EXTREMELY Unique Position- What would you do if you were me?

Question

Hey Everyone! First time poster here, and I’m in a very unique position as a first potential first time investor.

I’m a 26 year old man who is a US citizen living abroad in Melbourne, Australia. Recently, I just appeared on a game show and won the grand prize of $136,000 USD. After paying off the entirety of my credit card and buying a used car, I plan on using the rest to invest in real estate (will be roughly $115-118k). I plan on investing in residential property around my hometown in Kentucky, as that’s where I have connections to people who can help. (I know several real estate agents and renovators/tradespeople, as it seems like 1 in 10 people from where I’m from are one of these things).

I currently have average credit, but once I’m able to fully pay off my credit card debt, I imagine it will be pretty decent- pragmatically I’d say in the high 600-low 700 range. I work a job I hate at the moment, but am about to transition into warehousing once I have the appropriate licenses as it’s not as time consuming as my current job and will allow me to earn a similar wage to what I make now. I guess what I’m saying is even though I will still have income, I’m not gonna be able to do myself a lot of favors when it comes to loans at the moment since I don’t have a really high paying job. But just like everyone else on this website, I dream of real estate investing to be my primary source of income one day.

My initial plan is to try to flip a couple of very small houses upcoming rural areas in Kentucky that I will finance outright with my own money, then use the income to serve as my reserves for rental property investments. Then I’ll start buying rental property as I’m able to in the central Kentucky area. I’ve read The Book On Rental Property Investment so I am familiar with the idea of leveraging my properties, which I plan to utilise.

The reason I’m posting on here is because I’m having a lot of trouble finding specific advice related to investing in my target area (or just America in general) seeing as I live overseas in one of the richest places in the world. I just wanted to know; if you were someone who was in my position, how would you play this roughly?

Thanks for reading guys, any and all advice would be greatly appreciated. 🙏

Sandra Morrison · Answer

I live in northern KY and invest in Ohio and central KY. I would be happy to help in any way I can.

Antonio Cucciniello · Answer

@Robert Bird Did you just say you are having trouble finding information on how to invest in America? I feel like that's where the most information is on any country!

Anyway - if you wanted to accelerate this. I recommend either doing a fix/flip first or a rental with the money you have. Learn the numbers about those and then transition to the BRRRR method.  This way you can get your money working for you at an even faster rate! I just don't recommend starting with the BRRRR method because it is complicated for a beginner.

Sebastien Hitier · Answer

Congrats @Robert Bird, as you say that you are a US person, do you need to keep some money to pay US federal tax on game-winning at income tax brackets?

Lindsay Stewart · Answer

Congratulations @Robert Bird!  What a great opportunity :)  I live in Australia and would be curious which game show you won!?  Not that I guess I watch a lot of television, hehe

Investing in the U.S from AU is certainly possible.  The key is  getting a good team on the ground in the area that you are looking to invest in.  As a U.S. citizen it will open a number of doors for you that we, as non resident, foreign aliens don't have.  Access to funding etc will be advantageous to you.

Just make sure to do your due diligence on the people you bring onto your team (realtors, contractors, Property Mangers etc) as you would the properties and areas themselves!

Best of luck!

Cheers

Lindsay

James Wilcox · Answer

@Robert Bird yep. Just DM me dude. I can help you out.

Antonio Cucciniello · Answer

@Robert Bird what information were you trying to find?

Remington Lyman · Answer

Which parts of Ohio?

Jonah Kolsrud · Answer

@Robert Bird

First off, congrats on your stroke of luck and welcome to BP forums! Consider it a stroke of luck you found this platform before winning the game show also!

If I were in your shoes, I would recommend reading a few books on REI (I would recommend Set For Life by Scott Trench and The Book on Rental Property Investing by Brandon Turner). I would second recommend listening to the podcast episodes. Starting here will build your foundation to make a great first purchase and mitigate risk of jumping into a deal too quickly. While you may have just found some wealth quickly you want to avoid losing it quickly also. There is no shame in taking a few months to build a good platform to accelerate your investing career off of.

Third thing I would do, once you get over educating, is to build a criteria for what you want to invest in (1- property type, 2- location, 3- condition, 4- price range, and 5-profitability wanted) and also your strategy (being a first timer, house hacking is arguably the best intro into REI and it will only cost 5-10% down payment while also having tax benefits when going to sell). Once you have these things to a tee, start analyzing deals and making offers with an agent.

This is just one path you could take, there's a million different directions you can go in REI so be wary of each and always keep the end in mind! Focus on what makes you happy and you will always be on the right path.

Robert Bird · Answer

@James Wilcox

Hey James, thanks for the info. That’s more or less what I am worried about as well. I have several family members in both of those areas (don’t know about how good of work they do) but as I think about it, it’s probably best to leave family out of it altogether.

I see you’re in sort of on the cusp of the target area where I’m looking to start so I’d love to be able to pick your brain about other things in the future or some data for certain areas if you’d be willing to help.

Robert Bird · Answer

@Antonio Cucciniello

Sorry, probably should’ve been more specific. I meant as in I was having trouble finding information about the area I’m looking to invest (central Kentucky) from investors in that area.

But just looked up BRRRR method and will definitely keep that in mind for the future. Thanks a lot!

EXTREMELY Unique Position- What would you do if you were me?

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