Tips for a Noob in Metro Detroit

[Matthew John]

Hey everyone!

I've been absorbing information, just reading & listening to everything I can find. I'm at the point where I want to diversify my portfolio into real estate. 

Little background - I'm 25, living in Metro Detroit. I currently trade/invest in different financial markets (stocks and cryptocurrency) & also have a business helping people become successful traders/investors. After trading full time for 6 years, I finally had my breakout multi 6 figure year in 2016/2017. I'm at the point in my life where I want to diversify my investments into real estate. 

I'm a total noob in the real estate markets. I've been researching Turnkey Investments, but they seem to good to be true. For a company to buy a property, renovate it, find a tenant, and manage it...why would they want to sell it? Are they jacking the price up a lot? What's the catch? For it to make sense to me, there would have to be a huge markup for them to profit. 

I have been considering getting my real estate license this summer just to get more knowledge of the space. Being young(er) than most people in the field, I don't want to be taken advantage of so figure this would be best to expand my knowledge. 

Are there any cons or reasons to NOT get my real estate license? 

I guess what I'm looking for is some advice to someone that hasn't invested in any properties, doesn't own any properties, and is just looking to dip their toes in the industry.

It would be nice to connect with some local investors in the Metro Detroit area. 

The city of Detroit is some of the cheapest property around. Houses down there are selling for 30k - 80k and these turnkey businesses are saying how great of an opportunity it is to invest. Some parts of the city are trash, but some parts also could appreciate nicely in the next few years. Hard to differentiate which ones those will be. 

Anyway, thanks for taking the time to read this & appreciate any tips you guys can spare! 

[Christopher M.]

@Matthew John

Welcome to BP and the world of RE investing. 

Tip#1 NEVER admit how much you are willing to invest, unless you are speaking to an agent or a lawyer with whom you have client relationship. It brings out the vultures.

Tip#2 Turnkeys: You kind of answered your own question. Most don't jack the price up above a rational price. They do raise it to a "retail". As an investor you should never be paying retail for a property. 

Tip#3 RE license: It will set you back about 1-2k to get set up. Including the course, the test, and joining an MLS. The MLS is over rated. Unless you want to help others buy/sell RE, I don't see a reason to get it.

Tip#4 Drive around areas you think you might be interested in investing in. In your neck of the woods, Warren; Eastpointe; Pontiac; Detroit all might be some good areas to start with. 

Feel free to reach out to me at any time if you have any questions