Where in the world, or country, to start investing..

Question

Hey! My name is Christina, and real estate investing is something I've been interested in since high school. Well, 6 years later after schooling and traveling abroad quite a bit I am back in the states, I am eager to learn and ready to start down that path. So far I'm in the beginning of the continual process of reading and learning about the ins and outs of REI, and saving up for that first down payment. My partner and I are from small town Massachusetts, and currently reside near Vail for a "ski season." The hardest decision that we have to make with REI, is where in the states, or world, we want to live and invest... I've traveled the world, and am now ready to start the next chapter. Any and all advice is welcome!

Bret Burton · Answer

@Christina Labowicz,

First off, well done and keep reading books. The big thing is to understand the concepts now and to be ready to move when the time is right. I highly recommend wholesaling, even in this area. I've been looking for someone for a while and I haven't been able to find anyone around here. I'm certain there are plenty of owners and certainly a lot of buyers. Not to mention, using those wholesaling strategies will help you find a good deal. Read 3 books on wholesaling and you'll have a strong grasp on it.

I work with a private lender/partner and we're always looking for deals, but moreso a wholesaler.

The prices shouldn't scare you to buy a place here. If the numbers make sense, it shouldnt matter what the total value of the place is. If you know that in the worst case scenario, where you have to move and rent your place out, you'll cover all of your costs, then you should do it. Living for free, paying down principal and getting big tax benefits should be enough motivation. Evaluate this home as if it were an investment and rented out. If it makes a lot of sense, use it as your primary residence for now. Just dont go buying a house just for the sake of buying a house - even your primary residence should make financial investment sense.

This private lender I work with is quite flexible on terms. If I were you, I would find something up valley, 3 bedroom sub $350. Its highly unlikely you'll find this on the MLS, but contacting owners directly can get you there. If you have any cash for a down payment, you use this private lender (at 8%) knowing you'll be refinancing in a year. Showing you've had this mortgage and paid it on time, in addition to building credit with other credit lines, you'll be able to refinance with a VA loan at a very low rate. VA loans allow you to have a high loan to value ratio. You would be able to buy out the private money loan with the refinance and get virtually all of your down payment back. Keep in mind your employment history might still come into play (I'm not certain about VA but Fannie Mae requires 2 years of employment history, so look into that first).

You can also look into owner financing. I have two properties owner financed that I otherwise never would have been able to buy at the time. one is 6% and the other is an interest only at 5% for 3 years. We're in the process of refinancing now to a conventional loan.

Since I moved here I've worked in the service industry as a bartender or server. One of the best things about living here ARE the offseasons. Restaurants are very slow in the offseasons and the ones ive worked at close for 6 weeks at a time. This allows us to either travel or work on real estate if we're feeling motivated. We use that down time to learn, look and think about deals. Also, keep in mind there is a huge percentage of out-ofstate owners, anyway. The offseason is as good of any reason to contact those owners. They might be between tenants or wondering why theyre spending so much money on an empty house they aren't going to.

Argentina, Greece or Croatia will be my next big trip, but I love SE Asia (although we only went to the philippines). Vietnam is high on the list tho, and that might be our first 3 month hiatus country since it is so cheap. I'll definitely consult you before we go!

Blake Brose · Answer

@Christina Labowicz If you are looking for areas to invest in nightly rentals, you may not need to live in that location. If you have a branded and managed nightly rental home that could keep 40-60% occupancy. Would it matter where the property is? Here is a link with more info: http://bit.ly/2gQ6TAM.

Christina Labowicz · Answer

Well, thanks again for all the great responses. @James Carlson we are having such luck with the airbnb so far, especially up here in the mountains during the winter months. I am always open to suggestions, and even get a lot of tenants going to the Denver area for a stay so if you have any properties I can suggest I'd be more than happy to do so.

@Julie Bradley I understand where you are coming from although don't have much experience. It sounds like in my situation being that there are continuous stream of buildings and jobs, especially with the expansion of the hospital it sounds like a great place to start buying. Things like that, good school system, new businesses coming in etc. are all good indications. I wish I could talk further on the subject.

@Bret Burton I always appreciate your thorough responses, I have sent you a private "note," if you didn't end up seeing it let me know!

Julie Bradley · Answer

Hey Christina,

I myself am new to REI and biggerpockets as well and feel that I too still struggle with answers to your question. Despite learning some very helpful information.

"Where in the world, or country, to start investing.."

I want to share what my reading and studying has revealed. What I haven't heard being said here yet but would like to start the conversation. The direction was to perform research on local markets and gather it on 2 levels. Level 1 research was described as gathering market indicators through current events. Of which one major market indicator being employment. This should help to pin point a general location. Level 2 research was described as doing a number of research efforts at the local level and reaching out to a local property manager was suggested in helping gather necessary information.  So as I write this process again for the second time I am realizing that my struggle would be identifying good sources for market indicators and assessing the indicators to the point that they would influence my decision. I hope this will assist you in your pursuit and also initiate some helpful conversation around this topic.

