How to Get Involved While in College

[Liam Spears]

Hi everyone, my name is Liam and I'm a student at UVA in Charlottesville, VA. I have been educating myself on real estate investing on and off for over 2 years now, however within the past couple months I have gotten much more serious about it and am preparing to take action. I am wondering what the best way would be for me to get involved with real estate investing while also being a student. I have a couple thousand dollars saved up in a checking account but not nearly enough to put ~20% down on a decent property. I also don't have a W-2 so it would be hard for me to get a loan. My current thought process is that I would need to get into a partnership/JV style deal with not only someone that I could learn the intricacies of REI from but also someone that could bring more equity to the table. Another thought that I have had is to potentially house hack for my third and possibly fourth year of college and rent out the rooms to some of my friends. I have already sorted out my housing for this upcoming year though so I won't be able to put this plan into action for at least another 10-12 months, and i hope to take action sooner than that. I have found a property that I think would work well as either a fix/flip or a BRRRR, but I simply don't know how to get one foot in front of the other because I don't have the funds or experience for the deal. If anybody has any advice on how I could move forward in this situation I would love to hear it. One final logistical issue is that I don't have a car so it would be hard for me to be hands-on with a deal even if it's just across the city; it would almost be like I'm doing an out-of-state deal with a property 5 miles away. Also, if you are an investor in the Charlottesville area I would be more than willing to connect with you to both learn and also provide value.

[Tommy Feraco Jr]

Hey Liam, 

I was in your place a few years ago. I caught the real estate bug from a college roommate my sophomore year and dove into reading and listening to everything about real estate. For your beginning steps you can start taking action with would be to analyze properties on the MLS DAILY. Most banks, especially when you're just starting out with little to no income may require 20% upfront and may even need someone to cosign for you with a conventional loan. Now, as you mentioned, househacking could lower your down payment(3.5%) as well as your monthly expenses if you find solid tenants/friends to live with you.

How I got started was through getting to understand my market by looking at what properties are going for as well as what the average rent is. Factor these numbers into your monthly PITI payments amongst other costs (insurance, taxes, CAPEX, vacancy, etc) and run those numbers through a calculator on BP or make your own spreadsheet to see if you will cashflow monthly. Even if you aren't cashflowing, you still would have a property that you are paying less for (through renting it out) and getting into it at a much lower upfront cost.

Another thing you could be doing would be talking with a realtor. They have access to the MLS and can get you on an email list that can notify you immediately when a property that meets your criteria hits the market. Part of finding what exactly your criteria is would be how much you are able to spend so it wouldn't hurt to talk to a lender to get pre-approved as well!

Go to meetups. With such a populated area like Charlottesville, there have got to be real estate investor meetups where you can network with some big hitters in the industry. You can find a lot of these meetups through Facebook groups. These groups are great to be a part of for the ability to ask specific questions about issues you are facing because chances are, many others have faced the same. 

You are starting earlier than me and I started fairly early. If I were in your shoes right now, I would spend the next few months saving, planning, and networking to find a property close to campus (SFH or multifamily) where you and a couple of buddies could live while you finish your degree. Also, do not buy a deal for the sake of buying a deal. Make sure the numbers work!

I hope this info helps. This is from an outside perspective looking in so conduct your own due diligence and analysis to make sure it works for you. If you have any questions, don't hesitate to reach out. I have a couple of properties so I am no expert but I do have some experience!

Goodluck man!