Real Estate Investing

[Destind4]

Has anyone had any experience in real estate investing? I've been researching the subject for awhile, and have yet to scratch the surface. I've narrowed my approach down to two options: buying a house and renting it out or finding a great "Subject To" deal and take over existing payments. If anyone has any expertise in the field, how would you approach your first deal?

[snafu]

I don't want to turn you off your goal to buy a SFH to rent. If you know a landlord I suggest you meet up to talk about the ups and downs of renting. I know from experience that you need to be able to carry the costs just when money is tight! Tenants do weird things and you need basic fix-it skills as journey tradesmen are expensive and some will take advantage of a landlord who isn't familiar with what's needed.

The secondary risk is in being able to judge people with very little information. Pick the wrong person and it takes months to get a deadbeat evicted. 'Subject to' sounds interesting. I guess it requires calling realtors that you know to let them know you're interest. Are these listed with mortgage defaults? I'[d suggest working with a lawyer that specializes in real estate as agreements need to cover a great many contingencies. You need to find an excellent home inspector as people don't release their homes easily and problems are often invisible like contaminated land etc.

It's a lot easier to buy a REIT.

[feh]

It's a lot easier to buy a REIT.

+1 on REIT, unless you are absolutely positive you want to be a landlord.

[97guns]

i have 5 single family home that i rent out, you will always get the pros and cons but for me RE is THE best investment out there. i make 10-12% return on investment just on the rents with houses leveraged with a loan and 7-9% on homes that i own outright. i get my entire investment returned to me in 7 years with homes i have leveraged, year 8 and beyond is pure gravy in the pocket, not even mentioning the gains in equity

sure there are problems, right now i have a broken pipe in the concrete subfloor of one of them, i have to have the cement cut open and pipe repaired, second time in a year with the same house. claiming it on insurance again, last time i put 3K in my pocket, this time should be more. ive had to replace the water heater on all 5 homes and put new flooring in 3 of them but in the end i pay very little to ZERO income tax, have not paid income tax in the past 4 years, this coming year i will have to because i added #5 all cash.

there are lots of ways to get a good tenant in, i can share my managers practices if needed.

[Destind4]

I'm completely lost. What's a Re?

[Destind4]

Nevermind, I did a little research on the acronym. I'm primarily focused on tangible assets (i.e. silver & real estate).

[97guns]

Nevermind, I did a little research on the acronym. I'm primarily focused on tangible assets (i.e. silver & real estate).

thats all i hold is tangible assets

[Rachael777]

I agree w 97guns that real estate is a great investment and you do not have to manage your own properties. so you do not have to be getting up at all hours or whatever. You do have to have some basic fix-it .. home maintenance knowledge to keep on top of people but you can learn that. Homes create cash flow. You can create cash flow through real estate faster than saving up million of dollars that will eventually throw off cash flow. 97guns story illustrates that .I do not know the all the info on his story but apparently he made the leap.. used $300k and bought 4 homes and got immediate cash flow.. allowing him to stop working. then he saved/invested along the way.. got some family inheritance and hear he is now. I suggest you look at buying on 'contract' from a seller as an option too... seller financing. There are many sellers who have 'made their money' and just want out of real estate and are willing to sell you multiple properties at below market. that is what I did that enabled me to get in quick in a big way. Of course real estate. along with any other investment is risky and there are riskier ways to do it than others. Listen to others, research, have your 'worst case money' available and then choose your own path.

[Rachael777]

I agree w 97guns that real estate is a great investment and you do not have to manage your own properties. so you do not have to be getting up at all hours or whatever. You do have to have some basic fix-it .. home maintenance knowledge to keep on top of people but you can learn that. Homes create cash flow. You can create cash flow faster with real estate than saving up million of dollars that will eventually throw off cash flow. 97guns story illustrates that .I do not know the all the info on his story but apparently he made the leap.. used $300k and bought 4 homes and got immediate cash flow.. allowing him to stop working. then he saved/invested along the way.. got some family inheritance and here he is now. I suggest you look at buying on 'contract' from a seller as an option too... seller financing. There are many sellers who have 'made their money' and just want out of real estate and are willing to sell you multiple properties at below market. that is what I did that enabled me to get in quick in a big way. Of course real estate. along with any other investment is risky and there are riskier ways to do it than others. Listen to others, research, have your 'worst case money' available and then choose your own path.

[Destind4]

Thanks Rachel!

[97guns]

I agree w 97guns that real estate is a great investment and you do not have to manage your own properties. so you do not have to be getting up at all hours or whatever. You do have to have some basic fix-it .. home maintenance knowledge to keep on top of people but you can learn that. Homes create cash flow. You can create cash flow through real estate faster than saving up million of dollars that will eventually throw off cash flow. 97guns story illustrates that .I do not know the all the info on his story but apparently he made the leap.. used $300k and bought 4 homes and got immediate cash flow.. allowing him to stop working. then he saved/invested along the way.. got some family inheritance and hear he is now. I suggest you look at buying on 'contract' from a seller as an option too... seller financing. There are many sellers who have 'made their money' and just want out of real estate and are willing to sell you multiple properties at below market. that is what I did that enabled me to get in quick in a big way. Of course real estate. along with any other investment is risky and there are riskier ways to do it than others. Listen to others, research, have your 'worst case money' available and then choose your own path.

ty for timelining my journey through real estate investing, it has been a quick 5 year journey that has seen my net worth grow from under $300K to 1.2m, albeit i did receive around 200K in inheritance, the rest came from rents on the properties and gains in equity.

if i were to go in right now i would buy with a loan, i think you can get in with 5%, if not then 10%. i would look for single family in decent neighborhoods with good surrounding economy and ample jobs. with a minimum down payment your risk is actually pretty low and like i said you will get that full down payment back in 7-10 years just through rent provided your numbers are good.

[Destind4]

What would you say to someone who has 12k in the bank & looking to get started?

[rennigade]

What would you say to someone who has 12k in the bank & looking to get started?

Save more and dont get started till you do. I know very little about investing in real estate...but I can only assume if you're looking to buy something and hold it/rent it out...you need to have a hefty amount of cash on hand to be safe. $12k could get eaten in a very short amount of time if all doesnt go well in your favor.

[Destind4]

I figured that much...

[Destind4]

I'll have well over 20k by this time next year. I'm going to find a 3bed/3bath in either North Carolina or Georgia & find a roommate to help payoff the loan sooner.