Getting off the Ground

Getting off the Ground

Harvest, AL · Member since 2014 · 8 posts · 3 votes

Good afternoon everybody!

I've lurked here for a bit here and there, but I've decided to take the plunge and post.  I'm not really sure where to begin and would welcome any sage advice.  I've had a successful corporate career for some time that affords me a pretty good income.  Combine that with my wife's exceptional ability to manage money, and we've built up a decent pool of capital that we'd like to put to work making better than the 10-15% / year we're getting out of traditional investments.  

I've looked into a few things that can be done while continuing in the day job, and the idea of investing in real estate keeps bubbling to the surface.  I love the idea, but don't have a clue where to begin.  Whenever I see success stories, they usually involve boot-strapping, or leveraging somebody you know from somewhere to give you some opportunity that you were able to martial forward to get the snowball rolling.

  • We don't really have a network of people (friends and family are all in different states)
  • We aren't Real Estate agents
  • I don't have any handy-man/rehab skills

This sounds bad to me even as I write it, but all I really have going for me to get started is funding and a sincere interest in learning and growing myself.  When I start running the numbers, money starts slipping away for all the services that I would have to pay for out of pocket, and I start getting lost trying to figure out how it works so well for everybody else.  

So, I've decided to try something different and ask.  Rather than trying to reinvent the wheel from other people's stories, maybe I can start my own here by asking you all directly for advice.  Do I have enough to actually get things going?  If so, where do I even start that takes things past what I might get from a forum or a book you can purchase about how to make money doing flips?

Thanks in advance!  I'm grateful for any thread that will help me get some momentum.

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Real Estate Agent · Tampa, FL · Member since 2020 · 411 posts · 373 votes
5y

Funding is the biggest road block most beginners face so you've got a great starting position. I would suggest reading up on the fundamentals of the REI craft in a book like Gary Keller's "Million Dollar Real Estate Investor" (and there are many more good ones out there but that's just the one I've read), and even a precursor book like "Rich Dad, Poor Dad" to get a firmer foundation of general financial acumen, and then once you get a general idea, strike out and buy a property. It's guaranteed not to be a perfect deal as there will be some minor rookie mistakes, but even with mistakes a cash-flowing deal is valuable not only for that cash flow but also the practical training it gave you, and appreciation value when it happens (either this cycle or next), on top of tax shelter value, act as bonus 1 and bonus 2.

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  • Real Estate Agent · Tampa, FL · Member since 2020 · 411 posts · 373 votes
    5y

    Funding is the biggest road block most beginners face so you've got a great starting position. I would suggest reading up on the fundamentals of the REI craft in a book like Gary Keller's "Million Dollar Real Estate Investor" (and there are many more good ones out there but that's just the one I've read), and even a precursor book like "Rich Dad, Poor Dad" to get a firmer foundation of general financial acumen, and then once you get a general idea, strike out and buy a property. It's guaranteed not to be a perfect deal as there will be some minor rookie mistakes, but even with mistakes a cash-flowing deal is valuable not only for that cash flow but also the practical training it gave you, and appreciation value when it happens (either this cycle or next), on top of tax shelter value, act as bonus 1 and bonus 2.

  • Rental Property Investor · RVA · Member since 2016 · 5k+ posts · 4k+ votes
    5y

    The dirty little secret is that most of us didn't start with a real estate network. We go out and build networks! :)

    Many, but not all, investors are not agents (I'm not). 

    Many of us are not great handypeople - I'm so-so. 

    BP has great books by J Scott on how to flip properties and running the numbers on flips. Check those out for sure. Then get out and go build your network! It takes time, but as an established professional you likely have good people skills and an understanding of your industry. Those people skills will translate to real estate as well!

    As @Ronald Allen Barney said, many investors struggle with funding. You have that bit handled. Focus on taking stock of what you do bring to the table, rather than what you don't yet!

  • Owen DashnerPro Member
    Lender · Omaha, NE · Member since 2008 · 1k+ posts · 1k+ votes
    5y

    Your first steps need to involve networking. Join your local REIA, find all of the local investor meetups that exist and join them. Look in Facebook groups for active investor pages and join them. If you don't find one you are looking for, start one of your own. I cannot stress this step enough. You will meet key people at these events that you can develop relationships with over time and who are critical to building a good business.

    Set a goal to take a new investor/agent/contractor/lender out to coffee or lunch every single work day.  Keep doing that alone and things are going to quickly gain momentum for you.

    I would also recommend that you get up to speed quickly on knowing how much properties are worth. The best way to do this is to find properties that fit what you are looking for on the MLS, and get showings from listing agents (so that you don't burn out a buyer's agent showing you 50 properties without buying anything). Go through a LOT of houses until you know exactly what a house/property is worth just by standing in it because you have seen so many of them. No shortcuts for this one. You need to understand values, and the only way to do that is by seeing them and analyzing them.

    Networking and analyzing deals are my 2 best things to focus on for newbies.  Just don't get overwhelmed, break it down into manageable steps and you will make progress quickly.  Best of luck!

  • Harvest, AL · Member since 2014 · 8 posts · 3 votes
    5y

    @Account Closed - I'd love to learn more.  Please send me a direct message.

  • Lindsey BuxtonPro Member
    Denver, CO · Member since 2020 · 111 posts · 97 votes
    5y

    Hey Jon! There's a lot to take in when getting started. Wanted to share that BiggerPockets is launching a pro-exclusive 12 week Rookie Bootcamp in late August, with Ashley Kehr leading the way. It's a mix of on demand videos, live Q&A sessions, and a step-by-step curriculum to help you get your next deal. Sharing in case it would be helpful to get the wheels turning and create some structure to diving in! Pro annual members can sign up here.

  • Harvest, AL · Member since 2014 · 8 posts · 3 votes
    5y

    Thanks Lindsey!  I'm actually already signed up for it!  Very much looking forward to it.

  • Real Estate Agent · Los Angeles CA + Lake Tahoe, NV and CA · Member since 2021 · 180 posts · 158 votes
    5y

    Depends what you mean by "decent pool of capital". It would be nice if you could leave at least two moves on the board and get started with something to learn on and go from there. You don't want to be out of the game before you give yourself a shot. Analysis Paralysis slows a lot of people down, so just start. Merely fill every moment you used to do other things- with RE machinations and you will crush it! You obviously understand business so you will be fine. 

    In response to your direct questions

    • We don't really have a network of people (friends and family are all in different states)

    -You and your awesome wife are already a network. You can build a team you don't need it to be a party atmosphere day 1, just knock a couple out, and you'll meet plenty of people.

    • We aren't Real Estate agents

    -Great, interview five agents and pick the who understands your goals. Make them earn your business and anyone who may condescend about your level of experience, show them the door. 

    • I don't have any handy-man/rehab skills

    -You don't need to be a handyman, just pick someone in your family to be the "yelp master" and go forth! I would suggest think about starting with a renovation/ value add/creative expansion and wait for a big "flip". I've seen flips fail, I've bought failed flips.  It can be a money pit and the housing market is so hot the margins may not work for you in your area as they are described from peoples experiences 2-5 years ago. 


    All the best!

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