How does one define their "criteria"?
New to Real Estate · Seguin, TX · Member since 2021 · 5 posts · 0 votes
How does one define their "criteria"?
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Alecia LovelessPro Member
Member since 2019 · 3k+ posts · 2k+ votes@Chris Shelton For me it was a matter of personal preference which has evolved as time has passed. I chose REI because I had nothing saved for retirement and my parents made a lot of money at it.
A duplex presented itself and through years of blogs, podcasts, research during the dark ages if anyone remembers Carlton Sheets, and I cunningly took advantage of the Sellers weak points and stole the deal at a great price.
Then my Realtor presented me with a great SFH. It has turned into a flip.
I realized I had to expand faster and began scouring the MLS for another deal. I happened to look outside my preferred area and found a 4plex. This was in December. It is true great deals can be made/found in December. I've had great luck.
My realtor told me about a listing he was working. He showed it to me and I made a full price offer before it went on the MLS. After the inspection I lowered my offer by $100,000 and the Seller accepted.
My criteria started out as getting into the game with no real end point other than to have enough money to retire. Now it’s 3-4 units(my area doesn’t really have much larger) that either don’t need a lot of work or I can buy for a huge bargain. My goal is to acquire 30 more units by my 50th birthday in about 3.5 years. Last night, 2 years in, I sat down with a note pad and calculator Andrea figured out exactly what my expenses were and would be going forward and how much I’d need to make passively each month for both myself and my wife to quit our W-2 jobs and be comfortable.
Defining your criteria may include things like do you want to manage a small local portfolio yourself, or plan to allocate 10% and hire a property management company? Or would you rather invest in a REIT and be totally passive? Or are you an accredited investor and you want to invest in someone's large scale syndicated deal?
I’d recommend sitting down with a pen and paper and first think about your why. Why you want to invest in real estate. Then think about your how. How you’d like to accomplish it that best fits in with your goals, lifestyle, and family. Then you can think about your criteria whether it’s for property you want to own, REITs you want to investigate, if you want to wholesale, do flips, etc.
You can always change your goals and grow your plan as you begin and learn and evolve.
6 Replies
- 5yAlecia LovelessPro MemberMember since 2019 · 3k+ posts · 2k+ votes
@Chris Shelton For me it was a matter of personal preference which has evolved as time has passed. I chose REI because I had nothing saved for retirement and my parents made a lot of money at it.
A duplex presented itself and through years of blogs, podcasts, research during the dark ages if anyone remembers Carlton Sheets, and I cunningly took advantage of the Sellers weak points and stole the deal at a great price.
Then my Realtor presented me with a great SFH. It has turned into a flip.
I realized I had to expand faster and began scouring the MLS for another deal. I happened to look outside my preferred area and found a 4plex. This was in December. It is true great deals can be made/found in December. I've had great luck.
My realtor told me about a listing he was working. He showed it to me and I made a full price offer before it went on the MLS. After the inspection I lowered my offer by $100,000 and the Seller accepted.
My criteria started out as getting into the game with no real end point other than to have enough money to retire. Now it’s 3-4 units(my area doesn’t really have much larger) that either don’t need a lot of work or I can buy for a huge bargain. My goal is to acquire 30 more units by my 50th birthday in about 3.5 years. Last night, 2 years in, I sat down with a note pad and calculator Andrea figured out exactly what my expenses were and would be going forward and how much I’d need to make passively each month for both myself and my wife to quit our W-2 jobs and be comfortable.
Defining your criteria may include things like do you want to manage a small local portfolio yourself, or plan to allocate 10% and hire a property management company? Or would you rather invest in a REIT and be totally passive? Or are you an accredited investor and you want to invest in someone's large scale syndicated deal?
I’d recommend sitting down with a pen and paper and first think about your why. Why you want to invest in real estate. Then think about your how. How you’d like to accomplish it that best fits in with your goals, lifestyle, and family. Then you can think about your criteria whether it’s for property you want to own, REITs you want to investigate, if you want to wholesale, do flips, etc.
You can always change your goals and grow your plan as you begin and learn and evolve.
- Investor · Member since 2021 · 54 posts · 15 votes5y
Hi Chris,
I like you I have also wondered the same, but after watching the 90-day Challenge webinar and reading a few books, some of the points you want to consider are the Niche: SF, Multifamily, Office space, retail, etc., and also your strategy: Wholesale, fix and flip, BRRRR, etc. Also, consider what market you want to be in, local market or venture to long-distance. This is in addition to what you mentioned, the numbers, your expected cash-on-cash and all other metrics. I hope this helps.
- 5yBruce WoodruffPro MemberContractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
Criteria can be as simple as: what type of property do you want? STR, LTR, MTR, FLips, BRRR, Multis? And why do you think you want that type of property?
Then, what is your financial deal? Do you have savings, or do you need a lender? What type of lender? How much do you want to make as ROI?
Are you handy? Can you do a good portion of a potential rehab yourself? (Be honest with yourself...:-)
Once you get real with these facets and others, you will find your particular niche and comfort level and your criteria will be more clear. They will change as you grow though.....
- 5yDrew SygitBusiness MemberProperty Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
Do a SWOT analysis of your resources- Write down your real estate goals
- Pick an asset type: SFH, 2-4 units, 5+ units, or something else like MHP.
- Pick an asset class: Class A, B, C & D properties, research pros & cons, pick one to focus on
- Pick a real estate market that matches your resources & goals
- Contact local agents & PMC’s to start sending you listings to analyze
- Analyze a few deals weekly, get comfortable with the market and refine what you're looking for
Logical Property Management4.9451 Reviews - 5yPaul MoorePro MemberCommercial Real Estate Fund Manager · Lynchburg, VA · Member since 2015 · 1k+ posts · 1k+ votes
Hi @Chris Shelton. The training and podcasts you’re getting from books is wonderful. Often, your best training will come from a personal mentor. I recommend you try to link up with someone in your market or even elsewhere who will personally guide you through the process depending on your asset class and strategy. Happy investing!
- Investor · San Diego, CA · Member since 2017 · 75 posts · 30 votes5y
@Chris Shelton.. the question is what do you want to do?
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