How to start on real estate investing

Question

Hi guys,

I've been reading about investing but I need more information about how to start or the tools that I need to learn more before taking any course

John McKee · Answer

Walk into your local banker/underwriter and buy them lunch.  Tell them what your trying to do and ask him how it works.  Once you understanding the financing side on how banks view rentals then you can proceed forth to step 2.

Leo R. · Answer

@Luis Fernandez it's not really possible to give you much personalized feedback with no information about your current circumstances and your goals.  Asking "how do I get started in REI?" is a bit like asking "how do I get started in exercise?" (well, that depends on things like: your current fitness level, your age, whether you have access to a gym, your preferred exercise routines, your preferred diet, whether your goal is to build strength, increase stamina, lose weight, etc., etc., etc.  --there are countless potential answers, and it all depends on what your current circumstances and future goals are).

For instance, we'd give completely different feedback to a person who has $50 mil in cash who wants to build a portfolio of triple net in Seattle versus a person with $10k cash who wants to house hack a single fam in Kansas.

If you don't know what your goals are, study up on the various REI strategies to figure out which makes the most sense for you (personally, I think house hacking is the best way for most beginners to get started).

Once you have a better idea of what your goals are, and you're able to provide more specific info about your circumstances and goals, then people on the forums will be able to give you much more personalized feedback.

Good luck out there!

Alfath Ahmed · Answer

Hi Luis Fernandez ! Welcome to Bigger Pockets. The world is your oyster and if you can think something then you can do it as Napoleon Hill mentioned in his book "Think & Grow Rich". That is the concept that I lived and still live by.

I would first recommend finding your core 4 and reading as many bigger pocket books as you can. I personally read "BRRRRR" by David Greene and "Multi-Family Millionaire" Vol 1 & 2 by Brandon Turner. Those 2 concepts will really help you grasp how to get started in real estate and SCALE SCALE SCALE!

If you are house-hacking, I would choose a B+ location or better because you will not get too many opportunities to house-hack. You can use an FHA loan conventional 5% down loan (Find one without a PMI) that has great loan terms.

Leo R. · Answer

If you're looking for financial education, there are a million and one resources available...I don't personally have a favorite, but perhaps some of the finance pros on here do (I'm sure it's been discussed in the forums--so you can probably find some suggestions if you dig around).

However, I will say this: if you're a beginning real estate investor, your deals should not require advanced financial skills.  Your first deals should involve relatively straightforward, basic math --basic things like ROI and money in versus money out. It doesn't take financial genius or extensive education to understand the fundamentals of real estate investing financials.

What DOES take quite a bit of practice and education is learning about all the other things that are involved in REI  --things like thorough due diligence, understanding value add potentials, understanding tenant demand (or lack of demand), understanding what types of tenants do (and do not) rent certain types of properties, knowing how to screen and manage tenants, understanding how to spot problems at a property before you buy, understanding the costs of maintaining a property, etc., etc.  You can learn a lot about these topics through educational materials (and I would definitely suggest studying up), but at the end of the day, a lot of this stuff can only be fully learned through experience and the school of hard knocks.  You can prepare yourself to learn to swim by reading books, but ultimately, the ONLY way to learn to swim is to get in the water.

Good luck!

Luis Fernandez · Answer

Hi @Leo Ray,

Thank you for commenting on my post. I stared to read about real state two week ago, and I’m interested to learn more and educate myself before hiring a coach/mentor. I’d like to be able to understand what I’m getting into. I’ve been reading a couple books before. However, If you can or someone can point the right direction to financial education, It will help. I know it is a long process and I’m not pretending to be reach overnight. I want to be able to create my plan and work on it.

Dave Skow · Answer

@Luis Fernandez consider using a  hypotehtical  scenario  and getting pre approved for this scenario ......this process is free and doing this  will allow you to learn  a lot

Patrick Drury · Answer

@Luis FernandezYou are definitely in the right place to learn about investing. Ask questions and learn. I highly recommend you attend local meetups or join a local REIA near you so you can meet in person with local investors and network with them. Find a mentor that is where you want to be and learn from them. Find a way to add value to them in exchange for their time and knowledge.

Eliott Elias · Answer

You need nothing but ambition and consistency to start. Have a long term mindset, real estate will not make you rich overnight. Stick with it

How to start on real estate investing

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