One book=Enough knowledge to invest?

So I’m very new to REI, but very passionate about it.

Of course the next obvious step is to start reading books about it.

So I have been reading books. Many books. But I keep seeing this reoccuring theme in them.

Basically they say things like “You don’t have to have much knowledge, just get out there and start doing it!”

or

“After reading this book you’ll have enough knowledge to go out and invest in real estate!”

and other similar statements.

So my question is this; is reading one book going to give you enough knowledge to start investing?

Also, is having little to no knowledge enough to go off of when you start investing?

I’m curious because if it is, I’d like to get started already. If it’s not, I’d like to figure out what other steps I should be taking to get me into my first deal. I’m really passionate, and really anxious to get started, but not stupid enough to just jump without looking. So any advice would be great

Also, telling me how you learned would help alot too. Thanks

Jeremy

Welcome to the world of REI. This site will provide you with more real world information and experience than any program.

If you have a specific question, use the Search function to look it up. It has probably been asked and answered in the past. If you cannot find it…feel free to ask questions. The Forum is made up of members who have probably encountered the same issues.

There are also numerous learning options in the Investor Information, Real Estate Products and Investor Resources sections.

Find your niche and make it happen.

We all wish you the best of success!

:beer

Putting your money at risk without much knowlege of what you are doing is a really good way to lose your money.

Real estate isn’t that complicated. It’s not hard to gather enough information to prepare you to invest. It is also true that you can get into a state where you never act, thinking perhaps you should learn a bit more first.

Jeremy,
I was about ready to go for my PHD but then I married my long time girlfriend and on our wedding I got Rich Dad Poor Dad books from one of the friends. That changed everything for me. I read them, and then read a bunch more for over a year, only then i had the nerve to invest.

Reading books in general is good, but the only way to learn this business is to actually do it. No book will teach you how to do it perfectly. No matter what, your first deal is not going to be perfect, because you are new you will let people to take advantage of you here and then. But that doesn’t mean you won’t make money on the property, I am making money on mine.

So, my advice is to start as soon as possible but start small so that even if you screw up big time, you’d still have recourses to invest again. I am working right now on my second deal and all the wonderful lessons learned that I accumulated from my first deal are gonna be applied on my second investment.

Good luck and have fun. This business is so damn exciting, you wouldn’t believe it!

I suggest learning from books, but better learning is getting knowledge from a local person that is doing what you want to do.

There are some great articles on this site about working with Mentors, finding Mentors, etc. I can’t stress the need for a solid Mentor, but don’t be fooled.

The first rule of real estate is still “Location, Location, Location”. So a Mentor from another area of the country just doesn’t seem like a smart idea to me. How can someone in Phoenix teach you specifics about somewhere outside of Phoenix, say maybe Memphis, etc.

I think you get my point. Attend local REI Clubs and find out who is ACTUALLY doing what you want to do. Not just talking about it, rather actually DOING it.

You asked how you learn… Simple answer is by doing… As someone who helps others it is impossible for me to give my almost 3 decades of info without first having a situation to explain… Certainly I guide them on their way however every deal is different… I think you must educate and have a safety net at the same time… Not that books aren’t great they are, however practical experience is vital.

Lrbron James is a great basketball player who could fast track his success however he still needs a team and a coach.

I agree with Mark (Mdhaas). You should start reading all you can here. You need to figure out what aspect of REI you want to pursue. Don’t try to do 10 different methods and suck at all of them. Figure out what you want to do and what you can do. What I mean by that is if you don’t have any money and/or bad credit, you’re probably not going to be doing buy & hold for rentals. You would probably want to get started in bird-dogging. If the thought of tenants scares you but you have money and can get loans, maybe rehabbing to re-sell.
All books want to give you that warm fuzzy that you’ve learned enough and you too can invest in Real Estate. Personally, I started off with a small multi-unit building. You can search for old posts of mine if you’d like to see the details of it.

Good question Jeremy.

Knowledge isn’t everything. You have to apply the knowledge you’ve taken.

