New investors.. how do you find help and advice?

Question

I have been educating myself on real estate investing recently, reading  books, listening to podcasts.. and I’m overwhelmed. So much information I’ve consumed over the past few months.. ! many people tell me to find other investors who have been doing this for a while to get some advice and help from. I go to meetups here in Houston to meet and network with people. But I also know that not many are willing to spend their valuable time with a very green investor which I completely understand.. I work full time in the healthcare industry which limits my free time to after work and weekends.  I know that you should offer value to an investor so you can gain knowledge from them and actually build a relationship with them and honestly, I would be happy just shadowing someone for free but im having difficult finding people who are willing. How do you guys do it? How do i find and build these relationships other than Just going up to an investor and asking them “ can i please follow you around..??”

Josue Vargas · Answer

Just an opinion, you should never feel the urge to do something you are not familiar with or something someone else tells you is wrong or wright... I feel like you should take the "you need" or "you should" stuff as an advice only and do your due diligence.

In my experience and opinion only;

I would never try to meet with wholesalers first if you do not understand the business.  They will likely fill your eyes with gold, were there is no gold... And they will know you are an easy pray... this is a place for some more savvy investors.  There still some good wholesalers, I still skip them mainly because of my business model.  Brokers... depends on what kind of broker... Careful with the word broker.  I have several brokers on my business, none of them strictly related to each one... i.e. I have one broker for insurance and one for Real Estate Investment (REI).

As a buyer, you don't need to go to YouTube... Your best bet is a good Broker/Realtor (experienced in REI) that understand your needs.

And it really depend on what you are investing and what you can get from it. Not all strategies works for someone.  For example I'm terrible at flips, because I do not have the time, while I still know contractors, I just can't do it and is a high risk I'm not willing to take.

Deals... you can still find good deals on the market while they are sitting for weeks... The majority of them are gone in few days, or hours, but depends on the market... You will know this better when you are fully looking and putting offers out there.

Russell Gronsky · Answer

@Menal Khan, I second what @Josue Vargas said. Stay away from Wholesalers on your first few deals. Most of them are as new as you are and have no clue what they are doing or selling. Also, some of them will try to take advantage of you for being new.

Here is a more practical guide:

1. Get your financing lined up. Meaning, get qualified for a loan from a bank so you know how much you can afford and have financing as close to "Ready to deploy" as possible. You don't want to be scrambling to find funding when you have a deal.

2. Practice analyzing deals daily. As you search for properties online, pick 2-3 a day and analyze them. The more you practice this, the better you'll get at seeing what the market is offering, how far apart you are from the numbers being throw out by sellers and you'll have a better understanding of what a good deal looks like, when you come across one.

3. Make offers. After you analyze the houses you find, make an offer based on the numbers you think the property is worth. You'll get rejected a lot but you may find someone who negotiates with you, or even agrees to come off their price/terms. Even if you don't end up closing the deal, this will be extremely valuable experience to you and you'll get familiar with the process of offering, negotiating and even some of the purchase process as you may end up under contract but it may fall out of contract during your inspection or financing timelines.

Even if you haven't closed any deals, when you analyze many of them, make offers, go under contract and proceed through due diligence, inspections and lining up financing, you'll start talking like you know a thing or two and that's when you'll start attracting interest from the experienced investors as you'll have skills to look for deals for them in exchange for letting you shadow them on taking the deal from offer to actually stabilizing the property and filling it with renters.

Brian Ellis · Answer

You will learn the most through action, like some one else mentioned. That’s when you build your “team”, and learn along the way. You’ll never know what to do 100% of the time.

If you know which direction you want to go, you can always get reassurance here on BP. People will be more then happy to give you advice.

Luciano A. · Answer

@Menal Khan

I’m fellow investor here in Houston. PM me and can introduce you to a few investors doing different things in RE so you can figure out what might interest you. From lending money as hard money, buy and hold,flip to building. I am a full time investor. Be happy to help

Nate Shields · Answer

@Menal Khan

If you're feeling overwhelmed, keep educating yourself until you feel more comfortable. You'll never feel entirely comfortable, but you're going to make poor decisions if you feel like you're in over your head. Even though I was already involved in real estate, it took me a while to get to a comfort level where I felt like I could pull the trigger on a deal.

Always be networking and you'll learn a lot from other investors.

Feel free to reach out with any questions. The BP community is outstanding!

Menal Khan · Answer

Thank you for the advice everyone!

Anthony H. · Answer

You need to pick an area to focus on. Drive by to have a feel for it and then start looking for properties online. You can work with a realtor or get off market deals from REI meet ups. Run your numbers (the BP calculators are useful) and decide. You can always ask over here for advice on a specific deal.

Shahriar Khan · Answer

@Menal Khan you are doing the right thing which is going to Meet up and probably need to sharpen "the group of folks" you want to meet there

1) As a buyer you need to have properties coming to you so when you go to meet up try to meet with wholeseller (initial focus) and then brokers (secondary focus)

2) As a buyer you need to know your numbers . Go to Youtube and understand how to do rental analysis

3) As a buyer you need to know which area you want to invest. Pick an area that you feel comfortable (remember better the neighborhood less then cash flow) ..

4) As a land lord you need to know know you rental comps . Go to MLS.com /Zillow/Apartment.com and create a range of rents . Use the low end of the number.

5) Go to MLS.com and find properties in that area and sue analysis from step #2 above to see if you can make the number work

6) When broker/wholesaler sends you a deal that you like. Buy it QUICK.. In general good deals goes FAST .

Wish you the best.

PS: I am assuming that for the first deal, a major rehab will not be in the scope.

Menal Khan · Answer

In Houston, im interested in buy and hold properties for rental income.

Anthony H. · Answer

@Menal Khan At some point I think you have to take some actions. Reading , listening to podcasts is great but once you have established your goals you have to identify a property and practice!lol! or just pull the trigger.

Do you plan on investing locally in Houston or out of state?

New investors.. how do you find help and advice?

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