Young aspiring real estate investor seeking advise

[Lenny Montesano]

Hello to all,

I am a 22 year old Husband/Father/student athlete at East Tennesee State University. As a senior baseball player looking to eventually play pro ball after this spring semester, I acquired a serious interest in doing real estate as another source of income. I desire to begin investing asap so I started the process of learning as much as I can by reading and watching videos. Currently I am reading "Buy, Rehab, Rent, Refinance, Repeat" by David Greene and tuning in to a lot of Brandon Turner video and content. Any recommendation for the first steps I should take if I want to purchase my first rental property using the BRRRR method (or flipping). Also, does anyone think it would be in my best interest to wait to graduate in may? Although, I would definitley prefer placing my first property under my belt before then if it's possible

Thank you !

[V.G Jason]

Get on the ground floor and start leaning. Learn to find properties, underwrite them, connect with lenders to see what your financial situation fits. Then when it aligns, start doing it.

Books and videos are as good as the time they were produced, you're going to want to get a pulse on the actual beat of the floor. 

[Benjamin Aaker]

Hi Lenny,

Probably I would wait until you have a steady income source to make it easier to get a mortgage. Also, you should focus on getting your degree before purchasing. Use this time to study at the university and continue to study real estate. Keep evaluating deals so you are ready when a good one comes along.

[Lenny Montesano]

@V.G Jason love it thank you sir. 

[Lenny Montesano]

@Benjamin Aaker makes lots of sense thank you very much! 

[Justin Landesman]

I love the HUSTLE you have @Lenny Montesano . Use next 4-6 months to learn by listening, reading and watching how the real estate investment game works. You need to identify which strategy you like best before jumping in and get extremely familiar with the process of underwriting deals. Find a mentor that you can run "good" deals by. Once you start to find something wrong with almost every deal but finally find one that really makes sense, run it by your mentor to see if they agree it is a good deal. By that time, hopefully you have saved up around 20%-30% for a down payment since you do not currently have any income and will be able to qualify for a DSCR or FIXNFLIP loan.

Hope to see you with your 1st property in 2025! Feel free to reach out with any questions. Go Yankees!

[Phillip Austin]

@Lenny Montesano I love the hustle! A 22yr old father, student and college athlete that wants a side hustle. Kudos!

My best advice would be to begin networking as much as possible and find a mentor.

You've already taken the first step which is gaining knowledge. Continue reading as much as possible and couple that with your ability to network and meet people in the industry. 

REI is an ever changing landscape and you're chances for success are greater when you learn from and hear from others who have the experience.

[Lenny Montesano]

@Justin Landesman this is tremendous advice thank you Justin! This is definitely the plan, go Yankees !!!

[Lenny Montesano]

@Phillip Austin thank you ! I agree exactly why I hopped on hear. Excited to learn and network. Definitely looking to find a mentor.

[Konstantin Ginzburg]

@Lenny Montesano

Congrats on your first step into real estate investing. You are honestly way ahead of the pack already simply by being willing to start learning about this topic in your early 20s. Congrats on that and best of luck on your pro baseball career. You are reading the right material already. The main advice I would recommend is to begin networking. There is likely going to be a real estate investor association meetup or club in your area, so it would be a great idea to begin attending their meetings and getting to know them. That would provide you with both knowledge to help you run numbers but also provide you with a funnel network that can bring deals to you once you are ready to move on an actual property to invest in. 

As far as waiting until you graduate: either option would work but I would imagine your biggest obstacle at the moment would be that you do not have a set record of wages from an employer. This would limit your options for the financing packages you might be able to get or which lenders would be willing to work with you since most lenders will want to see 2 years of pay to qualify you. There are other ways around this such as seller financing or private money lending but that is an obstacle you should be aware of. 

[Lenny Montesano]

@Konstantin Ginzburg thank you so much for tremoundous advise. I will definitely consider heading out to a meetup and networking with other folks. And thanks for giving me insight to how the lending process will work for me and the obstacles it can intail. I'm excited to learn more and get the process going!

[Devin James]

Quote from @Lenny Montesano:

Hello to all,

I am a 22 year old Husband/Father/student athlete at East Tennesee State University. As a senior baseball player looking to eventually play pro ball after this spring semester, I acquired a serious interest in doing real estate as another source of income. I desire to begin investing asap so I started the process of learning as much as I can by reading and watching videos. Currently I am reading "Buy, Rehab, Rent, Refinance, Repeat" by David Greene and tuning in to a lot of Brandon Turner video and content. Any recommendation for the first steps I should take if I want to purchase my first rental property using the BRRRR method (or flipping). Also, does anyone think it would be in my best interest to wait to graduate in may? Although, I would definitley prefer placing my first property under my belt before then if it's possible

Thank you !

