Im 22 years old and have around 130k in the bank ready to go. Was just wondering if anyone could give me some advice on how to get started and how to use my money. I just want to start off simple in the way of buy a house on a big block sub divide and build just to get the feel for it. Any advice would greatly be appreciated. Thanks
You need to learn the business of real estate investing. $130,000 is a modest amount in today’s real estate market; it may be a nice down payment on a $400,000 property. In the active business of real estate investing you don’t use much of your own money. Either you take over the seller’s loans or you barrow “hard money” (Short term loan at high interest rate barrowed from private lenders.) There is a lot of detail behind what I have just told you. I recommend you take a seminar. They are expensive maybe $5,000 for two weeks. I cannot recommend who gives a good seminar where you live. I’m sure there are a lot of charlatans in the business. After you think you have learned what you should know the real seminar occurs when you go through your first few deals.
130k is a great start and if used properly will fire you ahead. I would look at using most of the 130k for a bricks and morter purchase, leave a little in reserve. Now you will be able use the equity in your new purchase plus the rent you draw to increase your borrowing power. You now have equity plus extra income to borrow against. Also a word of worning and please this does not apply to all, be verry carefull of attending seminars on P.I. Ive seen a few friends ripped off and others completely confussed. Good luck.
Cam111
If you are inexperienced and wanting to start and want to get hands on with your first project perhaps looking for a joint venture project with a like minded ‘experienced’ investor might be a way to go so that you can experience and be mentored by someone who has done it all before. This would be a win win…hey! Obviously, having said this you must carefully form the joint venture contract to secure your interest.
Probably good idea to deal with someone in your area where you can gain local knowledge yourself. This would be a real life seminar where you will make some money rather than risking $5k or so on theory.
Hope this helps…good luck on your journey. [smiling]
G3
G3 is righ; although I would first research the market and check with the council as to how many developements are approved and the vacancy rate. It would be a nightmare if your nice units just sit there idle.
It’s happenning already in my neck of the woods. The developer has sought council to remove the medium density overlay to allow for a permit for low density housing.
Maybe you need to find problems to solve to differentiate from the herd mentality.
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