On starting Real Estate Investment. - Posted by Drew

Posted by John Sheridan on March 01, 2006 at 07:01:46:

Brian(UT) said: “You can’t get lucky if your not playing the game!!!”

I have no problem with that statement at all.

On starting Real Estate Investment. - Posted by Drew

Posted by Drew on February 28, 2006 at 24:54:00:

Real Estate has many, many avenues, and as I’ve read or heard from different message boards, you can find 1 to suit your liking, skills, and financial position. But how does 1 do that without really knowing about it?

In other words, my best analogy, would be, picking the proper computer for oneself. You can’t properly evalute computers, until you actually learn the definitions, capabilities, price ranges, options and so forth.

How does 1 get into real estate, combine financial position, location, and preference?

Perhaps it comes down to reading broad books on the topic, learning to hone in on what seems easy for the novice to spot and take it from there. But with all the ads, books, and systems out there, the neophyte really gets lost amid the storm of options, to the point paralysis by analysis.

Am I making sense? Since the conclusion of college I have “wanted” to get into REI. But that’s just it, the “wanting” but never the doing. Oh sure, I own systems and books, and I’ve done other investing in the markets and had success with smaller pools of money, but nothing as of late that would materially effect my financial position. THAT is what I want. To materially effect my financial position where what I do is merely a hobby or day job, and REI pays my lifestyle expenses.

Fortunately for me, the only debt I carry is student loans, which are manageable. My first thought was to get a home (or look into them), rent it out, as I’m renting an apartment, and build equity that way. But I’ve also explored wraps, flips, notes, options, rehabs, etc.

The best path for me, would be 1 that requires the least capital, most sweat work, and a feasible starting point. Any thoughts? I do appreciate the assistance, and I’m sure such posts have been made 1000 times, it’s that I haven’t personally found 1 avenue to sink my teeth into and I know I’m only getting older (at 25).

Thanks, Drew

Re: On starting Real Estate Investment. - Posted by Brian (UT)

Posted by Brian (UT) on February 28, 2006 at 12:40:15:

Drew

One last thought, your 25 and by ‘doing’ you will be a multimillionaire at 35. Or play the ‘wanting’ game and be saying “I should of” at 35.

Brian

Re: On starting Real Estate Investment. - Posted by Brian (UT)

Posted by Brian (UT) on February 28, 2006 at 12:18:45:

Drew

First let us know where your located, so we know what kind of a field your going to be playing on, it will help us make suggestions.

Now you say you ‘wanted’ to get into real estate investing since college, it sounds more like ‘wishing and hoping’ something would fall into your lap.

Now it is time for the ‘doing’ you mentioned. Again, I don’t know the area your going to be playing in, yes it is a ‘game’ and like any other game you will need to learn the rules and to develop your skills and expand you knowledge.

Step #1- Buy the real estate lawbook from your states department of real estate and read it often, keep it in the bathroom, and it will provide you with a general education on the laws in your state. This will also let you know what the average agent in your area knows or should know.

Step #2- Go into a few real estate offices and ask where the middle of the market homes are located in your area. Mark them on a map.

Step #3- Learn the territory. Write down addresses of homes with signs onto 3x5 cards and call and ask how much they are asking. Same thing with sold signs, the general policy, thanks to a lawsuit years ago, is the agent can’t tell you the contract price until it closes and becomes public record but you can still find out what they were asking. Later on you can call again and get the sales price, and then you can file the card by address for reference. You will see a pattern such as homes sell when the are priced within 3% of the market price, etc. Go to open houses, talk to the agent, get their opinions about things, be upfront about what your doing and ask them questions.

Don’t be afraid to have some business cards made up with just your name, real estate investor, and telephone number to hand out.

Step #4- Go to the library and read everything you can on real estate, read the articles and archives here, your first focus should be on wholesaling because that is the true foundation of creative real estate investing.

Buy one of the courses recommended on this site on wholesaling, if you haven’t already bought one. (one of the homes you find to buy at wholesale will likely become your first home, you can fix it up, live in it for 2 years and sell without paying any capial gains, then do it again)

Step #5- Just do what the course tells you to do no matter what you think, and post any question that you have here. (assuming it not a course by I M Anidiot)

Brian

Re: On starting Real Estate Investment. - Posted by John Sheridan

Posted by John Sheridan on February 28, 2006 at 13:05:14:

Brian(UT) wrote - “One last thought, your 25 and by ‘doing’ you will be a multimillionaire at 35.”

I’m just curious, what do you base this on? Did you become a multimillionaire yourself in 10 years, starting with nothing? Note, I am talking about someone with more than $2 million clear net worth - if someone owns $2 million in RE but has mortgages of $1.7 million, they are not a multimillionaire - they have a net wealth of $300,000…

Re: On starting Real Estate Investment. - Posted by Adam-MI

Posted by Adam-MI on February 28, 2006 at 13:00:48:

Brian,

This means that it would only take 10 years to become a ‘multimillionaire’… is this realistic? I am 22 and in a similar position as Drew, but I was thinking 20 years minimum before I’d ever see numbers like that. I guess it seems like a big leap from nothing to millions in only 10 years… care to elaborate on how this would be done?

Re: On starting Real Estate Investment. - Posted by Brian (UT)

Posted by Brian (UT) on March 01, 2006 at 24:18:54:

John

I started investing in the S.F.Bay area when I was 16 using my married brother as a partner because I wasn’t old enough to contract. At 25 I had a net worth of one million and that is when the average price house in my area was $25,000 and you can figure what that would be in todays dollars. And that was part-time, at 25 I guit my job with U.S.Steel and became a real estate agent/investor. The first real estate broker I worked for said if you couldn’t make a million in 10 years you weren’t trying. He did it in 6 years.

Brian

Re: On starting Real Estate Investment. - Posted by John Sheridan

Posted by John Sheridan on February 28, 2006 at 15:33:34:

Adam-MI - it has been my experience that there are two types of people who say that you can “get rich quick”:

  1. People who heard that “a friend of a friend” got rich quickly, so it must be possible

  2. People who were very lucky to be in the right place at the right time with the right set of skills, and indeed actually did get rich quickly. Any number of things could have gone wrong with their plans, but none of them did.

Those in (1) are not too dangerous, you can usually tell who they are in short order.

People in group (2) are more dangerous. They actually believe that “anyone” can do what they did, if they just work hard. Newbies pick up on the fact that this person is sincere, because they are. The reason this is dangerous is because people will take big risks if they think the payoff is “certain”. Many people have gotten into big trouble this way.

At least 20 years of hard work is about what you should expect to do if you want to become wealthy. If you end up being one of the lucky ones, so much the better.

Re: On starting Real Estate Investment. - Posted by Brian (UT)

Posted by Brian (UT) on March 01, 2006 at 24:22:49:

John

You can’t get lucky if your not playing the game!!!

Brian