100% committed to REI, advice on starting

[Bryan Byrnes]

Hello, I'm in my mid-twenties and am starting in real estate investing. I realize that I have time to my advantage right now and want to utilize this time as much as possible because we all know we don't get time back. I understand there are a lot of different ways to make money in real estate but I am most interested in buy-and-hold to build net worth. I would like to buy my first rental property in the San Antonio or Austin market as soon as I have found the right property and have 20%.

I am trying to save up money for 20% down right now. Have you ever gotten into a buy-and-hold property with less than 20% down? If so, how did you negotiate such a transaction?

Any advice/suggestions on what to do and not do when getting started on buy-and-hold investing would be greatly appreciated! I am motivated and determined to make this venture a success. Thanks!

[Seth Teel]

@Bryan Byrnes 

When I first started (while I was still in college) I bought a duplex using an FHA loan. I lived in one side and rented out the other. After a couple years and earning a little more money I was able to repeat the process with another duplex... and so on. Under FHA you only need to put down 3.5%. Granted you have to reside in the property yourself, but it's a great way to build net worth, earn passive income, and live rent-free (or close). FHA will allow you to buy up to a 4-plex, which means you may be able to produce good cash flow with low out of pocket. This may not be the strategy you were looking for but it worked for me over the last decade and allowed me to pay off a duplex, leave corporate america and invest in real estate full time. Hope this helps.