How do I find a real estate partner when I only make $15 an hour?

Pheonix, AZ · Member since 2021 · 11 posts · 12 votes

Hi, I am 16 years old and I want to get a rental property, but I don't have enough money yet, and I will soon have a job that only makes me $15 an hour, so I have considered getting a partner, but where do I find a partner that could potentially finance a real estate deal?

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Tim DeFor

Rental Property Investor · Norfolk, NE · Member since 2020 · 38 posts · 40 votes

@Jose Lopez you can do this. When I ask what would I look for in a young inexperienced investor, here is what I see. Someone I admire at the stage they are in. Share that you are looking forward to your first deal. Go to meet ups. Listen and learn. Work on creating a clear vision. Be a go to guy for others. Bird dog deals for investors. Help with rehabs. Be consistent. Save up some money. Get to know meet up organizers. Show up early to help set up. Clean up after. Run technology. Mow rental yards when vacant. There are lots of things you can do that are little and they add up. Be faithful in the little things and the bigger things will come.

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Jabbar Adesada
Rental Property Investor · Beaufort, SC · Member since 2020 · 119 posts · 98 votes
4y
@Jose Lopez
Hello Jose, as young people, it is very easy to look at all the things we lack, money, maybe experience, etc. One GREAT advantage we have is time, energy, and our youth! Here is what I would do I would get extremely familiar with real estate, listen to every episode of the rookie podcast and the Biggerpockets real estate podcast, and the money podcast! You will figure out a good direction while attempting to finish them. Read most of the books that they recommend! Biggerpockets has an excellent selection of how to books to help you get started.
Focus on being around real estate investors as much as possible. I would prioritize your relationships more than anything else!
When you talk to people have a clear vision in mind it’s okay if it changes as you get exposed to more and more info, people will gravitate towards that vision and want to help you get there!
After doing all of or some of these things you yourself will figure out which route to take , how to make yourself valuable to a partner etc.
DO YOUR BEST TO TAKE ACTION ASAP I know two 16 year olds who have done 6-8 flips each. It can be done you’ll just have to creativity figure that part out
Also if I could suggest anything go for jobs that will give you skills not just what pays the most. If I could do it over again I’d go for my associates while in high school and do some type of sales or commission based job because sales are such valuable skills!!
I bought my first property in February when I was 19 6 month after I started down this path, and it would have been sooner if I knew at 16 lol. You have no idea how much of an unfair advantage you have, let everybody know you are 16 serious about real estate investing, that is impressive in itself.
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Jabbar Adesada
Rental Property Investor · Beaufort, SC · Member since 2020 · 119 posts · 98 votes
4y
@Jabbar Adesada
https://www.biggerpockets.com/topics/1004949
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Jabbar Adesada
Rental Property Investor · Beaufort, SC · Member since 2020 · 119 posts · 98 votes
4y
@Jabbar Adesada
Also get a credit card like ASAP, someone in your family with good credit will have to help you with that if you don’t have one already, but you need a secured credit card. Look up on YouTube Graham Stephan Credit Cards 101.
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Patrick HancockPro Member
Real Estate Broker · Orlando, FL · Member since 2018 · 101 posts · 108 votes
4y
@Jose Lopez
Hi Jose and great question.
My humble suggestion is to:
1. Learn, learn and learn more so you become the “expert”
2. Build as many relationships as possible
3. Become proficient in finding and putting together deals
4. If you can accomplish the first three the money (partner) will find you
Good luck!
Pat
[email protected]407-808-0899
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Craig Janet
Member since 2019 · 223 posts · 261 votes
4y
1. Get a job in construction. It's good money and you will learn how to fix things and how a home works. Even if you plan to hire out these task its important to know the basics.
2. Save for a down payment on a primary fixer upper. You're probably going to need a co-signer.
3. Rent the rooms to some of your buddies and have them pay the mortgage.
4. Save up for another property.
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Todor Ialamov
Real Estate Agent · Burlington MA · Member since 2018 · 114 posts · 142 votes
4y
That's the spirit Jose. Having a job and already planning to buy a property at age of 16 is nothing but admirable.
I think the best way to bring value to a potential partner is through finding deals. There are plenty of options:
- Driving for dollars
- For sale by owners on Craigslist or Facebook Market Place
- Cold calling
- Door knocking
- Direct mail
Do a google search on any of the above and you will find plenty of additional information.
Find a great deal and there will be plenty of investors who would love to partner up. Do it a couple of times, and they will start reaching out to check if you have anything coming up.
I wish you all best young man, you can do this!!!
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Chris Pasternak
Real Estate Broker · Pueblo, CO · Member since 2013 · 368 posts · 303 votes
4y
There is some really scary advice being given to a minor child on this forum.
Invest in yourself at age 16. First, graduate high school. Continue to invest in yourself. The return on your investment in yourself will be worth significantly more than the measly return on an investment property, always.
Joe Splitrock gave you the best advice. Just keep the principle I gave you in mind.
1 Reply
Ian WalshBusiness Member
Lender · Philadelphia, PA · Member since 2016 · 2k+ posts · 1k+ votes
4y
Find deals to wholesale or bird dog. Deals don't discriminate age, sex, race, money etc. A good deal is a good way to get in.
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Steve Vaughan
Rental Property Investor · East Wenatchee, WA · Member since 2014 · 10k+ posts · 16k+ votes
4y
Originally posted by @Jose Lopez:
Hi, I am 16 years old and will soon have a job that only makes me $15 an hour
Whoa. When I was 16 I worked my butt off, added a ton of value and was grateful for $3.50/hr. What value are you offering an employer that is greater than $15/hr?
That's the mindset we need. Not just in RE, but in general. Be grateful and give more than you get. That's how you will eventually get a partner or whatever.
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Scott Mac
Austin, TX · Member since 2019 · 5k+ posts · 5k+ votes
4y
Originally posted by @Jose Lopez:
Hi, I am 16 years old and I want to get a rental property, but I don't have enough money yet, and I will soon have a job that only makes me $15 an hour, so I have considered getting a partner, but where do I find a partner that could potentially finance a real estate deal?

