All Forum Posts by: Spencer Hilligoss

Welcome @Hayden Harrington!

@Luis Torrico - fellow Californian here. Congrats on getting started. I made the mistake of buying our first rental here in Cali. Still own it, but I wish we'd spent that $100k cash more intelligently to have it go further.

I think the first 2 key steps that I skipped, and most folks do, is to decide what goals are and what strategy you want to deploy to achieve them.

Example: active vs. passive (time consideration) - I was working fulltime when I bought a rental and even with a property manager, it took more time than I expected.

Assuming you are passive, what matters even more than the "where" is the "who." Since you'll likely be working with someone else (example: maybe buying turnkey SFH's), you'd want to double-down on vetting the company you work with... instead of limiting the pool based on where they operate.

Good luck on the search!

@Priyal B. I think it’s always a good time to get into a good deal. It’s never a good time to get into a bad deal.

“Multifamily’” means anything over 5+ units… so getting into it can mean different things, depending on your goals and strategy.

First step is to decide whether you intend to be active or passive. If you have no available time, active investing may not be the right path since it will gobble up your limited hours.

Second step is to decide what type of performance you are looking for out of it - looking for cashflow v. growth.

I wish I had gone through that^ exercise instead of buying a local duplex out here in California. I could have saved capital and dozens of hours of times (maybe hundreds).

@Max Katelouzos great question. We recently refinanced out of our HELOC after tapping it for a few years. We used it to the max and it was incredibly helpful. Personally, i'm a proponent of it… if:

*You are confident you have a predictable way of paying it off via other income streams coming in

*You have at least some form of cash cushion, in general

*You read all of the fine print with the lender you work with, so there’s no funny business

I like HELOCs and rates are ridiculously good right now. If you haven’t looked at cashout refi’s, that’s worth looking at, as well.

@Tucker Cummings 

If you’re early in your career and thinking about things this way, you’re off to a helluva stronger start than the vast majority of professionals in the working world. Take pride in that.

My 2 cents: if you’re going to spend 40 hours a week working a day job (i did for 13 years, and I actually enjoyed most of it!) and investing is a real priority for you, i’d stay open minded to switching into a line of work that allows you to significantly increase the W2 income that the job can create and enables you not to ‘take home work with you.’ I’m biased, but I think sales roles with high cash compensation are a great example of that type of role. I can’t tell you how many people i’ve hired and chatted with who said “i’m not a sales person” and they find themselves pulling down strong, stable income from it. That said, some people truly aren’t meant for it and there are other ways to make solid income from the w2 world. The key takeaway on this point is this: if you’re making low income in a w2 role, at least make sure it’s adding educational value you to you in a meaningful way. Example: some younger investors go and get jobs in the real estate business so they can ‘get paid to go to school’ Of course, that’s a rosy interpretation of a job that’ll still be hard and frustrating at times, but so it goes in life, right?

Personally, we use ‘high yield’ savings accounts for our emergency funds. We don’t use them for anything else.

The other best way to create new income streams is to monetize some form of side hustle you can work on nights/weekends. Set it up early and hold off on the real estate investing for a bit while you build up capital and get a repeatable way of getting more.

Day job: pay for life

Side hustle: build capital to invest

Endless other ways to do it, of course

Top worst advice: “you should flip a house!”

Second worst advice: “you should hire that coach!” (for $20), mismatched to my target strategy)

Third worst advice: “X strategy is better than Y strategy” (rentals v. syndications v. flipping. Wholesaling v. v. v. v. etc.). Note: there is rarely a ‘better.’ It entirely depends on your unique goals.

@Everett E. thanks for sharing the details of the proposition. Recently i've been fielding more questions from current/new investors about the role that wealth management can (should?) play in alternative investments, in general - beyond just syndication investing.

@Taylor L. @Bryan Hancock @Mike Dymski all raised points I align with: 1% ongoing in unappealing. Also, the market is so saturated with offerings... so much so that there’s no reason to have to pay a fee like that. 

I personal think Mike nailed it on the “vetting” comment. It’s easy for someone to claim that they are vetting a sponsor/market/deal. It’s another thing have a series of structured questions, approaches you use to dig into with the person to understand what the vetting really means.

Re: crowdfunding - often, when folks ask about “the differences between crowdfunding and direct syndication investment” - it often results in a legalize style ‘it depends’ answer.. .because not all crowdfunding platforms are created equal, either (much like sponsors, syndicators, co-sponsors, etc).

Best of luck in your research!

Disclaimer: i’m biased. Most are. i’m an LP+Co-Gp, myself and a FINRA member broker-dealer handles our back office.

Welcome @Nicole James!

@Omar Gonzalez sounds like you're taking your time to build the network and do sponsor-level diligence. When I first started LP investing, it took me a while to hone in on my vetting criteria. A key learning I had was this: it’s possible to go beyond “the podcast circuit.” It takes more work, patience, time and networking… but awesome sponsors are out there.

Welcome @Mario Lopez! No embarrassment warranted. I grew up in a real estate household (Dad was a broker for 30 years) and I even worked in the business as a teenager.

It still took me 10+ years into a corporate career to start investing in real estate. Now i’m a full time investor. There’s hope for all of it and it’s never too late!