Hey Lenny,

Love to see that you also got the Real Estate bug so young

I recommend a BRRRR/house-hack for your first one

Buy a place that you can live in with a low downpayment, fix it up, and then you will have the option to 

1) Refinance and live in it

2) Refinance and rent it out

3) Sell and do it over again

4) Dont refinance and continue to live in it

5) Dont refinance and rent it out

You will have a ton of flexibility and the safety of knowing you have a place to live

Please reach out via DM if you have any questions moving forward. Love to help fellow youngins getting after it.

[Peter W.]

Good luck, you are a busy man with school, family and baseball.

Likely your best bet is house hacking (if your partner and child are willing to share housing).  You're probably too late to do it for school (where your teammates could be roommates), but you'll be in a good position to do so with your teammates in minor league ball.  The idea here being you buy a 3-4 bedroom house near your practice facilities--and renting the extra rooms to your teammates.  You leave rent free while acquiring assets.  As you move to the next team/city you can repeat the process.  You have a natural advantage with other baseball players and providing them leases that fit their needs.

Knowing a couple of others who have played minor league ball, your real estate strategy is going to be tricky because you will be very busy with baseball and it's travel.  And they will likely move you to a new city frequently.  With a natural in and use owner occupied housing, you could likely end up with 1-2 houses a year (each in a new city).

The other option is when your baseball career is over, you will most likely end up back in your home town, so you could start the brrrr process there with maybe your parents checking in on the work the contractors and property managers are doing.

Best of luck.

[Lenny Montesano]

@Peter W. this is tremendous input that fit exactly to my needs thank you!

[Lenny Montesano]

@Devin James love it. Thanks for the advice !

[Bryan Maddex]

@Lenny Montesano congrats on starting your journey already!  The average 1st time homebuyer is 37 currently. Even if it takes you a year to pull down your first deal, you are killing it my friend!

Quick tips:
1st - you do not need income to get financing. Ignore those comments. There are tons of loans out there that use just the projected or actual income from a property vs the payment of the property (DSCR loans). Rates can be very similar to those of conventional financing (Fannie/Freddie - full doc loans that you will need to prove income to get), but typically a little higher than conventional financing.

2nd - Networking and partnerships! Learning from others can drastically shorten your learning curve. You do not need to go about this solo! You may need some help with capital, or credit, or both. You may have both but may be able to find someone else who has experience but needs a credit partner or capital partner. Meetup is a fantastic app to find real estate meetings around you, and look for local REIA (real estate investor associations) and attend a bunch of meetings. The bigger REIAs out there have many sub groups that may specialize in fix and flips, landlords, notes, or somewhere in between. The subgroups are usually smaller and easier to get to know people. Volunteer! Offer to intern, find a way to get involved.

3rd - If you find a deal, you can then find financing! Kick the tires of a couple of homes. Work thru what you would bid on the house, what you think repairs would be, what you think your ARV would be. Then, speak to a lender or two and ask them to help evaluate your deal! Hard money lenders are going to want you to have success and will often times help you see if your numbers are close or way off.

CREDIT - You need this!  If you don't have it, work on it.  If you do, work to protect it!  Ideally, you want a 700+ score. Goal is to have credit cards that you do not use more than 10% of. Credit cards make up 65% of your credit score!  If you don't have at least 2, work towards that.
Business Credit - once you have some established credit, you need to protect it!  So often i speak with flippers who put too much money on their personal cards and tank their scores. This limits your refi options when you take your scores down under 660.  Open a business credit card and do your renovations on that (for things that you cannot get financed with a hard money loan). Many business credit cards do not report to personal credit. 

Assets - you need these, or you need partners. You can do as little as 10% down on your purchase price with a little experience, and then get up to 100% of your rehab budget financed! If you have not flipped a home, do not have a rental property, and do not own a primary residence, you may have a hard time getting into lending. Most lenders want to see homeownership and experience with flipping and or holding properties.   You may need an asset partner to help you with a few flips so you have full access to financing. 

Good luck on your journey!

[Lenny Montesano]

@Bryan Maddex tremendous advise. Thank you sir for your elaborate reply means a lot! Definitely will apply your input.

[River Sava]

Hi Lenny - Welcome to BP!

Your first step should be building a strong team: an investor friendly agent, lender, contractor, and property manager are key. Understanding your financing options as a first time investor will also help you act quickly on a deal. Focus on one or two target markets, get familiar with the numbers, and use tools like BP calculators to analyze potential properties.

Whether you start now or after graduation depends on your bandwidth, just have the right systems and support in place first. Best of luck, and feel free to reach out with any questions!

