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This will be a thread on a basic overview of the ways to get into Real Estate:
I decided to make this thread due to the large volume of people asking how they can get into Real Estate.
I decided to make this thread due to the large volume of people asking how they can get into Real Estate.
The first thing to note is that not all Real Estate is the same.
For simplicity purpose, I will break it into two categories,
Commercial
Small Family
For simplicity purpose, I will break it into two categories,
Commercial
Small Family
Commercial:
This definition of Commercial Real Estate or CRE would be Retail, Multifamily and office buildings.
These buildings are much more expensive than a typical small family house or duplex.
In most states especially on the coast, CRE starts at the low end 1 Million
This definition of Commercial Real Estate or CRE would be Retail, Multifamily and office buildings.
These buildings are much more expensive than a typical small family house or duplex.
In most states especially on the coast, CRE starts at the low end 1 Million
I would say the average transaction level for a noninstitutional small portfolio firm would be 2-4 million.
As one can see due to the price tag CRE has extremely high barriers to entry.
Besides the price, CRE is also harder to get into knowledge.
As one can see due to the price tag CRE has extremely high barriers to entry.
Besides the price, CRE is also harder to get into knowledge.
A CRE building value is derived from the cash flows it offsets. This creates many metrics to evaluate the property.
Although most metrics are mostly unneeded noise it is important to have a strong idea of basic Finance principles.
Although most metrics are mostly unneeded noise it is important to have a strong idea of basic Finance principles.
Small Family:
Small family houses would include properties such as the house you live in currently as well as things like duplexs
The big difference here is that the value of the property is mostly derived from the other properties around it and not the rent you can command.
Small family houses would include properties such as the house you live in currently as well as things like duplexs
The big difference here is that the value of the property is mostly derived from the other properties around it and not the rent you can command.
So now we know the difference between these two asset classes you much determine where in your life you are.
I will again classify this into two groups:
Established career
New Career
I will again classify this into two groups:
Established career
New Career
Established career:
This would be someone who is already established in their career and is making a strong salary.
The best option here for someone here is if they are interested in Real Estate is to start making a portfolio of their own to retire on or live off of.
This would be someone who is already established in their career and is making a strong salary.
The best option here for someone here is if they are interested in Real Estate is to start making a portfolio of their own to retire on or live off of.
Because your career is already established switching careers would be silly as you already have a steady income.
Instead your goal should be to start banking cash and learning. While you are saving money knowledge is important.
Instead your goal should be to start banking cash and learning. While you are saving money knowledge is important.
Learn as much as you can so when the time comes you will be able to execute without hesitation.
Depending on your income you also need to decide on the type of Real Estate to invest in.
If you make $50,000 a year it will take a long time to invest in CRE.
Depending on your income you also need to decide on the type of Real Estate to invest in.
If you make $50,000 a year it will take a long time to invest in CRE.
In that case, you would be better off buying SOUND small investment properties until you can build up through REFI and income to buy CRE.
If you make $200,000 a year then saving for CRE is much more probable.
If you make $200,000 a year then saving for CRE is much more probable.
Most people don't like the advice above and instead want to focus on getting investors as people don't like to save.
Getting investors is a comittment. If someone is willing to give you money they will expect you to quit your job.
Getting investors is a comittment. If someone is willing to give you money they will expect you to quit your job.
That means no more health insurance, stable income etc....
This is not feasible for most as they have kids, wife etc....
This is why for most people in this first category saving is more important.
This is not feasible for most as they have kids, wife etc....
This is why for most people in this first category saving is more important.
New Career:
In the new career camp, we have younger people maybe graduating from High School or college.
These people are young broke and ready to learn.
Because you are young your best goal if you want to get into Real Estate is to learn and break into the industry.
In the new career camp, we have younger people maybe graduating from High School or college.
These people are young broke and ready to learn.
Because you are young your best goal if you want to get into Real Estate is to learn and break into the industry.
I would advise you to check out @TheRealEstateG6 blog post on how to do this.
He lays out the details very well on how to do this.
He lays out the details very well on how to do this.
If you are young and you know you want to be in Real Estate long term this is a great way to break in.
You can work at a firm and then utilize your knowledge and saved cash to buy your own properties down the line.
You can work at a firm and then utilize your knowledge and saved cash to buy your own properties down the line.
Closing thoughts:
The most important thing to understand about Real Estate is that it takes time.
If you think you are going to buy a 3 million dollar building in a year you are delusional.
Patience is what wins the Real Estate race.
The most important thing to understand about Real Estate is that it takes time.
If you think you are going to buy a 3 million dollar building in a year you are delusional.
Patience is what wins the Real Estate race.
Real Estate is expensive but it produces long term wealth like no other asset.
Patience and saving your money is key in this industry.
Control your spending, bank your money and learn.
These things ^ will make you rich.
Patience and saving your money is key in this industry.
Control your spending, bank your money and learn.
These things ^ will make you rich.
