Of course you want to get started, but you just don’t know how yet. The big thing to consider first is whether you are a high performer or not. Read this post to find out. If you are, then continue reading. If not, then go back to Netflix and mediocrity. I won’t judge – it’s not for everyone.
Getting started often means one doesn’t have a lot already. If you have been working and saving a bunch of cash, then I’m impressed. In that case, you should turn to my course on real estate investing for high-performers. That being said, you might be a high-performer but are just starting out and don’t have much cash. That’s OK!
How to Get Started Without Much Cash
Step #1. Let me first say – if you have exactly $0 dollars saved up, then you need to start by setting a budget and saving at least 10% of every bit of income you have into a real estate investment account and never touch it until you make a purchase. Do this until you have at least $20,000 saved. There are a thousand people on the internet who will tell you how to start with no money at all, and it can be done, but it’ll take huge work and that effort could be better put to building a habit of saving money.
Now that you’ve got a head on your shoulders about it, let’s go on to Step #2: Learn. It’s always read and learn with me, I know. This is cheap. Here are your books. Read them in this order.
- Rich Dad Poor Dad by Robert Kiyosaki
- The Millionaire Real Estate Investor by Gary Keller
- The House Hacking Strategy by Craig Curelop
- Never Split the Difference by Chris Voss
There are plenty more good books out there, but these are the essentials for what you are about to do.
Step #3: House hack. Start looking for quad plexes in your area. This’ll narrow your search and make it easier to focus. Talk to a residential banker and get an FHA loan preapproval. This will help you to know how much money you can pay based on what you have saved up. Look for a fixer-upper, though it has to be livable right away. Talk to a real estate agent and explain your criteria and stay focused on it. Continue reading and learning while the search is going on. Don’t want to use an agent? Save the DIY for later. This first one, get all the help you can.
Step #4. Build equity. Live in one unit while the other three are rented and paying off your mortgage. Every extra dollar it makes needs to go back into your investment account, getting ready for the next one. When you see how you can make money through this equity you will be amazed. Your next purchase will go so much more quickly and you’ll love it!.
Step #5. Expand. Your next step will be a year later, when you can purchase your next quad plex in the same way. Talk to your banker about how to do this. After that, you’ll move to purchasing an 8 plex that you don’t live in. Then move up to bigger ones about one every 1 or 2 years. Before you know it, you’ll have amassed enough to retire. But you won’t want to yet.
Through all this, it’s helpful to keep your W2 job as long as you can. Believe me, do these things and you’ll be set. Everything is easy after that first one.