Today your "Start up fund" = ZERO. Not a good place.
Save 75% of your take home pay in a bank account for three years.
I see you are 16, if you are out of school, get a second job and save 100% of that money.
During that time learn this business.
That could put $20 grand or so into your "startup fund"....
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Melissa Mascorro
Member since 2021 · 1 post · 0 votes
4y
@Jose Lopez
Find out the whole sellers in your market and reach out to them. As long as you make a commitment to generate leads and you're showing some success they'll be willing to partner up with you on deals. The other option is find an investor and don't pay a fee just commit to bringing them properties once you do a couple of bird dog deals with them they only pay you about $1,000 per bill, then you can work on wholesaling your first deal. The investor will eventually want you to succeed because of the amount of money you've made him for her they be more willing to partner up with you on the deal.
The other option is to become a professional yourself set yourself apart as a leader and an expert in the industry and soon Realtors will reach out to you and ask the partner up on a deal with you. That's my story by the way.
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Tanner Sherman
Real Estate Broker · Omaha, NE · Member since 2020 · 329 posts · 203 votes
4y
There are 3 things that you need to make a real estate deal happen; Money, Time(labor), and Knowledge. You do not need to have all three things on your own. The goal is to find a partner that can make up the difference. If you have the time to put in the legwork but no money and no knowledge or experience, then you just need to find someone that has money and experience but no time. If you have half the money, half the time and half the knowledge, you just need to find someone that can fill the other 50% in all 3 areas, or put together a team that can fill them.
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Matthew Irish-JonesBusiness Member
Real Estate Agent · Buffalo, NY · Member since 2017 · 2k+ posts · 2k+ votes
4y
@Jose Lopez get a job in the industry and get paid to learn. Instead of looking for a partner look for an employer.
Irish Jones Realty4.948 Reviews
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Michael K.
Investor · Chicago, IL · Member since 2018 · 352 posts · 176 votes
4y
@Jose Lopez hey man, gotta say, I love your spirit. That said, the unfortunate reality is that without any experience or money you are not going to find a real “partner” at this time. The word partner implies that there is some level of equality in the relationship. What you are looking for is a mentor, teacher or employer. Start by saving up some money and learning the business for a couple years. Get a credit card and start building your credit. Go learn something (not necessarily in college). Do all that and you’ll be in a great position by the time you’re 20. Best of luck!!!
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Mikielle Elum
Rental Property Investor · Pottstown, PA · Member since 2021 · 36 posts · 19 votes
4y
@Jose Lopez
Learn a trade (HVAC, GC, carpentry, roofing)… build your credit…save…network and get your real estate license once you turn 18. You want to bring as much as you can to the table that way you won’t NEED a partner. And if you do, YOU will be a solid partner as well.
Best of luck!
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Kayla Givens
Lender · Denver, CO · Member since 2021 · 244 posts · 253 votes
4y
@Jose Lopez - love that you are in the investor mindset at such a young age! I wish I had found and understood real estate investing when I was younger. I recently connected with another young investor named Jabbar that is crushing it - he took the time to learn and learn and learn some more and eventually found some investors to partner with. You should check him out and connect with him on Instagram - @Jabbar_investar !
Keep reading, keep learning, and get connected with investors in your area. You will find a partner or figure out how to get into a deal!!
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Quewane Chisholm
Queens, NY · Member since 2020 · 1 post · 0 votes
4y
@Tim DeFor
Thank you; sound advice to a valid quest most are afraid to come out with.
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Nick R.
Bothell, WA · Member since 2018 · 12 posts · 3 votes
4y
Jose,
What is the job that you have taken?
Is it in real estate at all?
Have you read Rich Dad Poor Dad?
In his book, Kiyosaki describes his purpose for employment at a young age as a means to get experience, not so much the means to a paycheck. If you want to get into real estate investing, I would recommend that you take work with real estate related business; property manager, title company, real estate company, or construction. Whatever you do, go in with the mindset that you will own the business one day and learn everything you can about it, then move on to the next. Regardless of if you are doing manual labor or clerical work still try to learn about other business aspects; purchasing, billing, taxes, customer service, bids, sales, etc. Work your way up... Do not let yourself get comfortable in any given gig.
