I was hating my job, the long commute, the stifling manager, the boring day-to-day routine…and everything. I told my husband I want to do something just for myself, for us, for our future. In late November, I told him “Let’s do real estate and buy something! The market has gone up for 5 straight year and we need to find another place to put our money in.” Surprisingly, he said yes. And then our real estate adventure unfolded.
I quit my job in January and signed up on redfin and Loopnet while Joe still kept his job. We started looking for deals, first the single family houses and then multifamily. 3 months later, we now own 2 properties in two different states for a total of 45 units. The only experience we had was our primary personal residence we bought 3 years ago.
During these past 3 months, we did our due diligence and studied up all the terminologies to sound smart and professional when we phoned realtors. We emailed and called the real estate agents on redfin and loopnet. Out of our surprise, not everyone got back to us or even cared to follow up. We had good a credit score and had the down-payment ready to buy any decent property (outside California). We finally got in touch with our Houston realtor. He replied back with bunch of information and judging from his experiences in commercial apartments, we decided to use him in Houston and signed the agreement to only work with him. After talking and working with different real estate professionals, we learned that although analysis paralysis is not good, jumping into real estate with 2 feet before you know enough about the basics is also dangerous. We found a couple real estate agents that did not have our best interest in mind and by knowing enough before-hand, we were able to protect ourselves and have confidence in our approach and plan.
After we had the first property under contract, Joe started his search for our next property. And soon enough we found it and not a second of hesitation, we put an offer on it. We low-balled it and got a counter offer but luckily we countered back and got a pretty good price at the end. Having 2 properties under contract was a bit overwhelming to start with. But with a lot of research on BiggerPocket and YouTube, there was nothing we couldn’t conquer.
On 4/6/15, we now own both the apartment complexes. We had just went from 0 to 45 units in 3 short months. A couple things that we learned and that helped us.
For one, we wrote up a good personal & property statement that helped to procure our loans. This was pivotal in us securing the loans with no experience and being an out of state investor. This statement not only talked about us and our “experience”, but also detailed the property and what we planned to do with it, the financial numbers, and a little about the overall trend of the area in general. This made loan companies almost excited to finance us.
Secondly, one lessons learned is that you should always look for others’ opinions before doing something totally new to you. We didn’t initially do the due diligence to get an insurance quote. At first we couldn’t even get close to seller insurance quotes on either property and this is with going to about 3 different insurance brokers on each property. It wasn’t until we searched in desperation on BiggerPockets and found some references. This 5 minute search on the forums ended up saving us about $10,000 overall. We learned that BP is a key resource that we wished we had found sooner.
Thanks for all your support and we look forward to keeping you updated on the status of the apartments, sharing our experience (and lessons learned), and with getting to know each one of you on BiggerPockets. One is middle income, move in ready, and in a smaller town and one is lower income, with lots of deferred maintenance, and in a large city.
