90% of millionaires own real estate. If you’re looking to get started in real estate investing, you need to know these 5 things first.
Video Transcript
You shouldn’t invest in real estate until you understand these five things.
Warren Buffett said you shouldn’t invest in a business that you don’t understand. Real estate is a business and you should learn about it before you get started.
My advice is to not pay out huge amount of money to learn about real estate, but you need to keep learning.
My number one mistake in my first two years of real estate investing was thinking that all I could do was save money for a down payment and nothing else. If I would have listened to the podcasts that I was already listening to and actually taken notes and tried to understand what was the deal, I would have gotten a lot further.
Instead of listening to people’s inspirational podcast stories about how they succeeded as a real estate investor. I should have been in the nuts and bolts of learning about how mortgages work. Learning about financing. Learning about how to make a good deal. Learning about how to comp a property. I didn’t do any of that.
If you want to learn how to effectively learn about real estate investing like and subscribe, and the next video that I’ve got will point you to a video I’m doing on that topic.
A goal without a plan is just a wish. If you’ve ever read The Little Prince, you’ve heard this valuable life lesson before.
And it’s true for so many beginner real estate investors.
My first few years bouncing around real estate,
I didn’t have a plan or a vision.
I had done some vague calculations that for the average cost of a home, I’d need 20% down, which was $40,000.
And I put my head down and all I did was save.
That was my plan. And it wasn’t very concrete.
If I would have written down a plan with a bigger vision. I probably could have gotten going a bit faster.
Have you heard the quote? The best time to plant a tree is 20 years ago.
A lot of people have said similar things about real estate investing.
The important thing to realize is that if you get captured by the snazzy headlines on the Bigger Pockets podcast or any other real estate educational forum,
it might be motivational, but it can be dangerous to get going before you know what you’re doing.
Take your time.
You may be only able to do one deal a year at the beginning,
but commit to the long game.
Set your sights on investing in the long run and you’ll be a better investor.
Find your tribe. There’s loads of ways to connect with other real estate investors and find ones that are doing something similar to what you want to do. You can find them on meetup.com with local meetup and REO groups. You could find them on the bigger Pockets forums and the bigger pockets events, pages.
You’ll want to be networking and talking to people that are doing what you want to do.
They can help you unblock yourself and learn some things a little faster.
Eventually, they can help you find investor friendly agents. I’ve got a video on that already, if you want to check it out after this.
You need to know why you’re doing this.
If you’re getting started in real estate investing, you need to understand why.
It’s good to ask yourself, Am I ready to spend the next ten years doing this?
Real estate investing is a long term game. You don’t just get in and out in two years.
If you don’t know why you’re doing it, what’s going to propel you when things go wrong, things probably will go wrong. You just need to know why you’re doing it so that you can keep going.
The hard parts happen at different parts of real estate investing. Sometimes it’s when you’re looking for a deal. Sometimes it’s when you’re under contract and making negotiations. Sometimes it’s after you’ve renovated a property or the stress of renovating a property or having tenants. Things can go wrong at any stage.
There will be problems and headaches along the way. And the reason why you’re doing this needs to be stronger than your reason to quit.
And finally, this one is a bonus tip. Be flexible. There are more ways to invest in real estate than you understand today.
There’s single family homes, there’s multifamily homes, there’s senior housing, there’s short term rentals, and there’s way more than I can list in this video. Just be open to knowing that your plan might change over time. And that’s okay. Just be ready to go along your way.
I’m excited to help you along the way and grow together.
See you next time.
If you’re excited about being a beginner in real estate investing, check out my next video.