There is one specific thing that you could theoretically be able to offer to a partnership, but I don't want you get burned. So research this, and your investment, thoroughly and be very careful with your partnership.
As a first time homebuyer, you could qualify for the first time homebuyer program with FHA. That is a value that you bring to the table only once. First time homebuyer FHA financing considerably reduces the downpayment - even if a partner paid all of it. The catch is that you, personally, need to be on title and the note.
Here is an example: For easy math, imagine my airbnb in your local Scottsdale market was purchased for $1 Million. As an investor, my financing terms required a downpayment of 20%. That's $200,000 plus closing costs. If one of my partner's could use a first time FHA loan however, we could have put down as low as 3.5% or just $35,000. That "saved" the partnership $165,000 in liquidity. The bank will require PMI in the monthly payment but that could be acceptable depending on the deal, purpose, and exit strategy.
Catch #1: How much equity is a first-time homebuyer credit worth to an investor partner? This is a negotiation and you won't be able to help much on the monthly payments either.
Catch #2: You probably won't get to do this again - specifically when you are ready to buy your own home, you will need that 20% down payment.
Catch #3: Even these First Time FHA loans require a credit score. If you do not have credit yet, you will need to get a credit card and start developing your credit. NEVER pay interest. Simply make a few routine purchases every month, purchases that you will make anyway and pay the balance off in full every month.
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Kevin C.
Real Estate Broker · Anchorage, AK · Member since 2012 · 89 posts · 77 votes
4y
Having money is not the deciding factor. Providing value to the partnership is.
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Brandon Penn
Rental Property Investor · Erie, PA · Member since 2018 · 84 posts · 462 votes
4y
I would suggest working that job and work on your credit over the next couple of years. Save up as much money as possible and then purchase a multi family with a residential loan. Live in one unit and rent out the others. It will get your feet wet with managing tenants to see if this is something you really enjoy doing and you can get in with low money down and a 30 year amortization which makes that cashflow better. This will also give you the experience that you can offer to potential partners.
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Ty AshBusiness Member
Real Estate Agent · Milwaukee, WI · Member since 2018 · 201 posts · 132 votes
4y
@Jose Lopez
There are many consistent themes in the advice that the other members have been sharing, and I agree with them. A big theme that hasn't necessarily been stated but has been eluded to is deciding who to surround yourself with.
-BiggerPockets, a community for you learn from and engage with that share your real estate goals.
-Reading, a conversation between you and experts in leadership, mindset, and real estate.
-Choice of Vocation, a chance to work with the best who can mentor you on your journey to the next level.
The people you choose to surround yourself with and the choices you make around wealth building will determine your success. You're well on your way and have the support of this community. Best of luck!
[email protected]
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Eric Morel
Member since 2021 · 98 posts · 53 votes
4y
Ever thought about wholesaling? I am not interested in it myself, but I have heard this is how a lot of investors have gotten started in the industry. It is a transactional not a building wealth strategy, but can teach you a lot on how the buying happens in real estate. You can earn $2k or in the 5 digits per deal. It is a grind, so be prepared to commit time to it. It may help you build yup your nest egg to invest though. It may also help you build a network and fill in the gaps on knowledge. I have enough money, time, but lack knowledge. I am taking all the free courses I can. I found one for $18.00 ant is is pretty good.. I would not pay thousands of dollars unless you are good with doing that for training/mentorship. Those are out there, but would command 7-10 k.
Above all protect that mindset. Breaking in can be tough!!! you have to remain determined to find your 1st deal and roll from there. I am still looking for my 1st deal. This is a credit industry. You need 700 plus to be in a good position. I have learned that. I am taking 4-6 mos to get my credit as high as possible and to increase my cash reserves where it offers me more flexibility of what I buy.
Good Luck!! Wished I had your mindset at 16. I was working at McDonalds and was preparing for a better job. Building wealth was not in my head at all.
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