a newer investor, your willingness to hunt for deals and pound pavement is one of your biggest assets.
There’s a good chance you won’t be making a lot of money off of your first few deals. That’s OK. Think of it as simply the cost of the education you’re receiving. If you went to college, you paid tuition. This is the real world version of that—some sacrifices to the game are inevitable if you really want to master it.
Related: What Newbies Should Know About Financing Investment Properties (Versus Homes)
Pro Tip #2: Get a real estate education through professional seminars.
Real estate investing seminars are another way to gain the education and experience you need for success in the real estate industry. These seminars take place all over the country and are often hosted by professional organizations but open to the public. For instance, in Austin, Texas, where I live, the Austin Board of Realtors hosts regular seminars that cater to people who simply want to learn more about the industry. You can easily find similar organizations where you live by searching online or asking around among your network. BiggerPockets also has a feature that will show events in your area, so don’t hesitate to use it.
These seminars can be wonderful educational resources, and they also tend to be affordable. Those self-proclaimed gurus I mentioned earlier take on such titles typically because they’re in it for the cash. That’s not an issue you’re going to run into with professional seminars, which are infinitely cheaper to attend. As an added bonus, you will get to connect with investors in your local community and further expand your network. You never know when someone you meet in passing at such a seminar will have exactly the expertise you need to answer a specific question—and they might even give you some advice free of charge.
Keep the business cards of your new contacts. You never know when you may need a lawyer or a CPA to take a look at a document or help you run numbers.If you are willing to spend some money down the line, one of my favorite methods for getting a lot of information for very little money is to pay for an hour of the expert’s time. This is an especially good tactic with attorneys. Many of us are hungry for business and will take a consultation for under $200. But if you come armed with all of your questions, you can easily walk away with much more than $200 worth of advice.
Don’t be intimidated by the presence of experts, either. Remember, these seminars tend to be geared toward the public, so you aren’t going to run into a ton of jargon. You won’t need a buzzword encyclopedia to make heads or tails of what’s being said, because plain English is the norm. People attend these seminars to communicate with one another, after all. Nobody is trying to sell you a particular book or get-rich-quick scheme. The purpose is purely educational.
Pro Tip #3: Spend your money where it counts.
If you want to become a professional, there are all sorts of folks who are all too willing to take your money and not offer you much in return (see the aforementioned books and get-rich-quick schemes). A little common sense can go a long way in terms of avoiding scams or giving away money and not seeing anything in return. If something sounds too good to be true, it almost certainly is.
Related: 7 Questions New Investors Don’t Know to Ask (But Definitely Should)
So if you are going to invest in anything, invest in your own education. Invest your time and resources in building the network that may make you wealthy some day. Invest your effort in developing a mindset that leads towards success. Learn from the wins and losses of your fellow investors. Even if you decide real estate isn’t the line of work you want to go into for good, you will still have information and skills that you can use in other areas of life.
I hope this article has given you some ideas about how to bone up on the skills you will need if you are considering starting out in real estate. So let’s discuss—where do you fall on the spectrum between amateur and professional? Where have you gotten the best investing advice? What are some of your favorite cheap or free resources for expanding your knowledge of the industry?
If you still have questions, fire away in the comments section below.
I wish you the best of luck on your journey to becoming a real estate pro!