How did you first get into the real estate game?

Question

What did you do that first got you into the real estate game? Because I was thinking about getting a deal that looked good and going to find a experience partner to help me get over the initial learning curve in real estate but was curious how others started or would think the best way to get myself into the game.

P.S. My area doesn't have local meetups

Nathan Gesner · Answer

Why do so many people struggle with getting started? They over-analyze. They think they need to know everything, have the perfect property that cashflows $500 a month, etc.

I knew nothing. I read one book that showed the benefits of real estate investing, then I scraped together some money and bought what I could afford in a town I liked. I hired a property manager without knowing anything about what a good property manager looked like. She was decent, but I never received monthly statements, I didn't get copies of invoices, I never knew who was living in my unit or what their lease terms were, etc. I just put some money down on a rental, she rented it out, and it somehow worked.

My first rental started out making $25 more than the mortgage, which is terrible by today's "cash flow" standards commonly taught by BiggerPockets and others. I wouldn't buy something like that again today, but the good news is that real estate is very forgiving! I set aside the measly $25 each month. I raised the rent every year and was cash flowing $450 per month eight years later.

I bought the property with $6,700 down. I used the cash flow to cover all expenses and never had to use any of my money to cover maintenance, vacancy, etc. I sold that property for $90,000 profit in 2012 (despite the housing crash).

Mario Morales · Answer

I saw a 3 flat next to the train station and said "if this unit brings in 1100, the 2nd unit $800, and the 3rd unit $400, I should make some money here". I had no idea bigger pockets existed, just a very, not recommended, way of analyzing this deal. Units 2 & 3 couldn't pay rent, so I nearly evicted 1 and unit #3 just left, I was in the negative, 100 a month. I fixed up the other unit with the bare minimum and house hacked. Started to cash flow. Got my realtors license to understand the business a little better. This building allowed for buildings 2 and 3.

I shot 1st and aimed 2nd.  I got lucky and maybe the hard work that I put into it paid off, not sure.

Michael Paling · Answer

Several years ago I decided that my first home purchase was going to be a duplex to house hack. I successfully did that last year and I’m working on deals 2 and 3 now. To get over that first deal, I finally realized I was in a financial situation where I could confidently purchase my first house. I posted an intro post here on BP and connected with other local investors and being around them have me the the mental confidence to know I could do this. I’d suggest the same for you: make a post and use key words around your area like city names so that other local investors might get notifications. If there’s no local meetups, try to start one yourself. You don’t have to know real estate stuff to set up a meeting with people.

Hamp Lee III · Answer

I purchased my first home using my VA loan benefit.

I was living on the military installation and saw black mold. They put us in a hotel for a couple of days, and when I returned, I learned they only cleaned what they could see. They were not thorough. I told my wife (at the time) we were moving off base now. That was Thursday. Had a house under contract by Saturday.

I was glad I did that because the mold was making her sick...even though she's my ex-wife now.

...and my divorce became the catalyst for purchasing additional properties.

Blake Peterson · Answer

No worries there, I completely understand. It may be worth a quick look or discussion with an agent or lender to see if your city has any down payment assistance programs. There are some that are grants, meaning you don't need to pay them back, and some that you pay back when you eventually sell the property. Partnering is an effective strategy if you need the financial assistance, but make sure to find someone you can trust to do business with.

Blake Peterson · Answer

@Christoper William Owens

House hacking is a great way to start! You buy a duplex, triplex, fourplex and live in one side while renting out the other units. You can get conventional or FHI financing with less than a 20% down payment. You get the experience of being a landlord and managing tenants, but won't be overwhelmed with a lot of tenants at once. "Set for Life" by Scott Trench lays this out well and is a good read. I'm currently saving up to do this exact thing. Let me know if you have any questions.

John Morgan · Answer

@Christoper William Owens

I knew nothing about real estate when I started 8 years ago and did zero due diligence on my first property. I called up the listing agent to look at the property. Then emailed her a low ball offer a couple days later after a couple beers. Lol. The seller countered and I got the house. Boom! 8 years later, I somehow have 18 rental houses. Lol. It’s a fast learning curve and an easy way to make passive cash flow on the side.

Christoper William Owens · Answer

I don’t have much money and was thinking it would be most beneficial to partner with someone who does have the money and just manage the other half regardless of how we split money. I would still gain some experience in the game.

Jay Hinrichs · Answer

I got started by getting my real estate license and working in the industry to learn the ins and outs and the networking is second to none when your in the game so to speak other than my personal residence I did not buy rentals till years later.. I flipped land though !!!

Dylan Thomas · Answer

Hey man! I’m in Mobile too, I just sent you a message

How did you first get into the real estate game?

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