James Carlson · Answer

Hey @Christina Labowicz . Welcome to BP!

I saw you mentioned that you may be Airbnb-ing your place? Sounds like you currently rent but may have permission from the owner to do short-term rentals. That's awesome. Good for you. I love Airbnb and think the returns can be amazing, even if you're just a renter subleasing out a portion of your place. It's definitely one of my favorite topics, so if you ever want to talk more about it, let me know.

Good luck!

Christina Labowicz · Answer

Hi guys, @Bret Burton, I must say, it is such an inspiration having someone from the area reaching out. Somehow it makes my vision for the future feel all the more real. We have been in the area for a few months now and have been contemplating staying here full time. We're currently in Eagle, and have a great opportunity of profit sharing with the owner of the house in regards to airbnb, a great way to help us save.

I appreciate your recommendation on the 3 bedroom. I can totally see how that would work and am excited at the prospect. From everything I've been reading, currently reading Millionaire Real Estate Investor, which has been a saving grace in clarifying a few things for me, and it sounds like wholesaling is a good place to start, to learn the basics of buying and selling etc., but it still seems very foreign and intimidating as the prices in this area seem unrealistic for my partner and I who are just starting out.. I could be totally wrong.

My partner is a disabled veteran, so it sounds like we qualify for a VA loan if we will be residing in the home. But, given our shallow track record with employment (haven't worked since November last year as we've been backpacking) it seems impossible to get any financing. Do you have any creative ways or suggestions to finance a first investment? Also, how are you finding your properties do during the off season months? It sounds like you and your wife have created a great situation for yourselves.. the ultimate goal. And, if you'd ever like some advice on SE Asia I think I can lend a hand!

@Bonnie McCullough thank you for the advice! I am actually from Westminster, MA, so know the area well. My partner's mother is a wonderful Kheller Williams realtor, if you're ever in need of one I can pass her contact information!

Thanks again for all the helpful information.

Bonnie McCullough · Answer

I agree with Bret. keeping your investments close is the best way to go, especially at first. With the right 2-4plex you can often live for free or close to it. That also makes sure you choose a desirable area for good people like yourself. If you wouldn't want to live there chances are neither would any desirable tenants. But be careful not to over improve either, if you have expensive taste try to keep in in check, a slightly used $400 refrigerator keeps food just as cold as a $1,500 one. The expensive one might look really nice and have some great features but it isn't a good investment, don't let the market sell you the bells and whistles.

Bret Burton · Answer

Hi Christina, welcome to BP. I currently live in Avon, CO. I've been investing in this area for 4 years and I have 7 properties between Avon and Eagle-Vail. You've got some interesting questions...

I have similar interests and traveling is very important to my wife and I. I'm 32 years old and we're currently looking at spending 3 months abroad a year while spending the rest of our time in the Vail Area. We'll only be able to do this because of our real estate investments. So keep in mind that you don't have to stop traveling to be a real estate investor and you can increase and escalate your time abroad by having good investments.

This particular area is really interesting because you can live here most of the year and if you want to travel during the winter or summer months, you can rent your property month to month and use your excess income to cover your living expenses abroad (especially southeast Asia). Read 4 hour work week. some of it is nonsense, but a lot of the principles will be great for you. Just keep thinking real estate.

As you know there is a housing crunch in the area that won't be solved for years to come. Long term rentals (if you get into the right one) will be predictably strong earners. The short term market is useful if you would like to travel easily but you probably wont have as good of cash flow.

I highly recommending buying a 3 bedroom and renting out the other two rooms (or a duplex-fourplex if you arent living in Eagle County). Its house hacking and if you buy the right place, you and your partner can live for free. They exist in Eagle County, you just have to be ready. its the best way to save capital for your next project.

How long have you been here? Have you considered living in this area full time?

Christina Labowicz · Answer

Hey guys! Thanks for reaching out. @Marlon Fong I will most definitely take advantage of asking questions on the forum, @Glenn D. thank you for the motivation! (And yes, I have found plenty of neigh slayers, of which I'm learning to block out) and @Joshua Poitras I am very new to the site, so I have not yet branched out to ask for that advice yet. @Shawn Ackerman thank you!

The two biggest questions I have at the moment are how to determine which types of properties to invest in that will align with your life goals, and how, when you haven't been in a steady location for years, to choose a location to start investing in.

Any thoughts on the subject would be much appreciated!

Shawn Ackerman · Answer

@Christina Labowicz Welcome to BP!  Best of luck

Where in the world, or country, to start investing..

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