Rental Property Investor · Kansas City, MO · Member since 2020 · 1 post · 0 votes
I am 24 years old and just started my fourth book on investing and financial education. I am getting into real estate investing and hope to buy a duplex soon to live in one side and rent out the other to build more money for future investments. What is the best advice you have for someone who is looking to build a large rental portfolio but hasn't started their journey yet?
Make physical contact with industry experts. Start by finding a real estate agent from a reputable company. Most of the online sites list sales and rankings of agents in your area. Call the ones you like. The top agents probably wont have a lot of time for education, but you can get a feel for who is a full time agent. Just call and tell them you are interested in investment properties. A good agent will educate you and listen to your questions. Be wary of one that throws 200 houses at you and tells you they are all good deals.
That agent should be able to point you to worthwhile lenders. Call them and tell them what you want to do. Most will be able to give you options on the best way forward.
DO get a property inspection and DO get a survey. The money up front could save you exponentially in the end. An inspector can find things you are not experienced enough to find yourself.
In the end, you just have to go for it. My wife and I read and studied and researched and planned for what felt like forever. Getting out of that trap is the hardest part. Start with a small project. If you lose money, think of it as the cost of education. Our first deal didn't go the way we wanted, but we were way smarter when it was done. It was still cheaper than a college degree!
One of the greatest challenges I see is that investors over-hesitate, over-value risk, and get stuck in analysis paralysis. The duplex house-hack is a great way to start. Consider that even if you're not living for free, you'll still be paying significantly less than if you lived on your own. Even if it's not profitable in year one, consider the value you'll gain in experience as well as appreciation and rent increases that property will have over time.
Don't try to figure out your own taxes to save money. I'm biased here, but I strongly believe that a great CPA can help with maintaining compliance, understanding your finances and reducing taxes to free capital that can be reinvested. Also, team up with a good attorney, local banker and agent who are aligned with your goals.
Save money. Lots of it. Or hit the lotto, which ever is more likely.
But seriously though, too many people get all the knowledge about the game, but then don't have the pieces (money) to play. The first one is the hardest (financing wise), after that it gets easier.