What is a "realistic" set of goals outside of looking for first property?

Question

Hey Bigger Pockets Crew,
	
	So...one of my big goals over the next 5 years is to develop a portfolio of real estate valued at $3 million that passively cash flow at least $150,000 a year (5% Passive Cash Flow in my mind seems reasonable but I admit thats sort of pulled out of thin air)
	
	Big issue I'm facing honestly is that I don't really know how to set specific goals for numbers and what I should "expect" in the beginning to measure progress.
	
	I've been successful in my internet marketing ventures for 5 years so I definitely know specific goals are key (I have goals in almost all areas of life except here).
	
	How did you guys and gals set your goals early on both numerically in terms of passive cash flow but also in "how many units should I acquire this year?", "how many lenders should I establish relationships with?", "how many real estate professionals should I have hunting for property for me?" etc.
	
	I'm in sales and joint venture recruitment in my online space so naturally I'd think having more of these lenders and real estate pros on my side would be a good idea but I admit I'm flying blind on the specifics.
	
	I'm quite possible overthinking this so happy to have people answer that too if that's the case.  
	
	Appreciate any advice or experience you might be willing to share :)
	
	Thanks,
	
	Brad Spencer

Steve L. · Answer

I come from an internet marketing background.  Money moves a little bit faster in that space, but the strategies also change way faster.  You have to re-invent yourself every 6 months.

I think your goals are realistic and you have started to develop a plan of action to get the life style you want.

1. Daily emails from brokers with investment properties to look at and put through my spreadsheets/trackers

How many brokers do you need to contact to get this goal moving forward.   What more specific criteria do you have to get your long-term goal, so you will know if the deal fits your criteria.  Maybe 15-20% cash on cash (once financed) and 30,000 equity pick up per property (depending what price range you are in).

2. Lawyers, banks, etc sending me leads so they can help their clients sell faster.

I don't know much about this source, but probably not a "rookie" starting point.

3. Lenders emailing me or providing letters of credit so property can be purchased with "cash" at better pricing (figure people are willing to give you a better deal if you can close with cash instead of waiting on a loan)
	
	You likely need to start with hard money lenders or friends and family.  After you have a track record of success (10+ acquisitions) you can pull some deals off with banks.  Every state is a little different.
	
	4. Property Management companies hitting me up with possible leads from their client base.

I have bought quite a few properties from this source.  They don't like to manage properties with substantial deferred maintenance and owners who are barely making it, so they would sell it to me and I'd give them a referral fee.  How do you get the ball rolling?  Email, phone call, mailer?

You need to spend sometime thinking about what your competitive advantage will be.  AKA: why you will get deals before others.

For my business the progression was something like this:

- At the start our focus was "heavy" fixers that most investors didn't want to spend the time with.

- It shifted to relationships with agents that controlled bank inventory and knew we could perform.

- Now I have the best financing (other than hedge-fund deep pockets, I guess), decent systems and great market knowledge.

Some of my friends are: the best at direct marketing, pay a lot and do volume, have many connections, add square footage, build new houses.

Good luck!

Bobby Beard · Answer

sorry I just read subject again. So no properties yet. :-)

Brad Spencer · Answer

Just to provide context for what I'd "dream" would be an ideal real estate operation.
	
	1. Daily emails from brokers with investment properties to look at and put through my spreadsheets/trackers
	
	2. Lawyers, banks, etc sending me leads so they can help their clients sell faster.
	
	3. Lenders emailing me or providing letters of credit so property can be purchased with "cash" at better pricing (figure people are willing to give you a better deal if you can close with cash instead of waiting on a loan)
	
	4. Property Management companies hitting me up with possible leads from their client base.
	
	Haha I think big I realize that so just trying to get a structure that's realistic so I can manage my expectations (early 20's were "too much dreaming not enough planning" so trying to avoid that in this new area of my business)
	
	Thanks again :)

Bobby Beard · Answer

you have any properties now? You looking to do res or com?