I am a complete newbie. Own a single family house in Chicago suburbs.
Currently looking to become a real estate investor and eventually quit my job and start doing deals (if successful).
I have 75k to invest. Could the gurus please tell me how I need to get started to accomplish my goal.
Thanks to all.
broad question…and one that’s been asked by many.
but - you’ve got 75k. is this 75k money you can afford to lose? (like every penny) and still be okay?
alot of guys talk about “wholesaling” deals. it always sounds like the best way to start. your exposure - as long as you do it right - seems to be a lot less…and with very little or no money down.
Welcome,
Congrats on your first post. $75,000 is more than enough to get started. Good point from TMCG…there is really no need to invest all the monies you have available on your first deal…you might want to start with half it just in case.
First you should review the different avenues of real estate investing, and see which one interests you most. The, check around your area, or the area you hope to invest, and see if that particular investment would work well in that area and would be profitable
Yes I will be ok if I lose it. But of course dont wanna lose it all…I wanna give a business a try. If I fail then I go back to what I do best (making my employer rich)…I am posting here to educate myself.
My options for investing are stock market or real estate. I know a lot about stock market. Know nothin bout real estate except that I closed my house 5 yrs ago and have a mortgage…Straight forward stuff.
I guess I am also open to Real Estate investment clubs and am exploring those.
This seems like the best forum to educate myself and get ideas from experts in the industry. And that is the goal of my posting here.
Thanks again.
Thx a lot for the reply. I guess for a novice like me, how do I find out all the different avenues for real estate investing. I know about direct wholesale deals.
What else can i explore ?
itguru
Good to meet you…
First thing is stop saying you have 75k… Go hide that somewhere and keep it safe until you are certain you know what you can do to make money…
Second, spend some time on this board and read a lot…
Third, Eventually start doing while youre reading…
Fourth, Do not quit your day job until you have earned at least 6 months of income and saved that through investing…
Fifth, Then ask yourself why quit if you were able to work and make 6 months extra income at the same time.
Good House Hunting
Michael
Thx MichaelQuarles. I share exactly same strategy. No plans to quit my job ( although would love to) in near future. Need to see what I can do in real estate investing and can I make similar money to my current salary.
What is the general opinion on real estate investors club ? There are tons of those in Chicagoland and I am not sure if it is worth to become a member.
Good…
As far as clubs… As a guy who got paid to be on stage I can tell you that there are good things, actually great things about being a club member a crappy thing…
Great in that you can network and learn, crappy in that they are a profit center. So leave your credit cards at home… Do not start going to boot camps and expensive seminars until youre certain of the type of investor you want to become… The clubs expect to sell 10-25% or the room and they get 25% minimum of the receipts…
Just know that and youll be fine
Happy house hunting
Michael
Thx again. This website has a million plus articles. Where can i possibly start ? :banghead I am really overwhelmed to the point that I can do with some direction from experts.
I am getting inclined to buying & selling houses ( think they call it wholesaling). Dont want to get into renting just yet. Can do it on mortgage or my own money. I have excellent credit so mortgage should not be a hassle even if I cant sell it for 3-4 mths.
Contact your local realtor with what you’re looking for and discuss your goals. Something cheap, but functional. I would recommend a triplex which needs some cosmetic work and with at least two of the three units rented so you have an income and are not stuck with a white elephant draining your resources. Get it conditional on a home inspection so you know what you’re getting into. If you’re satisfied, buy it. Try updating the empty unit. Go to Home Depot and ask a lot of questions on how to do it yourself. Then, do it yourself and build some sweat equity. Then, rent out the empty unit. If you like the renovation business, keep doing it when the other tenants move out. If you realize you don’t like it, have the realtor sell the place so you’re not out a lot of money. I think wholesaling is for people who’ve been in the business for a while with a lot of renovation experience so they know what they’re getting into and not loosing their shirt. I’ve met a lot of crash and burns in my lifetime and what I’d recommend.
David
Realtor, Landlord & Investor
Definitely never put all of your capital in one deal.
Start off by putting houses under contract and wholesaling them to other investors.
Here’s why: you get paid to learn.
You get to learn the biz from marketing to negotiation to contracts to estimation of repairs, to wheeling and dealing and only risking option consideration- which for me is about $10.
Yet the deal could be work Several $ks
When you get your cash reserves up as well as your experience, move on to holding properties yourself.
Through wholesalling you get experience in several things while minimizing your risk and cash outgo:
You learn how to market, how to identify what makes a good deal, you formulate a strategy, negotiation, contract writing everything up to the closing point- but someone else closes instead.
Wouldn’t you rather make your mistakes this way when yo have only $10 on the line rather than $75k or more?
Work the kinks out here first, then move on to bigger paydays that require more risk.
dennis
look into your local real estate investment clubs, a membership should cost you less than $200 a year and no other fees except special events that you maybe interested in. If your not sure which one to join, call the local WE BUY ADS and talk to those investors. Ask them what club they belong to and your looking to network. Offer to buy them lunch and talk about the investing world.
It is very important to know your exit strategy when buying a property never forget that. Also for investment purposes, NEVER fall in love with the house, fall in love with the numbers. If the numbers are not there, walk away, this is not a game for emotions. Same as being a landlord. We are human, we understand job loses, no insurance and health issues, etc, but tenant does not pay rent, you do not pay mortgage. It becomes your credit, not theirs. To many landlords give breaks and let tenants go 2-3months before filing evictions, sorry, with me you get that letter on day 5 and by the 14th I will be filing my court papers or sooner.
Depending on where you live or where you want to invest will dictate what area of REI can be done best for a newbie IMPO. I live in SFl and rental market is really tough with high unemployment, taxes and insurance on the homes. I still do them but it is rare. I lean more for rehabbing now and rentals are best when they are 20unit buildings or more.
Houses are horrible to rent unless you find the gem in rough.
Do not be so quick to jump into the arena. Learn 1 area really good then apply the methods. Once you master that area, wether wholesaling, rehabbing, foreclosure, then jump to another type of investing to open your horizons.
After 6 yrs I still hardly do lease options or subject to deals.
To be successful their are many important keys. Here are the most important.
So to answer your questions, here are a few strategies I recommend. I hope this helps.
join a REIA
find a mentor that DOES deals every month
realize that you are becoming a marketer and learn about marketing
consider investing in Canada.
good opportunity. good banking security. constant demand.
And Canada I hear has an extremely low default rate…