Real Estate investing for an 18 year old

Real Estate investing for an 18 year old

Member since 2021 · 3 posts · 1 vote

A friend and myself are deadest on achieving financial freedom. We do not want to be forced to work for the rest of our lives and instead want to build our wealth starting early. We are both 17 years old and a Seniors in High School. I have 3,200 in liquidity and I estimate I should have north of 5,000 before the school year is over(we have been flipping furniture on Facebook marketplace and have made nearly 1,000 in the past 4 weeks). 

Both myself and my friend are deeply contemplating rental property investment when we turn 18. We project we should have somewhere around 10k cash by the time we both turn 18. Our market is around the flint area of MI and we are looking at purchasing a multifamily property. We are aiming for the nicer parts of flint with clean water, good schooling, and stable infrastructure. We are looking to buy a duplex, or triplex under 200,000 with either a fixed rate FHA loan or a 203k loan. We would be house hacking for 1 year and cosigning the loan. We have also secured a real estate agent who will only take 4% commission and who will guide us through the process.


Obviously our plan is very elementary in nature as we have analyzed a minimal amount of deals and are not entirely confident in our abilities to determine the ideal purchase. However, I'm looking for some advice from investors who also started early or have experience in some capacity. Maybe you could lend us a hand in our thought process and open our minds to strategies that would be conducive to our goals and financial constraints. 

1Reply
19 views

Most Popular Reply

Investor · Frederick, MD · Member since 2016 · 352 posts · 194 votes
4y

@Eli Keckeisen I was interested in RE at the end of high school as well. I'd recommend starting off with more education. Reading Rich Dad Poor Dad, Millionaire RE Investor, any of the BP line of books etc. Then solidify your RE investing goal (dont want to get tied up in a property that doesnt fit your goals). Then analyze as many properties as possible in your target area (youll get a feeling for good deals) and try to build relationships in your area. Then, take action. Goodluck!

See this reply in the discussion

4 Replies

Jump to latestLatest
  • Investor · Frederick, MD · Member since 2016 · 352 posts · 194 votes
    4y

    @Eli Keckeisen I was interested in RE at the end of high school as well. I'd recommend starting off with more education. Reading Rich Dad Poor Dad, Millionaire RE Investor, any of the BP line of books etc. Then solidify your RE investing goal (dont want to get tied up in a property that doesnt fit your goals). Then analyze as many properties as possible in your target area (youll get a feeling for good deals) and try to build relationships in your area. Then, take action. Goodluck!

  • Real Estate Consultant · Lansing, MI · Member since 2011 · 356 posts · 306 votes
    4y

    @Eli Keckeisen

    Good for you for thinking and planning at such a young age. I would say you're in the right place, and can learn as much as you want on this site. Spend some time researching how to buy properties without banks and you'll see there are several good avenues you can take. In addition, work to increase your credit score and try and find a local investor who might be willing to assist in your goals. Good luck!

  • Dan SheeksPro Member
    Rental Property Investor · Denver, CO · Member since 2016 · 621 posts · 362 votes
    4y

    Hey @Eli Keckeisen

    Congrats to you for your ambition! If you are looking to connect with someone for some guidance or advice, feel free to reach out. I also 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

  • Rental Property Investor · Manitowoc, WI · Member since 2016 · 178 posts · 186 votes
    4y

    You should start analyzing as many deals as you possibly can, even if you know they're no good. Do at least a couple hundred of these over the next few months so you can really get comfortable with what a good deal is in your area. You should be able to see a newly listed 3-plex for $xxx.xx and know right away whether it's a potential deal or just garbage.

    I started out in real estate with no experience, and in the 6.5 years since buying my first duplex I've analyzed thousands of properties and have a total of 35 units and a self-storage facility. I know every street in my city along with rents by neighborhood, and can tell within 2 seconds of a property being listed whether or not it's worth a second look. I'm sure a lot of other people on here can do the same which should show how important it is.

    Don't get ahead of yourself and spend this year really educating yourself on what a good deal is in your area and surrounding areas. Even if you're not interested in those surrounding areas it's all about the analytical experience. You should know the approximate monthly utilities cost for a duplex or 3-plex if not separately metered, how your purchase may or may not have an effect on the property tax bill the following year, etc. The often-forgotten details can add up make an ok deal a bad deal very quickly.

    Last, there are other low-down payment programs besides FHA. If you go 203k that's another story, but meet with a lender to discuss other options which won't require a refi to get rid of PMI. Also, I don't know about your market but with how fast homes are selling here a FHA offer is not very attractive to sellers because the property condition requirements are so stringent and they don't want to deal with headaches when they have 10 other offers.

    Feel free to reach out with any questions, I know if I had someone with experience to talk to when I first started I'd be much further along than I am now.

Join the conversationCreate a free account to reply, vote on answers and follow this thread.