Beginning Investor: California

Greetings :biggrin

So I’ve finally decided to hop on board after lurking for awhile. The wealth of knowledge here is amazing and I’m happy to finally be a member. Anyway, my name is Mark, I’m 23 years old and I live in Los Angeles. I recently graduated with a Bachelors in Management Science/Economics from UCSD. My passion is in real estate investment.

When I moved to La Jolla for college, I founded a rental-based company that earned enough to pay off all my student loans, with a substantial leftover profit. The company I created even doubled the cap-rate on a few properties - won’t say how, unless you’re investing of course haha! My business is innovative and has national level potential, however it cannot be scaled without significant capital investment. Thus, I have put it on hold and now in pursuit of capital.

I have read easily over 30 books on real estate investing, start-ups, marketing, sales, and I’m on track to obtain a CA Broker License in November- possibly beginning my career as both a broker and individual investor. I’ve already satisfied the prerequisites for a Salesperson’s license and am concurrently studying for the Series 6, 63, and 7. In a few years I’d like to return to school for an MBA- although this is more of a personal goal. I truly have the mindset for Real Estate when compared to other fields and I have strong skills in negotiation. Yet I feel undercapitalized and have no long-term record of stable income- putting a conventional loan out of the picture.

So what are your thoughts/advice for a beginning investor in California? Could really use a mentor more than anything haha!



Welcome to REI Club!


Here’s i what I would recommend to any newbie. I may copy & paste this again in the future (haha).

The best advice I could of gotten when I first started investing is…“Find your business or real estate niche, and stick to it. Once you find your cash cow…milk that thing dry. Don’t veer from your goals, just stick to what works and let that niche / business system make you rich”

It (your niche) needs to be something profitable, and something you enjoy. One of my greatest business challenges I have ever faced…is me, myself and I. There are many ways to get rich in this World, and I have personally identified (note: sometimes heavily researched) and wanted to pursue at minimum of a hundred or two hundred different ideas over 10 or 15 years. That is a great problem to have, but it can also be a hindrance. For years that kept me from finding & sticking to one particular idea, or niche, long enough for it to become successful. When I finally grew up in my “mid 20s”…and I realized the best way FOR ME to get rich is with passive and semi-passive income…I built a business that has made me, well, quite financially secure. Some people would call it rich. And I am still growing the business to this day. Note that business has nothing to do with real estate, but it does involve semi-passive income (I don’t have to be “there” to earn money).

Now I am in a position where I am also paying cash for houses, and getting returns of 20%, 30% and more. That’s not as good as my main business, but it’s definitely not bad.

If you want an example of a good business idea / niche that can make you a fortune…checkout Lonnie Scrugg’s teachings on mobile home notes. You can get annual percentage yields all day long - upwards of 85%, 100% and higher. There are people who have gotten 50+ part time mobile home notes…and still kept a full time job. Then you can take the cash from that, and buy long-term assets like mobile home lots or parks…or heck, pay cash for houses that are selling for 25 cents on the dollar like me. =)

And some people are doing creative things, like putting mobile home notes inside of a self-directed IRA. Could you imagine earning 85% or 100% interest and paying $0 in TAXES on your earnings??? It’s legit. And note technically your earnings are tax deferred, not tax free, but that compounding effect will give you so much money so fast…it will blow your mind.


Good luck!

You got a great start. Wish I had even HEARD of creative real estate investing when I was 23. If you’re undercapitalized that’s great! No money to lose. LOL. If you’ve read 30 books on REI I’m sure you’re familiar with many ways to make money in REI with no capital. Like MotivatedCEO said, find one and stick to it.

Just take action…and lots of it. Along the way, be sure not to write big checks (until you really know what you’re doing) and don’t make promises you can’t keep.

@Gold River: Thank you for the warm welcome!

@MotivatedCEO: You are absolutely right about finding a niche and milking it dry. I have recently begun receiving advice from experienced investors like yourself and they all agree that attacking a niche is a strong, proven strategy. Regarding mobile homes, I must admit that I am not familiar with this area, but I am definitely lured by the comparably lower cost of entering a mobile home deal versus say, a traditional home. The area of Los Angeles I live in is largely zoned for offices and large multifamily complexes, and I am unaware of any parks nearby. There may be a difference in our niche, but we definitely share the same desire for passive income haha!

@nsu1997: So it’s actually quite ironic: although I have read a ton of books, I somehow avoided “no money down” ones. At the end, I realized I have the knowledge required for an active investor with access to credit and capital, but not enough to get started! Thus writing big checks is definitely out the picture for now haha. And seriously LOL I never thought of it that way, but “undercapitalized” actually does actually mean I have nothing to lose. Quirky yet accurate observation.

Thank you all for taking time out of your day to reply, I am very grateful.