What are the best ways to educate myself about REI before my first deal?

Question

Hey, BiggerPocketers!

My name is Jeff, and I'm headed to college next year. I was prepared to jump the gun this summer and take a shot at flipping a house, but then I realized that I have no experience, little knowledge, little money, little credit, and literally zero chance of getting a bank loan.

So, I figured that the best way to start would be to learn (I'm sure many of you would agree).

What are the best ways to learn, in your opinion? I'm listening to the BP podcast, participating on the site, reading books, and trying to do mock-up property analyzations. My primary interests are buy-n-holds, starting with single-family homes in the (hopefully) near future. Eventually, I want to move up to commercial real estate - particularly apartment complexes and hotels (yes, that is a ways down the line!).

Also, does anyone have book suggestions for me? I'm going to be a bookworm this summer.

Thanks guys. As always, it is much appreciated!

Edith TenBroek · Answer

If you are heading to college, you should look around for college housing opportunities.  You may not want to do this immediately, but when you have some cash saved (work full time in the summers!) buy a small house and rent out the extra bedrooms to college roomates.  This may be a great way to get your mortgage paid or mostly paid.  Then, when you are ready to head out into the world, you will already have one student rental ready to rent out.... just rinse and repeat!

Good luck and keep us updated!

Walt Payne · Answer

@Jeffrey Lester on the menu above see resources, BP store. Get J. Scott's books. They will give you a lot of good information. I also recommend Julie Broad's book " More than cash flow... " it tells you the real story of REI, not the guru version. Other than that, at job in some type of real estate or construction would help you get some background experience.

Jeffrey Lester · Answer

All great suggestions, guys. I think when I get down to Missoula for school, I'll try to hook up with a real estate club (if there is one) and try to get to know some of the local investors and agents. Then, hopefully I can get set up with someone who would be willing to mentor me.

If buying a house does not fall through for me while I'm in college, is it possible to rent out spare apartment rooms to other people? I'm assuming I would need permission from the owner/property manager to do this.

Mark Ferguson · Answer

A couple things not mentioned yet.

I would start looking at properties with an agent. Be honest with them about your situation, buy them lunch and get to know your market as well as possible. The best thing you can learn is your market.

I would also talk to a lender ASAP.  You may not qualify for a while, but they can tell you exactly what you need to do to qualify in the future.

I am not sure about family situation, but kiddie condos are an awesome investment.

Steve Pohlit · Answer

I am opposite the view of most here on doing all this reading and research because you will be overwhelmed. The best way is connect with an experienced investor at a local REIA who wants to train you in exchange for you doing the work.  As a real estate investment coach focused on guiding people to getting a deal that makes money fast I have been though the books, seminars, gurus, webinars  - alot of the resources. Nothing replaces the speed of learning guided by experience. Now I continue to learn from others and do online research, buy more books and participate in groups like this.  The leaning never stops but you can always research an area if you want more knowledge. Nothing however is better than guided action steps.

Bryan L. · Answer

Be sure that you also read up on: real estate law, project management, accounting and taxes, basic construction and home repair, sales and marketing, business management, etc.

Tom Reynolds · Answer

Jeff,

I began reading a book last night and thought it may be something you would like to know about. It's written by Frank Gallinelli, "What Every Real Estate Investor Needs To Know About Cash Flow". The book contains well defined terms, methods to analyze potential deals and (37) calculations every real estate investor needs to know.

Jeffrey Lester · Answer

@Edith TenBroek That's exactly what I had thought about! I'm required to live on campus freshman year, but by the start of my sophomore year, I want to have gone through with my first deal! I'm planning on owner financing, subject-to, or a lease option since I won't be able to lock down any sort of bank loan.

Walter Pape · Answer

Great post by all!! I have been researching Rich Dad, Poor Dad info. If you can find a job that teaches you about selling will help you in the long run. A couple of my first jobs in college were in sales, and at the time I hated it. But looking back those skills will be helpful in REI. Best of luck!!!

Walter

Jeffrey Lester · Answer

Thanks, guys! I'll make sure to look into those books and authors. BiggerPockets is awesome. It's amazing that there's this big of an online community for REI. It'll definitely help a ton!

What are the best ways to educate myself about REI before my first deal?

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