How to Begin Investing in Real Estate – 6 Steps to Finding Amazing Deals

DealI get emails and other correspondence quite often asking me how to begin investing in real estate.  When you are trying to find your first real estate deal, real estate investing seems very complicated.  It’s not that difficult, but you have to understand that deals are not on every corner, at least not at the sellers price.   It takes diligence, looking at many potential deals, in order to find ‘the one’.  Then you have to find the next deal.  Professional investors are everywhere, and they make a living in every city.  You can do it too, but you need patience, persistence and determination.  And some seed capital.

How to Begin Investing in Real Estate

Are you still struggling to find good deals in your market? What are you waiting for? I hear it all the time: “My market is so overpriced; there are no deals.” “I looked for a deal, but the numbers do not work.” “I am trying to find a deal with no money down and cannot find one.” “All the properties I look at need work.” “My real estate agent can’t find me good deals.” “The ‘Bay area’ has no deals.”

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Are you still looking to get into real estate investing?  How long have you been trying to ‘get a deal’.  

 

3 Strategies to Avoid Student Loans

Student LoansWhen I went to college, I took out thee student loans of $2,500 each.  I did not actually get the entire $2,500, as there was something like a “funding fee”, so I only received ~$2,350.  I had some VA benefits, which paid an additional $225 per month (for 36 months), of which I had previously contributed $75 a month for (for 36 months).  The interest rate was ~9%.  A total benefit of $5,400.

I really did not need the student loans, but it did give me some cushion, and helped motivate me to continue school.  I did not want to make the payments, and if I quit school I would have to pay the loans back.  I got the loans and out the money in the bank for an emergency fund.

I had some small grants, which totaled less than $500.  I lived at home, and commuted to school with my old truck and car.  I did not actually have anyone else living with me, but it was a property my father owned and I paid some rent.

My vehicles were old and tired.  I remember getting stranded several times by each vehicle at different places throughout the cities.  Ball joints that gave way, cam shaft gears that came loose, clutch cables were among the problems that I dealt with.

I also did work though, quite a bit.  So, I was able to retire my student loan debt shortly after graduating.  I was a bartender and did several other side hustles while in college.  i lived cheap, and spent many hours at the gym, which was nearly free.  If I could just get back to the gym as often, it would be a great thing…

Here are some ideas from Nate Matherson is the Co-Founder and CEO of LendEDU

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June – July 2015 Rental Cash Flow

100-PDThe past few months have been pretty busy.  The rental cash flow has been as expected.  I have had several turnovers, and some other maintenance issues to take care off.  Luckily, all is well and the rentals have moved forward for another month.

Hopefully you have had a chance to look at some of my other cash flow posts and have been following my retirement countdown.   As I get more detailed in my own retirement dashboard spreadsheet, and add more check points and cross checks, I realize this next year of working is mostly an exercise to put the final nail in the coffin of the cube farm.

So here is how the past month went…

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Countdown To Retirement – Financial Check Up 06/2015

Back in January 2015, I created some financial goals as a countdown to retirement.  The goals were pretty aggressive; it’s time to see if I have lived up to my plan.

It is one thing to create a plan, and another to follow through with the plan.  On January 1, I had 551 days until I leave my full time job.  Today, it is closer to 380, with only 230 work days left, or 54 weeks.  That is only 60% work days, as I have some vacation and holidays coming.  And it doesn’t count sick days.  But who is counting…?

As the days draw closer to the last day of full time work, and the last days of getting a steady paycheck, I check my retirement plans very often.  Way more often than needed.  Does a retirement plan need to be checked every hour?  I sometimes think it needs to be checked even more often, especially when the market is soaring.

Here is how I have progressed.

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May – June 2015 Rental Cash Flow

packs-163497_1280-PDGetting your rental cash flow on time is the name of the game.  Mine is almost like a broken record.  Rent is due, rent gets collected.  If you are a landlord, collecting rents on time is what you want.  For a landlord with only one or two properties, getting rents on time should be routine.  Keeping track of 24 properties is a bit more of a challenge.  I have done this for quite some time, and it all has to do with getting great tenants.

