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How can a college student, with very little money, get started?
I am a college student with only a couple thousand dollars in savings (and I do not have any student loans to pay off), but how could I start getting involved in real estate? I am studying for an engineering degree, so I know I’m not going to be able to put a lot of time and effort into it yet, but any advice on how to begin learning and meeting people is very much appreciated (and hopefully there are others in a similar situation who could learn from this discussion, as well).
@Kade T. Brunson Find a deal. A real deal. All your other problems can be solved by the good deal.
70 to 75% ARV minus repairs.
Youll get all the money or partnerships youll need
@Kade T. Brunson I would love to listen to your podcast on how you were able to finance a deal for 4plex while in college send me the link.
@Kade T. Brunson i started about 4 years ago in your shoes. i now have 6 rentals and over 22 flips. 2021 im on path to brrr 6 houses. best advice is dont push the deals and get money in real estate. find the deals, learn how to evaluate it so that you can hold conversations with high level investors, get your real estate license to show you’re serious... basically ask yourself when you encounter an investor... are you worth their time? if not, what skills.. what knowledge do you need to accumulate to earn the money, the respect or whatever it is that you’re after
That is awesome that you are thinking ahead Kade! I would say educating yourself as much as possible. Reading what you can get your hands on. Rich dad Poor dad, Real Estate books geared towards the strategies you are looking to pursue, and also books focused on mindset is very underrated but can be the most powerful. Your mind is such a powerful weapon or can hold you back. You can find great books on Bigger Pockets as well of course. And going to different real estate meetups/webinars to start getting your name out there. Sometimes it is all about who you network with that makes the difference, not the amount of money you have or what you know. So getting exposure even if it is once a month will be more than worth the investment of a couple hours of your time. And when you start to have more time find a mentor through those events or in the local community and see how you can serve them. Go out and find deals for seasoned investors and you will make some money but most important learn from a pro. That would be my advice to start off. I hope this helps and best of luck!
@Allen Williams thank you Allen, and that does help a ton! Good luck to you as well, and I hope 2021 is your best year yet.
@Michael Noto thank you, Michael. I have read several books, such as Rich Dad Poor Dad, Brandon’s book on Rental Properties, and others. I was just looking for a way to get my feet wet, because there’s only so much reading and listening you can do before you lose it because you never do anything with it. I am willing to work part-time, and I would be okay working without pay to gain experience but the issue is I need to at least make enough money to pay for gas, going to eat, gifts, etc. (tuition, rent, and stuff like that are all covered by either scholarship or my parents helping pay for it, which I am extremely grateful for). What do you think I should do to get more involved?
@Kade T. Brunson Hey, thanks for starting this thread! I’m a sophomore at UCLA in similar shoes, and the replies here have been very relevant. I’m also looking to invest in real estate at a young age with limited capital. Best of luck!
Quick and dirty:
1. Finish getting your degree debt free. Pay off any other debts and do not think you're cool by financing or worse leasing a new car. Don't fall victim to thinking you "deserve" it either.
2. Locate job and rent for 6-12 months not in your mom's basement either.
3. Save up personal emergency fund 6 months living expenses. This should take you a couple months with no debt max.
4. Make retirement priority in this order, company match, Roth, traditional until you have 15% gross income budgeted for this. You may want to budget for life and disability insurance especially if you get married.
5. Save 20-25% for a downpayment on a house with 15 yr fixed loan. With your degree and depending on prices of house you could probably wait a little longer and buy it cash.
You want to build the little brick house. By house hacking with $2k in your pocket and getting mixed up with parents on a deal you're building a straw house that'll get blown down.
Good luck I hope you consider this advice but pretty sure you won't because this is slow and steady and we live in a microwave society and you're going to do what you want because you are chasing a fix similar to that of a gambler.
@Sam Arneson absolutely no problem! I’m so glad someone else is benefitting from this, as well. Good luck to you!
