What is the best advice for someone that wants to start a real estate investment company?
Posted on May 21st, 2010 in Renting & Real Estate | 2 Comments »
jeffnicolas asked:
I'm 20 years old, with about $60,000 in capital. I' tired of working for these jobs. I want to start my own company and i love real estate. I'm not in it for the short term, and i'm not trying to get rich quick. I'm willing to take my time and get rich slow but right. Any advice will help.
Jacksonville Beach Fl Real Estate
I'm 20 years old, with about $60,000 in capital. I' tired of working for these jobs. I want to start my own company and i love real estate. I'm not in it for the short term, and i'm not trying to get rich quick. I'm willing to take my time and get rich slow but right. Any advice will help.
Jacksonville Beach Fl Real Estate
2 Responses
West Los Angeles Homes
Your 60k can go towards purchasing an income producing property. In NY where I’m from 60k maybe able to buy one or two-family houses (put down payments & closing costs, two is stretching). They range from 400k+, if you can put down 5% and have the buyer pay your closing costs and roll it into the mortgage (seller concession) you might be able to buy two homes. The problem is that the smaller the downpayment the larger your mortgage payment. I personally would put down as much as you can on one property, rent it out and if you see another property you purchase the property using the equity you have on the first and keep repeating the process. My friends brother owns 4 homes (1 in NY and 3 outside of NY) which he rents out. Once the mortgage is paid off on all the properties then he will sell and pocket all the $$$ with a small amount of capital coming out of his pocket.
West Los Angeles homes
I am a fellow real estate investor. Perhaps I can help.
It’s great you are not looking for a short term, get rich quick scheme. Building wealth through real estate is a long term, systematic process.
The real question you need to ask is how to “leverage” the amount of money you have rather than “how to use” the money you have.
My wife and I are avid investors in real estate. We own two investment companies have closed 6 deals in last year alone. One we live in-we did not come out of pocket. One we bought outright and it has since tripled in value and 4 we bought using no money down strategies and all of them are cash flowing.
I would say, first get an entity structure in place. You need to start some business entities and be strategic about which states you select to start them in. Decide whcih type, (LLC, C Corp, S Corp, etc). Spend some money getting them properly set up so they can be seasoning. Once seasoned, corp credit will be available and you will need less of your own money and can use more of other peoples’.
While that’s happening, spend some money educating yourself as far as real estate goes. I can make some reccomendations of great teachers/books, etc.
Then start looking for deals. The only money you should be willing to spend of the $60k you have is to set the business up and education. Most deals can be done with little to no money down.
I hope this helps. There is so much that goes into it. I can’t write it all here. If you have specific questions-I would be more than happy to answer them.