How Do I Get Started Investing in Real Estate?

How Do I Get Started Investing in Real Estate?

By Christian Bryant

One of my favorite responsibilities as President of NWREIA & PAROA is mentoring real estate investors. Roughly 90% of my new clients are either people that I have helped for free in the past or people they refer.

I have helped hundreds of investors over the years and find new investors share similar questions or problems. There are three main hurdles that all investors must get over and in my experience the majority struggle with at least one of them. In my opinion, these hurdles are also the three most important skills of every real estate investor.

First is the ability to have a conversation and be likeable.  An investor’s net worth is directly related to their network. Growing up I was an introvert. I was the kid who was friends with everyone in school but never outgoing, stood on the sidelines during dances, and was ultimately happiest alone with my thoughts. It was simply what made me feel comfortable. When I got into sales about ten years ago I realized that I had a problem. My natural state in a room full of professionals that I don’t know is to be quiet and just get through it. To be successful, though, I needed to learn how to “work a room” and have a pleasant conversation with complete strangers.

At first I took to reading a few books on how to be personable. Many of those books are very good reads and worth the investment. It finally “clicked” in my brain when I realized that the key is to relax, focus on the other person and listen. Without getting personal you ask about their work, their family, their goals, etc. Then sit back and truly listen to what they are saying. Fight the urge to interrupt and respond thoughtfully. The only thing that you should have running in the background of your mind during the conversation is trying to figure out how you could help them. Then it just comes down to the basics, being respectful and remembering your manners.

The second hurdle that new investors struggle with is simply getting started. Let’s face it, committing to your first deal is nerve wracking. You could lose all your money. You could go into massive debt. You could get sued or taken advantage of. At some point, you must take an educated leap into that first deal. Most people that talk about getting into real estate investing continue talking about it their whole life. The first question to ask yourself is, what happens if you never even try? Maybe you’re financially safe, but how many life goals will you be giving up on? How many years will you be adding to your retirement age? To me these thoughts are much more terrifying than the thought of failure or debt.

Remember that I said take an “educated” leap. Real estate investing is a risky business and much can go wrong. Do not skip your research and due diligence prior to committing to a deal. There will be a point, though, where you must take that leap. Trust in your analysis, education, and the advice that you received from your mentors.

The third hurdle is what I contend is the only major difference between the 5% who make a sizable living and those who struggle. That is the realization that this is not a hobby! Here’s a little tough love for you: either fully commit to making this happen or move on. When you are an investor you must treat it like a real job. The dream is of course to be able to work 10-20 hours a week on your portfolio, but that typically only happens after years of hard work. In the beginning, you need to commit as much free time as possible. The amount of time obviously varies for each person. but whether it’s five or 80 hours a week, keep moving forward. Eliminate time-wasting activities and fill that time with self-education, attending networking events, real estate investing classes, and searching for or analyzing your next potential deal.

If you feel ready to tackle these three hurdles the next step is deciding what your first investment will be. Typically, your financial situation will determine this. If you have some money to invest then you of course have more options. I suggest picking something that you are interested in and focus on that as your first. If money is tight or non-existent then you may want to consider starting with something like lease option deals, which don’t require a cash investment and won’t rely on your credit. There really is a first deal for every level of investor, which means there’s no excuse to hold back.

Get out there and get started! What are you waiting for?

If you need help finding or analyzing your next deal, let’s schedule a meeting.

Christian Bryant is President of IRC Real Estate & Property Management

www.IRCEnterprises.com

[email protected]

Add your reaction Share

How Long Does it Take to Build a Single-Family Home?

The NAHB’s Eye on Housing recently took a hard look at building data from the U.S. Census Bureau and found that the average completion time of a single-family house is around 7.5 months – which normally includes about a month from authorization to start and then another 6.5 months to finish.  They found that the average completion time in 2017 was the same as it was in 2016, however it was slightly more than in 2015.

“The time from authorization to completion varies across the nation and depends on the geographic location, metropolitan status, and whether the house is built for sale or custom-built. According to the 2017 SOC, it takes anywhere from less than a month to 77 months to build a single-family home from obtaining a permit to completion.”

Click here to read the full story at the NAHB’s Eye on Housing.

Add your reaction Share

Demographics Driving Single-Family Demand

The folks over at Arbor remind us that the average suburban home with a yard and a two-car garage may not be the first image that the word “rental” brings to mind, but single-family homes have quickly become one of the most sought-after rental sectors on the market. To that end, they put together this handy infographic that takes a look at the demographic factors that are contributing to a surge in single-family home rentals.  Happy Friday!!!

Hat tip to Arbor.

Add your reaction Share

Foreclosure Rate on Recent FHA Homes Sees Jump

BY  ON JULY 16, 2018

While foreclosure starts are decreasing across the nation, they actually increased in 40% of local markets, according to ATTOM Data Solutions’ Midyear 2018 U.S. Foreclosure Market Report.  There were 362,275 U.S. properties with foreclosure filings (including default notices, scheduled auctions or bank repossessions) in the first six months of 2018.  This figure is 15% lower than one year ago and down 78%  from a peak of 1,654,634 in the first six months of 2010.  Interestingly, recent FHA loans (originating in 2014-15) have seen above average increases in foreclosure rates.

“Localized foreclosure flare-ups in the first half of 2018 can no longer be blamed on legacy distress left over from the last housing bubble given that nearly half of all active foreclosures are now tied to loans originated in 2009 or later…Instead these local foreclosure increases are typically the result of more recent distress triggers in those markets.”

