How to Get Started in Investing

What we are going to talk about today is we always get investors asking us how to get started in investing. And no one really knows what that first step is. I can tell you my recommendation would be is the first thing you want to do is you want to create a plan. You want to make sure that you have a plan, you have it written down and documented from beginning to end or the best you can. It’s not to say that you may not change it as time goes on, but you want to make sure that whatever that plan, is you’re going to stick with it. That’s the most important thing, write it down, and stick to that plan.

The next thing you want to do is, in that plan you want to make sure that you are going to be complying with all the government local agency laws. These laws include Texas Real Estate Commission, IRC have IRS laws, you have Fair Housing Laws, you have Discrimination Laws, and Fair Credit Reporting Act Laws. There’s just a lot of things you want to make sure that you know what you can and cannot say, can and cannot do. My recommendation is you want to surround yourself with a very good team, meaning you want to get Real Estate Agents that know what they are doing that can help you find the deals. You want to make sure that you’ve established relationships with contractors, you want to make sure that you’ve established relationship with inspectors, you want to make sure that you not only have a short term but you want a long term relationship with them to make sure that they realized that you are serious and that you are going to do what you say. Last thing a contractor wants is somebody picking their brain all the time and never does business with them. So you want to establish all the roles that you are going need filled and then during that time you want to establish relationships with them. Maybe say I will try to find three Real Estate Agents and then maybe you may find one that you really like and you should do a lot of business with, same thing with contractors. Just get a good team on your side. Best thing you could do is leverage other people. You only have so many hours in a day and if you have a team of five people obviously you can do a lot more with that.

I think as an investor your best bet is focusing on finding deals and making that decision financially whether or not it’s a good deal or a bad deal. Have the inspector go out and tell you if you need a new roof, or have a contractor who will tell you how much the make ready bid will cost. And that you can plug into your numbers as a true investor and that would tell you whether or not it is or it’s not a good deal. Have the agent find rental comps for you and that’s how you will know if it’s going to make money for you or not. And that’s all about leverage. The best thing you could do is get the team, create a business plan, and sit down to talk to people. We have a lot of investors that would come and talk to us and just ask us questions even if we don’t manage their properties we still help them by answering questions here and there. What kind of people do you want on your team, what constitutes a good team member. Those kinds of things.