I love the beginner real estate investor mindset because it’s open and untarnished by “You can’t do that here”, or “it’s never been done that way”, or “you need good credit for that”… and I wish I had had a forum like this one when I was a beginner investor. It was all gut feel back then sincere there was no one to turn to and no clubs… and I actually tReal Estate Investors Need to Know Before Buying hat’s best (the gut feeling after analysis)
If you know nothing (30% of My Cash Flow Academy students are right here):
First obviously figure out how much money you have to invest and what you qualify for in financing (leverage is KING). Figure out if you can get OPM to help to do a deal if you find one or are you on your own.
1)First, learn the lingo of investing: what’s an ROI, what’s plex what’s a multi-family versus a commercial building, etc. If you don’t know the lingo, people will use terms to intimidate you or cheat you.
2) Then learn the basics of how to finance each property type or investment type. And how you fit in, what you can get as far as financing. If you are new and not gainfully employed NO BIG DEAL, you can get private money. If you are W2 and qualify, then how much and at what terms.
3} Learn how to read financial statements of the different asset classes you are looking at . how to analyze a duplex’s financials versus the multifamily versus the self-storage. What’ normal versus not. You can do this by looking at listing on these multifamily commercial and storage units and see the trends. Practice on this. Then once you feel you have a basic understanding, then….
4) Get a mentor in the area you feel is your sweet spot. Every investor I have trained has an ah-ha moment where they go Ahhh I feel this, this is for me, or I get this… follow the thread. Even if it turns out you don’t like the asset class, it is NEVER WASTED TIME to learn to analyze. Ask, would I have bought this deal? You can find mentors like me, online or at real estate clubs, possibly. Vet them well by…
Vet the mentor: Ask a mentor for their tax returns, ask for their portfolio of properties or investments, so you know they are legit “Been there done that, and can you have the bank account or portfolio to prove it”. Any coach will share their “it” – it’s not a big deal. If it is a big deal, then they are hiding something like they don’t have any success or they are salespeople, no investors not “down to earth I want to help you” people.
These topics are some of the modules we teach over several hours at My Cash Flow Academy, so this is obviously the very short version, but I hope this helps.
I have 6 more items but not as important as these since you are a beginner.
Investing is a journey. It can go slow (20 years), or it can lightning fast (3 years) if you have the right guidance.
Cheers to your journey!