“We’re also seeing early evidence of gradually loosening lending standards starting in 2014, specifically for FHA-backed loans….The foreclosure rate on FHA loans originated in 2014 and 2015 has now jumped above the average FHA foreclosure rate for all loan vintages — the only two post-recession vintages with foreclosure rates above that overall average.”  Said Daren Blomquist, senior vice president with ATTOM Data Solutions.

click on the map to make it interactive

Click here to read the full story at ATTOMdata.com.

Add your reaction Share

Fastest Growing Suburbs in America

Where are America’s fastest growing suburbs?  That’s the question Realtor.com recently put pen to paper to in order to determine the hottest bedroom communities all across the country.  To get their list, they analyzed over 7k zip codes, focusing on the ones outside a city’s limits and within an hour’s commute in rush hour to the center of the nearest urban area. They calculated home appreciation over the last three years, the increase in the number of home listings, population growth and factored in the share of new construction at the county level.

“These  [are places that]  have what people want. They aren’t right in the city, and they aren’t too far out, where commute times are long.”

The top 10 fastest growing suburbs are:

  1. Apex, NC
  2. Ponte Vedra Beach, FL
  3. Frisco, TX
  4. Scottdale, GA
  5. Lakewood Ranch, FL
  6. Arabi, LA
  7. Manor, TX
  8. Aurora, CO
  9. Waukee, IA
  10. Nolensville, TN

Click here to read the full report on Realtor.com.

 

Add your reaction Share

Rise of the Older, Single Female Home Buyer

More and more older single women are purchasing homes at an increasing clip.  This interesting aspect of potential homebuyers was recently reported by the Wall Street Journal and reposted by Realtor.com.  Interestingly, the article points out census data showing that, since 1981, single women over 55 have been the fastest-growing demographic of home buyers when compared with several other categories.  In 2017, single, older women made up 8.2% of all home buyers, which is nearly double the percentage 20 years ago.  Furthermore, these women are buying homes at nearly 2x the rate as their male counterparts.

“There have long been many more older single women than men, reflecting the fact that men remarry at a higher rate after a divorce, as well as the fact that men generally die at younger ages. But the dramatic increase in home purchasing by older women speaks to something else. Many women in this place in life want to own a home of their own, says Jessica Lautz, director of demographics and behavioral insight for the National Association of Realtors.”

Click here to read the full story on Realtor.com.

Click here to read the full story at the Wall Street Journal.

Add your reaction Share

29 Real Estate Sub-Markets Markets to Watch

Online real estate marketplace Roofstock recently released a list of the 29 real estate submarkets to watch, based on data from their nationwide collection of property managers.   Their list includes six major areas’ submarkets and it is probably worth a look – especially if you’re seeking new markets in which to invest.  They also say they will continue adding to this list.  Indeed….Do your due diligence, gather good intelligence and you’ll be on the right path.

“Getting your foot in the right real estate market at the right time can feel a bit like throwing darts blindfolded. While housing demand in hot areas like Nashville, Denver, Seattle and Dallas continues to blow up, there’s plenty of other bandwagons to get on if you know where to look.”

The key areas identified by Roofstock are:

 

Click here to read the full story on roofstock.com.

Add your reaction Share

Best & Worst Cities for Recreation in America

The recreational aspects of any given area can be a main driver in determining where to live – and we all know how a nice, clean park adds value to any neighborhood.  Recently, the folks over at WalletHub looked at the 100 largest U.S. cities to determine the best and worst cities for recreational activities.  They looked at metrics such as cost of living, the quality of parks, the accessibility of entertainment & recreational facilities and of course, the climate.  Be sure to click on the interactive map below.

Here are their top 10 cities:

  1. Orlando, FL
  2. Las Vegas, NV
  3. San Diego, CA
  4. Cincinnati, OH
  5. Tampa, FL
  6. Atlanta, GA
  7. Scottsdale, AZ
  8. Tuscon, AZ
  9. Boise, ID
  10. Philadelphia, PA

 

Click here to read the full story on Wallethub.com.

Add your reaction Share

Yardi Says Apartment Rents at All-Time High in June

According to the latest Yardi Matrix, U.S. multifamily rents rose $12 in June to $1,405 – which they report is an all-time high.  Year-over-year in June, rents were up 2.9%, a 20-basis-point increase over the previous month.  Yardi says the strong performance is a good sign that demand generally is holding up and that robust supply growth is not an impediment to rent growth in most markets.

“The resilient U.S. multifamily market demonstrated its strength and consistency in the first half of 2018. Despite headwinds presented by consistent supply growth and lack of affordability in many major metros, rents continue to grow steadily. Average U.S. rents increased by $29 in the second quarter, up 2.1% for the quarter, 2.6% for the first half and 2.9% year-over-year.”

Click here to read the full report on Yardi.com.

Add your reaction Share

New Single-Family Home Size Increases

Reversing a trend over the past couple years, the sizes of new single-family homes have been increasing since the start of 2018. The NAHB’s Eye on Housing recently dug into data from the U.S. Census Bureau to show that the median single-family square floor area increased to 2,436 square feet and the average (mean) square footage increased to 2,641 square feet.  It’s also been reported Americans are physically getting larger/fatter…..coincidence???

Click here to read the full story on the NAHB’s Eye on Housing.

 

Add your reaction Share