A Bit of Advice Before Buying My First Property

[Account Closed]

Hey BP, 

Now that I'm a few years through college and my mom has sold her house to move to a less expensive area, we have some capital we'd like to use to create passive income through real estate investing. Since we've gotten serious a few weeks ago, I've pored over Rich Dad books, Morris Invests' YouTube videos, Podcasts, and of course the BP forums and Webinars. It's been so enlightening, but its still a bit scary and confusing, so I'd like to ask you guys for advice in taking the very first steps. 

We live in Maryland near Washington DC, and have about 100k to buy our first property outright; it has to be fully bought, that's mom's rule. In a few years mom will retire and move, probably to Florida. 

Morris recommends buying a house worth ~$50k after renovations, in a C-class neighborhood, since these will have the best cashflow. I'm wondering about a few things:

- Should I buy out of state, so the markets and location and landlord laws are better, 

  or near where we live, to simplify the process so our first time goes more smoothly?

- Is it better to try to buy a house that needs work because it might be a better deal, 

  or that is already in good condition, so our first time goes more smoothly?

-Should we set up an LLC for this first house so it's protected,

 or is it better to wait until later to simplify things?

- After we've found a property we like, what's the best way to assemble a reliable team, especially if the property is out of state? 

And I'd love to hear any other advice if you have it. 

Thanks so much,

Shafi 

[Mike Malfitani]

Originally posted by @Account Closed:

Hey BP, 

Now that I'm a few years through college and my mom has sold her house to move to a less expensive area, we have some capital we'd like to use to create passive income through real estate investing. Since we've gotten serious a few weeks ago, I've pored over Rich Dad books, Morris Invests' YouTube videos, Podcasts, and of course the BP forums and Webinars. It's been so enlightening, but its still a bit scary and confusing, so I'd like to ask you guys for advice in taking the very first steps. 

We live in Maryland near Washington DC, and have about 100k to buy our first property outright; it has to be fully bought, that's mom's rule. In a few years mom will retire and move, probably to Florida. 

Morris recommends buying a house worth ~$50k after renovations, in a C-class neighborhood, since these will have the best cashflow. I'm wondering about a few things:

- Should I buy out of state, so the markets and location and landlord laws are better, 

  or near where we live, to simplify the process so our first time goes more smoothly?

- Is it better to try to buy a house that needs work because it might be a better deal, 

  or that is already in good condition, so our first time goes more smoothly?

-Should we set up an LLC for this first house so it's protected,

 or is it better to wait until later to simplify things?

- After we've found a property we like, what's the best way to assemble a reliable team, especially if the property is out of state? 

And I'd love to hear any other advice if you have it. 

Thanks so much,

Shafi 

 Welcome to BP!

I'm a first time investor as well and started researching on the forums just like you are now.  My recommendation is to search out Morris Invest on this forum and make your own decision as to whether you feel it's a good idea to move forward with them.

There are other companies imo that appear to be much more promising for a first time real estate investment, however i must disclose that i have not bought from any of them; yet.

Curious as to why your mom insists the property must be bought outright?  Using leverage you could acquire several properties with your 100k instead of 1, which is what i intend to do.

Good luck!