What makes a good investor successful is that he is willing to step out of his comfort zone and look at properties, talk to sellers, make offers, get embarassed- whatever it takes to get the experience.

Having said that, due to your relative newness I would still exercise caution.

One of the best ways to make money while you learn is by bird dogging properties that you’ve located or wholesaling/assigning contracts to other investors for cash.

Here, you get to learn without risking much money- what a deal really looks like. If you can’t flip a property or a contract- then it probably wasn’t a good deal to begin with.

Wouldn’t you much rather have learned that lesson when all you had was $50 tied up on an option or $100 on earnest money?

all the best

Dennis :bobble

Wow thanks guys that was a great response.

So I’m basically assuming that the general advice is, “Learn, be cautious, but deffinitly just get started.” I’ve been studying for 2 months now, read alot of books and I already know I want to work on lease/options, sub2’s, and just options. That’s where I want to start. So I’ve found a niche that I’m focusing on right now. And I am reading alot (especially on sites and forums that are dedicated to the subjects I’m interested in) but I’m getting closer to a stand still where I’m not learning much from books any more.

At that point, shouldn’t I just get started? I know that with several of these deals little to no money is required to do them, so when I’m excited enough and have kinda hit the roof with what I learn from books on a particular subject, wouldn’t it just be best to start applying what I’ve learned?

The answer I’m seeing from my question is “No. You should study a little bit more then one book, but you shouldn’t study too much before you just do.” Am I right?

Thanks again guys This site and forum has been a great help to me so far.

Once again my colleague Mike in SoCal is right!! Do a deal. Start making offers! Get out of the stadium seats and on to the field. When you start making offers and getting involved with a potential contract, you are no longer new in the business as you have gained some experience!

Stop reading and preparing and start doing! If you lack the courage, pay an experienced investor to walk you through a few deals on a split.

You can read many stories of guys who spent their lifetime preparing and because they felt they were never quite prepared, they were rendered broke.

Jump off the bench, you are a starter…batter up!

Rob
R.E. Investor/Mentor

[quote author=JJ
“After reading this book you’ll have enough knowledge to go out and invest in real estate!”

and other similar statements.

So my question is this; is reading one book going to give you enough knowledge to start investing?

Also, is having little to no knowledge enough to go off of when you start investing?
[/quote]
Yes, if you have a passion for you and know this is something you’d enjoy, go out there and try it.

Think about this. Years ago before I was a realtor, I bought an apartment building that a guy tied up with the listing agent through that listing agent. I paid his client $6,000 to assign that apartment building to me that was from an estate sale. His realtor found the listing, not the client. The client probably looked at several buildings prior and knew right away it was a good listing. His client didn’t need to read a book to put an offer down and tie it up. The realtor had the knowledge. His realtor did all the marketing and virtually all the work and I gave his client six grand (in addition to the realtor’s commission) for just showing up and signing a piece of paper the realtor wrote up. Granted, you’ll need to convince the realtor you’re capable of closing this deal before he’ll let you put an offer down so you can assign it. But, do you see how easy it is to make money in real estate with little knowledge?

David
Realtor & Investor

Well, like anything else you learn in life, real estate is not complicated once you know it to do it.

• Buying & selling a house is EASY, especially if you use a realtor. Doing it yourself requires knowledge of contracts and forms, which is slightly HARD unless you know what you’re doing. But it becomes easy with time.
• Rehabbing a house is EASY, especially if you use contractors. But it can be hard when you encounter problems - ie a contractor doing shoddy work OR taking your money & leaving - which all can be easily prevented with knowledge.
• Having a high level of social skills, including sales skills and negotiating skills, is very HARD for most people. It is EASY for me, as I spent time studying books on sales, negotiating and business. Plus I have business experience - so I am a very articulate and good communicator. You need those skills to really do well, whether you are negotiating a house price (buying or selling) or dealing with tenants and contractors.

So don’t expect to read just one book and get rich. Read many books, and you’ll be far more successful.

AND STAY AWAY FROM THE GET RICH QUICK SEMINARS & LATE NIGHT INFOMERCIAL GARBAGE. =)

Good luck!

