20 Yrs Old where do I start?

Question

What's up BiggerPockets, I'm 20yrs old my name is Augustine. I currently work in the oil field. I have been looking to get into the game for about 6 months now. I want to get my rental portfolio started ASAP. Where do you guys recommend I start?

Alan Asriants · Answer

HOUSE HACK! Use an FHA loan and get yourself a multi family. If your mortgage payment is the same or less than what you would be paying for rent after all units are rented, go for it! Of course, have a good agent to point out any red flags, account for expenses, see what repairs need to be done

Jaron Walling · Answer

Wholesaling is very saturated @Augustine Maldonado. There are better paths to get started in REI but most require sacrifice. What can you sacrifice at 20 yrs old to jump start the journey??

What are the driving forces in your market? What type of housing are you interested and why? What strategy could you follow, buy, and scale? It's not rocket science. It's relationships, basic numbers, market research, and some money.

Steven Foster Wilson · Answer

Hi Augustine, welcome to BiggerPockets! This is surely the best place to start networking and learning. I always recommend the book “Rich dad, Poor dad” by Robert T. Kiyosaki to anyone starting out. Start listening to the BiggerPockets podcast starting at the very beginning and start growing your network, look on Facebook/BiggerPockets for different events, find a mentor doing what you want to do, and get to know the local lenders/brokers. All the best to your real estate journey!

Doug Spence · Answer

@Augustine Maldonado I would start by:

1. Educating yourself! Books, podcasts, youtube videos, etc. Whatever your preferred method is - start learning.

2. Connect with others in person! Go to local meetups and meet other investors. The RE community is very welcoming and people love to share and help others out.

3. Join a mastermind group! This is the way to fast track your investing career - I've joined two masterminds and they have been hugely impactful on my growth.

Good luck and keep us updated on your journey!

Konstantin Ginzburg · Answer

@Augustine MaldonadoI might be able to help you on two fronts. I'm also in the oil field now and a real estate investor at the same time. From personal experience, I can tell you that oil field is extremely cyclical. There are boom and bust periods in the industry that happen on a 5-7 year cycle. We are currently in a boom period and it is very possible to make a lot of money in oil at the moment but those busts periods often come with a lot of layoffs and work being in very short supply. My advice would be to enjoy the boom period in the current oil field at the moment but keep reading, studying, and begin your initial investing right now so that you can setup a solid base. Use the money you will be making within the oil field and put it towards building a real estate portfolio with sold cash flow that you can use as supplemental income once the oil field turns and money is harder to come by again. When this happens, it could be the time you look into jumping into real estate full time either as a wholesaler, contractor, realtor, or any other option that personally interests you. Also from personal experience, if you plan on investing in the area you are working in, be cautious since oil field towns are also very boom and bust. So there might be great rent coming in during oil booms where rent is in high demand but those rents can quickly drop and leave you with vacant units when the oil turn happens. If you can, protect yourself from this by trying to invest in areas that are not driven solely by the oil industry and are more diversified. Since you will be away from the area for work, I would also begin networking with property managers now so that you can find one you feel comfortable working. They will be crucial for your team for those weeks and months you are on a rig and can not look after your properties personally.

Lieren Schuette · Answer

I wish I had been interested in real estate when I was 20!  Good for you.  David Greene preaches househacking regularly on the podcast, and it's the perfect strategy for younger investors.  A couple things to keep in mind if you do choose this strategy:

1. Don't expect your property to cash flow, especially if you live in an expensive market (although it's not impossible).

2. Look at househacking as a means to reduce your mortgage payment so you can save that money for future investments.

Good luck!

Teesh L. · Answer

wow, wish i was this proactive when I was 20, I'm very impressed! as a new real estate investor, I would personally suggest exploring turnkey properties. turnkey can do all of the management, tenanting, and take care of all landlord duties for you. it's a great segue in my opinion as you can learn through this experience and when you have more ability to sink time and capital into a property, then you can house hack and BRRRR. that's what i would do if i were new to REI and starting my portfolio. i think these are really good articles that can help you get started and answers your question if now is a good time to buy.

https://blog.sharesfr.com/inve...

https://blog.sharesfr.com/turn...

it's really difficult to answer that question as there is no right or wrong time to buy. when numbers make sense for YOU that's the right time to buy. i am about to close on my 3rd investment property in the last 1.5 years in Atlanta and while i'm a landlord i don't have any of the landlord duties because i work with a turnkey company. i wont lie i was nervous about the interest rate hikes and mortgage qualifications but speaking on a very high level, it's about finding the properties that fit your criteria and that you can afford. i like to think about my properties in hindsight - if it's a good deal today then 90% of the time it'll become a great deal down the road. real estate is a long game, not for short term flips (with inventory shrinking it's getting very hard to find distressed properties you can renovate for cheap and still profit. you have to know the market, you have to know rental demand, you need quality tenants, you need to know how to refinance, etc.) if you want to chat further feel free to DM me! good luck :)

Scott E. · Answer

A house hack is pretty widely accepted as the best way to get started.

This means you buy a 2-4 unit, live in 1 of the units, and rent out the rest of the units. OR you buy a single family house, live in 1 bedroom, and rent out the rest of the bedrooms.

House hacking teaches you about picking a sub-market, negotiating a deal, getting financing, working with realtors. And it allows you to "get in the game" with pretty little money out of pocket.

Account Closed · Answer

Welcome to Bigger Pockets, Augustine!

I am not sure of what your knowledge of the real estate industry is, but you should spend some time expanding your knowledge. There are many factors that go into owning and operating a rental property, and it's very important to not cut corners when searching for your first deal.

Networking is a great way to expand your knowledge, while also making good contacts that could help you along the way (lendors, contractors, brokers, agents, etc.). Just talking to others with experience will help you pick up a lot of knowledge along the way.

20 Yrs Old where do I start?

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