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A lot of people can make money in a hot market. Don’t confuse that with being skilled in real estate investing. And don’t let that cause you to lose sight of risk management.
“A rising tide lifts all boats”
I started out with a ton of real estate investment books and highly suggest reading The Book on Rental Property Investing by Brandon Turner. He also has a helpful podcast on all things real estate with Bigger Pockets on Spotify.
Books and podcasts like this helped me immensely and I was able to purchase my first primary residence about a year and a half ago at the age of 24 and am currently doing research/financial planning for an investment property. Good luck with getting started!
As someone who is in the diligence process of my first several doors at 21, wing it, in a calculated way.
Find a market where it makes sense (Texas isn’t a great market for rentals due to taxes, where I live on the East Coast has high barrier to entry), so I had to go to the Midwest.
Ensure you run your numbers, make sure everything is covered, even those once in a while situations.
Save, save, save. Save your income from W2, to buy or put down money on a place, save your rental earnings in a High Yield account and don’t touch them unless looking to buy another property. You never know when a water heater will go out, or when a storm will knock off your drains. Have money for the unexpected.
Don’t let lifestyle inflation creep on you. I hit 200K as of Friday with a new job offer a nearly double increase over what I was making. That means more money to invest. Although I can afford a new Tesla/C9/Range Rover, it makes more sense for me to invest that money somewhere where I can have recurring income over the long run.
Have a great relationship with a set team. My broker is amazing, my realtor is great. They work quick and work in tandem with me. I know once I close on these first few doors, I am immediately starting the process over to hopefully get another quad by the end of Q3.
Investing in owner occupier at first, then my broker gave me a way for 0 down for my next deal, requires higher rate though.
Kudos to you for thinking of starting early…there is so much free knowledge out there, I wouldn’t recommend paying into membership for these big RE educational companies like Keyspire in Canada but would highly recommend joining the public Facebook groups such as Keyspire, fearless real estate investors, a local group. I learnt a lot by what others were asking on these public forums and then what people would suggest, I then went ahead and googled the terms or concepts I didn’t understand. Meet people, connect and learn….remember if it’s too good to be true, you might not have all the information. Everyone can make money when the market is trending up, but you need to learn how to make money or manage risk when it’s not trending up. Don’t be in a hurry to invest, you have a lot of time on hand…learn, find the right people that you can trust, and then invest as a private lender, JV, LP/GP deals. You will learn hands on while working with someone who knows what they are doing. Unfortunately I don’t have any contacts in the US as i am in Canada. But feel free to reach out if you have any other questions. Wishing you all the best.
Appreciate your detailed response!
Don’t partner with idiots. I did and I lost 30k on a flip and am having a hard time on another one I got in with him at the same time. I am stressed to the max.