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Signs You Might Be a Bona Fide Real Estate Investor

Dream bigIf you have ever contemplated becoming a Real Estate Investor, there are things that you must understand.  Once you cross the line, your life will never be the same.  You will have crossed to the ‘dark’ side of making money.  A 2% savings return will look paltry.  Of course, just getting back your initial investment might also look like a windfall.

Things you take for granted now, will forever be gone.  But you will persevere, for you know that the fruit will be there to harvest at a later date.  Sooner or later, you will be able to pick the fruits of your labor and enjoy them.  And no one will tell you that you have to wait until  you are 62, or 65, or 67 or 70.

Your view on other properties will change.  How much can you buy it for, how much can you sell it for.  A distressed house on your own block becomes an opportunity, not an eye sore.  A friend with money may become a partner, not someone to envy.  A junk toilet sitting in your backyard becomes a trophy, not a piece of junk (not right away anyway…).

When a new large store is being built, you hope it is a home improvement store, not a clothing store.  You look at all the colors of paint on the color wheels, and know that only one or two would you ever buy.  You realize that many of the paint colors should be illegal to sell.

You are a Real Estate Investor!

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How have your views, on anything, changed once you became more involved and in tune with the activity?  Have you ever thought “I will never think or do something like that”, and then a few years later you want to “think like that”?

 

 

 

Simple Appliance Repairs for Landlords (or Homeowners)

Appliance repairWith any issue, if you can do some simple appliance repairs as a landlord, you can save a ton of money.  In my rentals, I find that some appliances are worth fixing, some are not.  Here are a couple of recent simple appliance repairs that I have completed.

I typically buy fairly cheap appliances.  I always buy new, and make sure that they are 100% clean for all new tenants.  Of course, I also expect the tenants that are moving out to keep them clean.

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How to Get Rid Of a Couch For Free

Get Rid Of a Couch As a landlord, especially if you cater to a low-income tenant base, you will no doubt have to get rid of many stuffed chairs, love seats, hide-a-beds, futons, mattresses, box springs and couches.  And more.  If you know how to get rid of a couch for free, it will save you a lot of money.

This posting is somewhat of a companion article to one of my previous articles about how to get rid of a mattress for free.  This couch was left over from when I asked my Section 8 tenant to leave.

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April – May 2015 Rental Cash Flow

packs-163497_1280-PDThe rental cash flow was a solid as ever.  All of the 25 rents were all collected and deposited mostly by the third of the month, again.  It is a rather boring record, but if you have ever been a landlord, you know this is a great achievement.  I did have one rent that arrived on the 5th due to a bill-pay error?, and a $225 partial rent paid for the remaining sum owed on the 8th.  The bill-pay error was more due to forgetfulness, than an error.  These are solid tenants that are moving out to buy a home, so they have plenty of money.

So here are some of the cash flow highlights of the past several weeks…

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Maximizing Revenue from Your Rental Property

Saving-MoneyAre you maximizing revenue from your real estate investments? If you have rental property, there are literally hundreds of ways to make extra money. I often thought if I had 20 properties to take care of that it would be a full-time job for someone, possibly me. In addition to the rental income, at a time I was running a small lawn care company, trying to generate enough money to live on. That mowing, plowing and miscellaneous maintenance also generated capital to kick-start my seed money for real estate investing.  Never underestimate the power of saving money, or the ability of a side gig to create a lot of extra capital.  Every hour you spend making money for yourself, is an hour less you have to work for someone else.

Now that I have my rentals, I always look to save money or generate new revenue streams from my tenants. I am not looking to gouge them, but for ways to leverage my skills and their money.

Here are a few tips that  I have either done, or have thought about doing.  Actually I have implemented all but one of them, although not every one on every tenant.  Most are common and not rocket science, some are not.

If you have ever wanted to quit your full-time job, and wondered how it would be possible with only a few rentals, this could be a way to help with your ticket out of the drudgery of working for a boss.

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