Uhh so it seems like you guys are saying that I should go out and do something.

I’d assume you’re advice is to go find a mentor at my local REI club, not one that I have to pay big bucks to, just one that would be willing to guide me through a few properties and help me out on my first few deals and split the profit with me, I’d be willing to go 90 to him 10% to me. I don’t need the money right now, I need the knowledge.

Of course you say “Stay away from late night informercial and get rich quick crap” But… how can I know the difference as a newbie? Isn’t Carlton Sheets a get rich quick late night informercial guy? What about Ron LeGrand? Peter Conti? See I’m not sure whose books to buy (though I do love Ron LeGrand and Wendy Patton, again, how do I know they’re really trustworthy?) so some recommendations on some books would be great.

And I’m not gonna pay money for a book list… I had one guy try that… I was like… No. Not happening. I’m only 19 I don’t have money to just throw at any person who has some “Book list”

Anyways, my other problem is I don’t know where to start. I’ve read books and all, but I really don’t even know how to put down an offer. Nor do I know how to get contracts or go through a closing. I keep thinking “Oh this is simple, look up some houses, call someone and put in an offer, and if they accept, close on the deal.” But again…

What constitutes a good investment property? (It’s got to be a no money down deal for me right now… Sub2’s, Lease Options, Seller Financing, Contract For Deed, Assignments, etc, etc)

How do I make an offer?

How do I Get the contracts?

How do I close?

Lol Yea, I’m really newbie. But I’m not done studying or trying yet! But some more focus on what authors are good and what authors are bad would save me some money… lol. Thanks guys!

Sure, birddogging is an option, where you get 10% of the deal. You shouldn’t have a problem finding someone to pay you a birddog fee at an investment club if it’s a really good deal.

If you’ve got no money, lease options, like you suggest, would be another good idea. If you see a vacant SF for rent or for sale, call it and offer to sign an assignable lease option for $50-$100 more per month above the normal asking rent. If you exercise the option, you get a credit back towards the price you negotiated. Then you clean it up a little and try to sell the option. And, discuss what cleaning up means to the landlord so there’s no issues later on.

If you don’t exercise the option, he has a long-term lease signed on the building and he doesn’t have to worry about it being vacant and paying the bills each month on an empty building. If you do, he gets a price he’s satisfied with. It’s win win and a fairly easy concept to sell to vendors. I think it would be a good place for you to start. There’s plenty of free stuff you can goole on how to do it.

The problem with infomercials like Russ Whitney or Charleton sheets, etc., is that if you pay for a seminar or mentoring, it’s not taught by Russ Whitney or Charleton Sheets, but some hack who’s experience may be owning two townhouses in their lifetime and he’s just recanting theories. If you’re looking for a mentor, question him on his experience. This is the most important thing and I’m not talking about “Oh I’ve done 200 of these deals and that’s why my mentoring is worth 5 grand” Stay away from vague and theoretical mentors. You want specifics on what deals he has done, can he prove it, and does it fit in with your goals. The guy who’s proven himself with specific anecdotes of what he’s done is worth learning from. Mentors who are legit have such an ego that they have no problems bragging about how they made their great deals. It’s true. The phonies who have little or no field experience are just looking for a paycheck and won’t discuss the details of their deals. Those are the ones to stay away from.

If you want to understand salesmanship and negotiating better, go get your real estate license. it costs a lot less than mentoring. You pay what, $1000 for inhouse courses in your area, you write your exams and then you find a broker who’ll train you on the job to be an excellent salesman and negotiator, which in effect will make the both of you lots of money. I’d probably stay away from Re/max with their ridiculous franchise and desk fees. A smaller name office is better and would probably give you more personal attention to learn the kind of skills you need.