[Jaycee Greene]

Quote from @Lenny Montesano:

Hello to all,

I am a 22 year old Husband/Father/student athlete at East Tennesee State University. As a senior baseball player looking to eventually play pro ball after this spring semester, I acquired a serious interest in doing real estate as another source of income. I desire to begin investing asap so I started the process of learning as much as I can by reading and watching videos. Currently I am reading "Buy, Rehab, Rent, Refinance, Repeat" by David Greene and tuning in to a lot of Brandon Turner video and content. Any recommendation for the first steps I should take if I want to purchase my first rental property using the BRRRR method (or flipping). Also, does anyone think it would be in my best interest to wait to graduate in may? Although, I would definitley prefer placing my first property under my belt before then if it's possible

Thank you !

Hey @Lenny Montesano! As a former college baseball player (albeit D3) and current coach for my 15U son, I commend you on your interest in real estate while still in school and playing ball.

What type of property are you looking to acquire first? A SF property to live in/house hack, a 2-4 MF rental, or 5+ commercial MF? And what is your price point and are you looking for turn-key properties or something along the lines of a "fixer upper"?

Other questions to consider is location (something near ETSU campus? in Jax?) and whether these would be short, medium, or long term rentals.

[Todd Anderson]

Lenny,

Good for you for thinking about your future and welcome to BP.  Going down the path of house hacking would be the advice that I would give anyone in your position.  Find a single family, or even better a duplex that you can live in and fix up.  In your situation you may be moving areas.  This is something you can do in multiple cities.  Do this every year if you can.  It won't be long you can look back and see a nice portfolio.  Then you can combine or exchange for a better or more consolidated/ better proforming area.  

I bounced around the minors in hockey and I wish I still owned all the places that I stayed.  

Best of luck on your road!

[Frank Pyle]

Quote from @Lenny Montesano:

Hello to all,

I am a 22 year old Husband/Father/student athlete at East Tennesee State University. As a senior baseball player looking to eventually play pro ball after this spring semester, I acquired a serious interest in doing real estate as another source of income. I desire to begin investing asap so I started the process of learning as much as I can by reading and watching videos. Currently I am reading "Buy, Rehab, Rent, Refinance, Repeat" by David Greene and tuning in to a lot of Brandon Turner video and content. Any recommendation for the first steps I should take if I want to purchase my first rental property using the BRRRR method (or flipping). Also, does anyone think it would be in my best interest to wait to graduate in may? Although, I would definitley prefer placing my first property under my belt before then if it's possible

Thank you !

Hey! Balancing everything you're doing is impressive. Here are some key steps to get started with the BRRRR method:

1. Keep Learning: Stick with reading and watching videos from experts like David Greene and Brandon Turner.
2. Get Your Finances in Order: Save up for a down payment, check your credit score, and look into getting pre-approved for a loan.
3. Research Markets: Find neighborhoods with growth potential and high rental demand. Look for undervalued properties.
4. Network: Connect with local real estate agents, contractors, and other investors for insights and deals.
5. Analyze Properties: Use the 1% rule to evaluate potential properties (monthly rent should be at least 1% of the total investment).
6. Secure Financing: Explore different financing options like conventional loans, hard money loans, or private lenders.
7. As for timing, if you can handle the extra responsibility, starting now could give you a head start. But if it feels too overwhelming, waiting until after graduation might be better.

    Good luck with both your baseball career and real estate journey! If you need more advice, just ask.

[Lenny Montesano]

@River Sava amazing thank you, looking forward to building my team!

[Lenny Montesano]

@Jaycee Greene definitely some questions I will ask my self thank you ! Love to hear you played ball and son does too that's awesome.

[Lenny Montesano]

@Todd Anderson thank you sir, something I will seriously consider!

[Lenny Montesano]

@Frank Pyle great keys ! I really appreciate this response 

[Matthew Hutchinson]

Hi Lenny,

Dang man - you got a lot going on.  Good for you!

Continue you reading the BRRRR book by David Greene - thats where I started. I would suggest that once you are done reading that book - give it about a week and read it again. This will help ingrain those ideas into your brain. Watch as many Brandon Turner and David Greene videos as you can on BRRRR. I would also suggest that you find a meetup in your area of real estate investors that actually does BRRRR deals and will take you on a walk thru of one of their deals. This will give you the opportunity to ask questions and get live feedback right there on the spot.

Once you have done the above - then you just have to do it. Try to find a BRRRR multifamily deal and live in one unit and house hack it then rent the other units out. Then as people move out do the exact same thing to those units.

You can get in with an FHA loan at 3.5% or a first time home buyer program. Then like the title say REPEAT!

Good Luck