I want to start investing but how do I start?

Question

Hey guys. My name is Andrew, Ive been a member of BiggerPockets for a few years now, and Ive "tried" to start investing in Real Estate several times.  I never put my best foot forward though, and never actually CONTINUED the process. I've gone to some meetups, spoken to some real estate agents, seen some properties, even purchased a Listsource and sent direct mail to property owners.  Even with that though, I wasn't persistent enough, hence why I'm here now without a rental.

11 weeks ago my fiancee gave birth to our first child, and I was ecstatic. I'm also scared out of my mind.  I'm 30 years old and we live in an apartment thats already too small for us and our dog, now there's a child to add to the mix.  Needless to say I'm actually devoted with proper motivation to start up this real estate venture for real now.

Here's my problem:

I live in Long Island NY.  The entire Tri State area (especially NY city) is the hardest hit from Covid-19.  We are currently in lockdown until May 15, and who knows what the local government decides then.  I don't have much of my own money, so my best bet is to go out and talk to people, through here and in person, and put boots on the ground as much and as well as possible.  Considering my current situation, what do you guys recommend my course of action to be?

Frank Rubino · Answer

Maybe you and your fiancée should save up money for a down payment on a duplex/two-family home. Move into one half of the house and rent out the other half. You'll solve two problems - you and your family will have a larger and nicer place to live and you'll break into real estate at the same time.  Using this strategy you might be eligible for an FHA mortgage which only requires 3% down.

Alex Olson · Answer

Build up your linked in profile. Connect to investors in your area via linked in. Write your story and get it out there. Create a website on Google or use wix. I am not sure of all of your goals but you have to know what real estate "stuff" you are doing. I hope this helps.

Vanessa Regalado · Answer

@Andrew Ceris I would take this time to really set up a business plan with goals and deadlines. Align a good list of vendors that can help your future real estate business. I agree with some of the comments to start with buying a multifamily property where you can live in one Unit and rent the others. Ideally, a 2-3 family home would be great. Be very selective on choosing the right tenants and start learning from now what tools and processes you will need to handle your first rental property. Do not be afraid to start your business, but be selective and cautious. Wait a few months, the real estate market is a little unstable but a few months from now it would be a buyer's markets with great investment opportunities.

Good Luck!

Twana Rasoul · Answer

@Andrew Ceris no problem. To help you gain more purchasing power, go after a duplex. The lender will look at the rent from the second unit as additional income for you which will help you substantially increase your buying power vs what you’d be approved for on a single family home.

Best of luck to you and the family!

Anthony Dooley · Answer

It sounds like you have enough stress in your life at the moment. A rental would add to that stress. Work a lot, save money, and learn your market by looking at deals. Don't rush to failure. Be patient enough to wait for the right opportunity, which will be off-market. Real estate agents only deal with listed properties, so they will not be much help.

Twana Rasoul · Answer

@Andrew Ceris use an fha loan with 3.5% down to purchase a 2-unit for your family to house hack unless you qualify for a VA loan. Don’t waste time on looking off market or other strategies if you haven’t purchased a place of your own yet.

Best of luck!

Adolph Bellamy · Answer

@Twana Rasoul I’ve realized that it seems a waste for me to look off market because I may not have the means to purchase. Usually those deals get bought up straight cash (from what I have seen) and I am not that liquid right now. The idea for the househack I would love as a starting point especially because it kills two birds with one stone. My concern with that is making sure that my fiancee and I get pre approved for a price range that is feasible in NY. I eill most definitely start to make moves towards this end though, thank you!

Adolph Bellamy · Answer

@Anthony Dooley I appreciate the advice. I will say that I spent many an hour looking at deals here and in New Jersey. My mother has invested as well so I believe that ai have her and our neighbor to help find good deals and not something I will fail in. Having said that, yes you are 100 percent correct, I need to know my numbers and not rush to failure. Thank you!

Adolph Bellamy · Answer

@Frank Rubino I would love to do so. When I spoke back in the day with real estate agents, they would always ask me to get pre approved first before we can talk seriously about purchasing properties. I believe when I last did so, I was pre approved for a property at around 300k. It is quite difficult to find said properties around me in NY that are worth buying, so I guess the next question is, do you have any idea where I would go from here?

Adolph Bellamy · Answer

@Alex Olson Thank you. I think of all the things I thought of, I never thought of using my Linked In (I have one of course).  You mentioned you dont know my goals. Short term I would like to househack a multifamily (there are few in Long Island and I need to get my lady on board to live elsewhere in the state to find a 2-4 unit). Long term is to own something like 100 doors. That should get me to about $10,000/month cash flow, plus the properties themselves once they are paid off will do nothing but increase my networth, and I would reach financial independence.

I want to start investing but how do I start?

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