David
Realtor, Landlord & Investor

I can simplify this a lot for you…
Find a lawyer in your area who handles RE closings. The lawyer will be able to provide you with a good legal contract (not some one size fits all thing you’d find for $20 at Books-a-Million). The lawyer can handle the paperwork for your deal. So now you have a contract you can take to a seller and you just have to negotiate the deal. If you can’t find an investor in your area to help guide you thru a deal, the lawyer can probably give you some advice as he’s probably seen something before like what you’re trying to do. Once you have an agreed deal with the seller and you’ve both signed the contract, you are “under contract.” There should be a period listed in the contract (generally 30 days is pretty standard) that is your due diligence time. During this time, you can get the property inspected, your lawyer will be able to do the title work, you can arrange financing, etc. When you’re all complete and the lawyer has done the title work, you can set a closing date. The closing will take place at the lawyer’s office (or a title company if you go that route) where you and the seller will appear, sign paperwork, money changes hands, and you get the property.

For what it’s worth, I’ve read some REI books and I’d trust information on this site more than books. What I generally find with the books is you get maybe 5-10 pages of pretty good information, but there’s also a lot of stuff in them that is either outdated or simply doesn’t work in the real world.

I have taken quite a few courses and read a few books myself. I noticed with ALL of them has some holes that need to be filled. You can try to fill those holes by doing deals or with more books, I’ve done both but what I realized is you can’t beat EXPERIENCE! Once you have done your first deal, mentally you will start to relax and say to yourself: “Hey I can do this” and when you get that first check in your hand you are going to want to do it again and again.

This is my humble opinion, I wouldn’t go with Lease Options unless I have a cash. Just in case something happens to the tenant or the property. I would Wholesale a few deals first to build up a cash reserve and THEN go with Lease Options…just my two cents!

Wow holy crap my main problem right now is figuring out whose advice i should take! Its all so freakin good. You guys are lifesavers. I prob will wholesale/birddog first. Im getting some contacts here that are willing to buy wholesales from me so things are getting better. This is some really good advice though wow. Keep on giving me advice though please. At either rate mike advised me to stop reading and just do something so im gonna listen to him and stop reading. Im going to start looking up leads. Anyone have an opinion of becpming an agent? Im seriously considering doing that. Itd beat the hell outa workin at walmart.

Wow, popular topic.

Try not to get overly confident in what you read in the books. Most authors are just that, authors.

The reason they all sound similar is because most authors copy other authors.

Make lots of offers

Make lost of offers

Make lots of offers

As you make offers and negotiate with sellers you will learn a lot about the business.

Try to find a mentor that you can bounce a deal here and there off of.

Hope that helps!

Interesting, I see myself in that statement a lot. It’s so easy to learn but never execute. Nike has it right with the "Just Do It’ mentality. That doesn’t mean be stupid or uneducated - but at some point you need to execute - do a deal, make a transaction, move forward. You could spend your whole life reading, learning, and you still wouldn’t know anything. Every deal you don’t make is money you don’t earn, right?

Also, in real estate, there is no “textbook example”. Every property, every deal, every transaction, has it’s own unique characteristics - and to be successful you have to think outside of the box, be creative, and passionate. Good luck!

Wholesaling Real Estate is a good business to get into. In fact this is what I do FULLTIME. This is my ONLY source of income, I don’t sell books, mentoring or anything like that. I know I am missing out on a good source of income but I can’t get myself to do it. I have been burned many times with these guru courses and burned about $25,000 on various courses, and mentorships. I’m going to have a “biased” attitude towards gurus and courses so I just wanted to forewarn everyone ahead of time. I do realize that some people have been successful with these programs but I have not so I’m going to speak based on my experiences.

If you are considering wholesaling real estate it’s a lot of work in the beginning but once you created your “network” (What I mean by network is Real Estate Agents, Lawyers, Contractors, Your buyers, your leads…etc) You will start to do well.

For starters PLEASE, build a buyers list first. Don’t listen to those gurus who say go out and find a deal first and THEN look for buyers. I did that and I got burned! I got burned because I founda deal and then I had a 30 day window to find a buyer. I tried everything and long story short I didn’t find a buyer and I had to use my inspection clause to get out of the contract because the seller got impatient. I will never forget the the look on his face when it didn’t work out. He wanted to relocate and he couldn’t because I didn’t come through. That will never happen to me again. LEARN from my mistake and Find buyers FIRST!!!