All Forum Posts by: Joshua Amezcua

There are ~17M real estate investors in this country who own at least one property outside of their primary residence. So that's the "technical" answer. 

More / interesting insights: 

These investors are estimated to participate in the purchase ~960,000 transactions this year.

I’m not sure what percentage of these transactions are done by new, first time investors, but I’ll be surprised if it’s less than 30%. So, there's 300,000 new investors per year.

Of the ~28M structures (45M in rental UNITs) in this country that house rental units (most of which are single family rentals, duplexes, triplexes, and quadplexes), 90% are owned by “retail” (less than 10 properties) investors.

60% are owned by investors with just one or two properties.

We do not know how many owner occupied transactions involve “house hacking”, “live in flip”, or how many "second home purchases" are purchased with the intent to invest. But, I bet it's several hundred thousand incremental transactions per year. 

On top of that, many people become "accidental" landlords when they inherit property or can't sell a primary for some reason when they need to move.

On top of that, there is a large, unknown, contingent of "investors" who are wholesalers, agents, or otherwise involved in the real estate industry but do not actually own property in a meaningful way. 

On top of that, there are millions of households that invest in REITs, syndications, private placements, or invest through other similar partnership structures.

On top of that, up to 30% of the US adult population is "interested in" investing in real estate. That's 50M+.

So, on the low end, you have 300,000 new investors per year. More realistically, we have somewhere between 500,000 and 1M first time investors who are buying through a means other than a traditional investment purchase. 

To answer your question in the most unhelpful way possible, I have thus concluded that there are between 300K and 50M people who are serious about real estate investing in this country and would thus classify themselves as investors. 

The "right" answer to this question, of course, is 2.8M. That's the number of investors who have created a membership on BiggerPockets, establishing the legitimacy of their intent to invest :). 

@Joshua Amezcua there are lots of investors, but that doesn't mean you are in competition with all of us/them. I would focus more on the market and remember that high tide rises all ships. Also, it sounds like you have a strategy already, don't switch to BRRR or 30 day flips, just keep doing live in flips, so you can be patient doing the work yourself and get owner occupied financing.

@Joshua Amezcua

BRRRR is great, at the moment though BRRRR is more of an equity strategy than a cash flow strategy.

Look up the "frequency illusion"! 
The Baader-Meinhof phenomenon, also known as the frequency illusion, is a cognitive bias that causes people to see something they've just noticed everywhere.

Trust me, I shake my head once a week for waiting so long in my life to start investing myself haha. 

You have a really solid foundation already in place with your two homes and the ability to utilize VA benefits. I agree in keeping your current homes and tapping into the equity you have. Assuming you have at least 20% equity in them, utilizing a HELOC might be a logical move to consider.

I'm curious, are you leaning towards a strategy in investing in rentals or flips?

Overall you are definitely ahead of the curve compared to most who are just starting out, so major kudos for that. The bones are there. 

I'm in Phoenix as well, and it certainly has been feeling that way for at least the past 3-4 years. As others mentioned, AZ used to be this hidden west coast gem that you could get in at a low price and walk out pretty nicely deal wise. "If you can't afford to invest in Cali, invest in AZ" is how I sum it up. 

I think the rates dropping to 3% brought additional awareness. I believe this made people stop and ask "why don't I just buy a house and then eventually rent it" without even knowing house hacking has been used for a while as a strategy.

Also AZ is a huge testing ground for new "innovations" in real estate. Tech companies test out real estate software and use Phoenix as a playground. Also from a real estate law standpoint, they use PHX to test the waters a lot as well. 

Not to mention that people are flocking to get their real estate license left and right (and then most will leave in 1-2 after they struggle to find leads).  

AZ is definitely a bit congested. We just need to let it run its course. 

As long as you have money, and right network, don't worry about saturation. USA is too big and has too much money, everybody can win for now. 

A lot!

The Seattle is saturated with investors. However, very few stick it out long enough to be successful and even less scale it up.

@Joshua Amezcua

I think you've hit on something - in the last few years, especially when interest rates were low, a lot of investors were pushed into all sorts of investments - wine, crypto, NFTs, real estate - searching for yield that they couldn't get in savings and bonds.  And yes, everyone with a house to sell (and lots without) are getting marketed to.

With that said, though, I think a lot of people come in with a lot of enthusiasm and aren't willing to put in the time or the work. For example, it took me a year to find my first BRRRR, and 3 years to find my first seller finance deal.

So - I don't see a lot of posts from people saying "I'm ready to spend the next 3 years being patient and saving up."  They all want to buy NOW.  If you can stay patient, save up, be conservative, and hang on, you'll get way ahead.