What is the first steps?

Question

Hey guys,

Just hopping onto the forums again to attack the idea head on. I just want to hear everyone's first step(s) towards getting the first investment property. I have been researching and reading a lot on REI for the past year but I enjoy hearing what people have done instead of reading the "most efficient ways" of doing things. I am located in the greater Los Angeles area but I'm open to relocation for work (to pay for my investments till I can live passively).

Tell me the good, the bad, and the dirt-y (see what I did there?). Even if you began with a empty lot, I'd like to know it all.

Feel free to contact me and agents, feel free to help me!

Nathan Gesner · Answer

My first investment was a hoarder house. I was listening to a lot of podcasts, reading a lot of books. Brandon was talking about how to find deals and suggested telling everyone what you are looking for. So I started telling everyone I was looking for a cheap fixer-upper, single-family, under $150,000 (average market price at the time was $250,000). After a few months, another REALTOR approached me with a hoarder house. The Sellers were embarrassed and didn't want the house on the market where people could see it. They wanted a ridiculously low price, so I agreed to purchase it for $55,000 and gave them up to six months to clean it out. They were out in three months, I spent six months renovating, and a year later it was cashflowing and valued at $175. It's now worth $275.

Daniel Brewer · Answer

You'll hear a lot of stories about people doing well on their first investment property. I am not one of them but I love sharing!

My partners and I bought a destroyed home in probably one of the hardest parts of the country to invest in. Thankfully we paid for everything in cash. But we dealt with it all. Shady contractors, incorrect quotes, people constantly trying to get more money out of us. It was awful. Fortunately, the prices of the homes in the area went up drastically so our refinance was not all that bad.

What I would recommend is that before you begin anything, create a document that outlines every single thing you are going to do from start to finish. How you are going to do it, some tips from your research (such as how to pay contractors and what material to use in the bathrooms), etc. It's really easy to do all that research and then once you're caught up in the investment you get ahead of yourself and it all goes out the window. It's like practicing free throw shots and making 10/10 but not being able to make any in the big game.

Again, spend days (or weeks) writing a very specific set plan on a word document and stick to it!