All Forum Posts by: Josh Johnston

Hey @Josh Johnston, I'm just starting my journey in real estate and have also been looking for an opportunity to learn while I work. Currently I've applied and am set to interview for a job as a part time leasing agent at an apartment complex in my area. Ideally it will allow me to experience working with tenants and get some hands on experience while working weekends. There may be something similar worth checking out after you make your move.

Best of luck!

@Josh Johnston

Fannie Mae, the "standard" government sponsored loan that you get from your bank or lender. Between you and your wife, you can get a total of 20 before you need to get creative with hard money or private lending or portfolio loans. They have standards on habitability and you'll need an appraisal before you get the money. Basically, these are typical for people buying owner occupied, or turn key investment properties. 

You could buy one of these turn key or a home that's livable but needs work, to get started. Start slow. 

I know how you feel about the day job, but make it fun, include those numbers in your business to help you reach your ultimate goal faster 

Sounds like you really want to get out of the day job. 

Hard money is expensive, you and your wife can get 10 FM loans each for a total of 20. If you are flipping, you will use private money or your own for the most part. Buy and hold, you can get up to 10 FM loans each. Remember that you will need reserves and underwriting may get more strict in the 5-10 loan range. 

Partners are a great idea. You could provide the cash to an investor who will bring you along for the ride so you can participate and learn the business as well as share profits. Vet them out and get a lawyer involved for the legal stuff. You need to cover yourself because there are a lot of cons out there. 

Keep reading. you need more knowledge and then more experience before you leave your jobs. Not to say it isn't possible to make it, but especially with a family, I recommend you hold onto your jobs. Include the job income as part of your strategy to help ease that pain, mentally. 

Flipping is a job and it is taxed heavily. But it is an option if there is opportunity in your market. Maybe there's a lot, maybe there's enough for bonus money to compliment the rest of your strategy. Buy and hold is great, but if youre looking to create a business to get you out of the job today and not 20 or 30 years from now, you should find distressed buildings, motivated sellers, in stable or up and coming areas. Rehab strategy and experience compliments house flipping. And it all takes knowledge - finding areas and finding the right properties. You could also look into REIT's. Whether you go with a crowdsource type reit, traditional reit, or buy a vanguard reit index.

Explore it all, the more you do and the more knowledge you gain, the more focused you will become and can then get the experience you need 

@Josh Johnston I could not stop laughing about your emphasis on the feisty little ones. I have a 2-year girl and oh is she feisty?!

Though a long read, Josh, I really liked the comment from @Anthony Thompson suggesting that you guys should consult with an attorney. 

More importantly, I think it's probably a good idea to dip your toe in the muddy waters of Real Estate Investing by acquiring a small multifamily property (preferably a 4-unit) if you are able to find a building that has a unit with 3bed/2bath or something similar for you and the family. This way, you get a taste of landlording and owning a rental property.   

During this period, you and your wife fully appreciate that this isn't your forever home and it is a sacrifice to get you guys to where you want to be. Naturally, you start to learn more about Real Estate Investing and really know your temperament as an investor, especially living with your tenants, an interesting learning experience. (I've done it and it is sure interesting). 

Now, you are in the nearest future with some experience and confidence under your belt. Hopefully, you are better positioned to know how you want to deploy that capital you have to achieve your goals. 

Time is an important factor in the learning process, and I'm sure you of all people know just that.

Good luck to you guys and welcome to the world of Real Estate Investing.  

@Lisa Eckman why are you looking outside of your area? I’m sure you can find some local deals to get into.

If you are putting up the money to purchase the property and you want the partner to put up the rehab money and manage the project may be a 50-50 split the profits and compensate the operator for managing the project.

Make sure you find a qualified operator and get all the agreements in writing. You want to have an attorney draft the partnership documents and security instruments.

Lisa,

If you have the cash for the entire purchase here in CA, why do you need a partner? Simply hire a general contractor and a project manager for a fee and keep 100% of your profits avoiding the hurdles and headaches that can come with partnerships.

@Josh Johnston Haha no need. This is not an entirely altruistic act. The more I help people on BiggerPockets the more business I get. The more business I get, the more I can invest. The more I invest, the sooner I can retire to a life filled with fishing, laying on the beach, and playing video games.

@Josh Johnston If you and your wife are willing to make the sacrifice of having a shared wall I would try to house hack a nice large 2-4 unit in a nice neighborhood. Near Columbus, there are some nice multi-units in Dublin. These properties go for a lot of money, but they still have a better cash flow than the single-family properties in the area. Dublin also has some of the best schools. This investment makes for a nice buy and hold.

I am sure there are similar neighborhoods in Cleveland.

@Josh Johnston it sounds like you definitely have a lot going on!

If it were me, before you do anything in real estate I’d consult with an Ohio attorney about asset protection for your wife’s inheritance money.

Real estate can be fraught with liability incurring activities so I wouldn’t want to see you imperil your family’s financial future by trying to make a little return in real estate without adequate protection.

After establishing a good base of asset protection I’d recommend starting slow with ONE buy and hold and ONE small rehab/flip - not a heavy rehab, small or medium rehab only.

Once you learn the business a bit (buy and hold, and rehabs) then I’d say you could branch out to private lending. I just think you’ll be a much better lender once you understand where your borrowers are coming from.

I'd also recommend attending your local real estate investor group/REIA once you get to Ohio. The goal would be to make friends with other landlords, flippers and hard money lenders.

But I’d also caution you NOT to sign up for expensive seminars or coaching programs. Some of those things are well oiled sales machines designed to sell thousands of dollars or marginal education and it seems like in almost all cases you would do a LOT better to put the same amount of money into an actual property or project. You’d learn a lot more and in the case of a property you’d still have an asset to show for it at the end.