Getting started as an investor

[Sebastian Torres]

I am looking to start my future as a real estate investor, specifically as a wholesaler to begin with then eventually moving on to renting out mutli-family properties. But I need help getting started. Can I get some recommendations on what my next step should be. (besides reading more books)

[Abel Curiel]

Hello @Sebastian Torres,

Welcome to the BP forums!

Why do you want to wholesale? Is your long-term goal to buy & hold rental property?

Wholesaling, at a successful level, is a FULL-TIME business. Now, if your long-term intentions are to have a real estate marketing company where you find, negotiate and offload off-market inventory, wholesaling may be a good route.

If you are like many BP members, you're looking to get started in RE investing with the objective of getting into multi-family property investing. If this is the case for you, which it sounds to be, I'd highly recommend using the house-hacking strategy as a new investor. 

Here are the reasons why folks use the house-hack strategy when building/growing their portfolio:

- House hackers can get in with a low down payment - You can get into a multifamily property with as little as 3-3.5% down!

- They can significantly lower their current living expenses - People currently paying rent can pay as little as half of that for their portion of the mortgage (after collecting rental income). In some markets (i.e. Midwest) house hackers can even cashflow while living in their property. ** We have had this result in Brooklyn, New York as well but cash-flowing on a house hack deal is extremely rare in high-priced markets.

- They gain acquisition, project management AND property management experience - all which will help tremendously when its time to scale and grow the portfolio.

-When house hackers move out (to the next house hack OR forever home), the income of their currently occupied unit will usually allow them to cash flow.

Not saying that wholesaling is not a potentially successful way to get started in RE... I'm just making the argument that the funds, time and energy that would go into a marketing campaign to target seller leads can also go into an actual asset with a SFR or MFR house-hack deal. The seller lead conversion timeline can be 1-24 months depending on conversion skills, market knowledge, network of investors/buyers, ability to close, etc.

Best of luck to you moving forward! 

Abel