@Chris Pasternak thank you! I am willing to do whatever is best, and if that means waiting a few years, then that’s okay. I just created this discussion so that I and others in a similar situation can know where we stand and how much we should be doing, because we don’t hear a lot about people in our situation (and maybe for a good reason). With that being said, thank you for the advice and good luck with your investments in 2021!
@Kade T. Brunson
I am in the a very similar situation pursuing an engineering degree. Like some other comments suggested I am working to by my first househack this year. Househacking is an excellent way to start, but if you don't have enough money for a down payment the best thing in my opinion is education and networking. Setting aside a small amount of time within your week to network and self educate will put you in a position to have success when you have more time or money.
Partnerships are always a great way to get started as well. You can work out terms where take a smaller percentage of the deal and provide another investor with doing something they may need. You can make a partnership work with not a lot of cash or time if you find the right partner and a way to bring value to them.
@Devan Wilson that’s awesome! Congratulations in advance for the househack. It takes a lot to get started, especially under the circumstances you and I are in. I appreciate the input, and I’ll keep it in mind. Best wishes!
@Casey C. Have you used the FHA loan before?
@Kade T. Brunson Get a job in property management and learn stuff.
I am in a very similar situation. I think the best thing to do is to educate yourself as much as you can through books, podcasts, and reading the blog/forum posts. Also, try setting a goal to analyze a deal a day or a certain number of deals a week. That has helped me out a lot! Best of luck
@Kade T. BrunsonTalk to the owner where you rent about the option of owner financing!
@Kade T. Brunson get your license. wholsale. save up fix and flip. once you can afford buy your first multi. then 1031 into commercial.
easy on paper but years of work! goodluck :)
@Heath Ryans
Hi Ryan - any chance you can send me a link to the podcast? I am in a similar situation where I am looking to purchase an investment property while in college and am trying to evaluate the best possible financing options. Thanks!
@Heath Ryans
Sorry Heath - wrote Ryan by accident on my previous post.
@Kade T. Brunson congrats on taking the first step in REI!! Please read/listen to Brandon Turner's book on how to invest with little to no money down. As others have mentioned, house hacking will likely be your first step. Good luck and so great to have you here!
@David A. Hey David, I appreciate your input. I get what you’re saying about going to school, but I still want to be an engineer. Coming from someone who has wealthy family members (uncles on both sides of my family that make millions of dollars every year), money can’t buy happiness. Yes, they get to buy all the nice toys and go to some cool places, but every time I see them they’re always answering phone calls, emails, working on their computer, etc. even though they’re on vacation. It’s not always the quantity of life that matters, but the quality. I just want to build enough passive income that I don’t have to worry about a boss breathing down my neck or pleasing customers 24/7, but I can use my degree to do what I enjoy and maybe even combine with real estate. I don’t expect it to happen overnight or even in the next 10 years, but I definitely don’t want to work away the next 40 years doing something I don’t enjoy and not having any freedom. I hope I didn’t miss the point of your reply, but thank you for taking the time to point out something that may be of interest to someone else who is in a similar situation.
@Steven Wilson thank you, Steven! What you said is great and it’s exactly what I was looking for. Best of wishes for you and your investments!
Hey @Kade T. Brunson
Congrats to you for your ambition! I work with a bunch of young aspiring real estate investors just like you (in a free online group), and I am willing to help you out with some advice or even chat on the phone if you wish. But I first recommend you read this article I wrote for Bigger Pockets titled How to Invest in Real Estate Before Turning 21. Once you've read it, let me know your thoughts and if you have any questions. I am a high school teacher in Colorado and I am always looking to help young people get started in real estate investing or help in any way I can. Let me know if you want to chat sometime. https://www.biggerpockets.com/
@Dan Sheeks thank you, Dan! I just read your article and it’s a great, simple explanation on how to get started. It would be awesome if we could talk sometime and/or if I could join your group.
I would Google N.A.C.A.
I bought my first duplex with this program with 0 zero down and not great credit. I have 13 units now. The process is annoying but not hard.