Author Topic: Where to begin with a Rental Property?  (Read 3973 times)

newguy

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Where to begin with a Rental Property?
« on: January 15, 2014, 10:57:26 AM »
I am interested in learning more about how rental priories work. Does anyone here have any place for a beginner to start the research process?  Is there benefit to joining an online group where investors each join a minimal amount of money to collectively make a large join investment or is that too risky/potential scam?   Any personal information or links are welcomed. 

arebelspy

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Re: Where to begin with a Rental Property?
« Reply #1 on: January 15, 2014, 11:20:13 AM »
I am interested in learning more about how rental priories work. Does anyone here have any place for a beginner to start the research process?  Is there benefit to joining an online group where investors each join a minimal amount of money to collectively make a large join investment or is that too risky/potential scam?   Any personal information or links are welcomed.

I'd start with reading some basic beginner books.

There's a list of recommended books here: http://www.mrmoneymustache.com/forum/real-estate-and-landlording/real-estate-book-recommendations/

Start lurking on BiggerPockets.com forums and reading their posts.  Then start asking questions over there and here.

Is there benefit to joining an online group where investors each join a minimal amount of money to collectively make a large join investment or is that too risky/potential scam?

I'd stay far away from those.  Most will be shady/scams, and you won't know enough to tell the difference for awhile.

Start by educating yourself.

Hope that helps!  :)
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
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newguy

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Re: Where to begin with a Rental Property?
« Reply #2 on: January 15, 2014, 12:36:06 PM »
I am interested in learning more about how rental priories work. Does anyone here have any place for a beginner to start the research process?  Is there benefit to joining an online group where investors each join a minimal amount of money to collectively make a large join investment or is that too risky/potential scam?   Any personal information or links are welcomed.

I'd start with reading some basic beginner books.

There's a list of recommended books here: http://www.mrmoneymustache.com/forum/real-estate-and-landlording/real-estate-book-recommendations/

Start lurking on BiggerPockets.com forums and reading their posts.  Then start asking questions over there and here.

Is there benefit to joining an online group where investors each join a minimal amount of money to collectively make a large join investment or is that too risky/potential scam?

I'd stay far away from those.  Most will be shady/scams, and you won't know enough to tell the difference for awhile.

Start by educating yourself.

Hope that helps!  :)

thank you, I will get started on my education with this help you have provided.

_JT

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Re: Where to begin with a Rental Property?
« Reply #3 on: January 15, 2014, 01:02:38 PM »
Start with the beginner's guide to real estate over on biggerpockets.com. It's free, and a quick read. After that you'll start to get some idea of exactly how much there is to learn.

arebelspy

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Re: Where to begin with a Rental Property?
« Reply #4 on: January 15, 2014, 01:19:41 PM »
Start with the beginner's guide to real estate over on biggerpockets.com. It's free, and a quick read. After that you'll start to get some idea of exactly how much there is to learn.

Ironically I feel the BP beginner's guide is better suited for intermediate investors, and wouldn't personally start there, but it does have some good info for sure!
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.

_JT

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Re: Where to begin with a Rental Property?
« Reply #5 on: January 15, 2014, 04:56:36 PM »
Ha, that's kinda funny. BP: The Beginner's Guide: For Intermediate Level Investors. I'm a little hazy on it, but you may well be right.

Blindsquirrel

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Re: Where to begin with a Rental Property?
« Reply #6 on: January 18, 2014, 08:26:08 AM »
   Your local area may have a real estate investors association. They can be useful. You do NOT need to attend anyone's magic seminar on no money down or buy anyone's set of DVDs or manuals to instant real estate riches. The real estate section of this forum has some very good advice.

CaptainCalf

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Re: Where to begin with a Rental Property?
« Reply #7 on: January 21, 2014, 12:43:15 PM »
Read, read and read some more about real estate investing.  That way you'll not only educate yourself but you'll also gain the confidence you'll need to jump in one day.

Also, I suggest that you consider your time and priorities, such as are you willing to do the renos/clean ups yourself and will you do the management/maintenance yourself or would you prefer to have it managed professionally at a cost of about 10%/month?  Personally, my regular job fills most of my time, so I have a great realtor who also operates a management company that handle all my units.  It's not the cheapest way to do it, but if you do your analyses including those costs you can still manage to produce positive cash flow.

Additionally, if you know excel or have another number crunching program go through the analysis for each property that interests you.  I use a spreadsheet to analyze every unit before deciding to make an offer on it or not. Personally, I like a good monthly positive cash flow and equity right up front.  The positive cash flow will mostly depend on your PITI vs rents and the beginning equity can be attained by buying under the appraised value.  That's not always possible, but it's something to shoot for...

Currently, the mkt is trying to go back up and there are fewer and fewer deals out there, but if you search hard and have located a good realtor you just may find a short sale that fits the bill.  If it doesn't make sense on your spreadsheet analysis then stay away...

Good luck and don't get discouraged cuz it took me years of analyses to finally find something that worked.  I started looking in 2006 and bought my first unit in 2010.  While others were short selling I was buying.  It's kinda a contrary popular views, but I say buy when others sell and then don't sell when others are buying instead just sit back and watch your equity rise with the mkt! 

Blindsquirrel

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Re: Where to begin with a Rental Property?
« Reply #8 on: January 21, 2014, 05:40:39 PM »
   a rental very close to your home or commute path is not a bad thing to consider also.

CaptainCalf

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Re: Where to begin with a Rental Property?
« Reply #9 on: January 22, 2014, 08:14:27 AM »
   a rental very close to your home or commute path is not a bad thing to consider also.
+1, we have bought a number of units right in our own neighborhood for a couple of reasons.  One is we know the area like the back of our hand so we know the schools are all A rated and it's a breeze to pop over to supervise or actually do some of the work needed to ready a unit for a tenant...