Most people have the misconception that in order to be a real estate investor sounds like an expensive venture costing thousands of dollars in initial investment. And in the past, it used to be, because of the traditional approaches to real estate investments. Many people believe that in order to be a real estate investor you must put down 20% of the purchase price and leverage your FICO scores in order to acquire, improve, and resell for a profit. That is the old school, way of thinking!
Fortunately, you don’t need six figures in the bank to be a real estate investor today. It really starts with a solid business system.
Many people who have reached financial independence have done so investing in real estate (in fact, it’s one of the most common ways to become a millionaire). This might seem like an impossible achievement if you’re only looking at the end result, but by starting out with small steps and making continued forward progress, you can make your way to “real estate investor in your local community for less than $1,000” even if you only have a smaller dollar amount to start investing with. There are strategies today that allow for new investors to acquire deeply discounted contracts and assign those contracts for big profit checks. Then leverage other alternative strategies allow aspiring investors to acquire rental properties that generate cash flow without ever own the subject property.
Today we will discuss how you can get started in real estate investing without breaking the bank, even if you you do have thousands of dollars stuck away and excellent credit. In today’s market, you can become a real estate investor without risking those dollars and your personal credit scores.
Why You Should Consider Real Estate Investing
The biggest reason you should consider real estate investing is because of the potential for higher returns compared to other asset classes (such as investing in the stock market). In fact, real estate has had an average annual return of 11.42% since 1970. To compare, the S&P500 had an average annual return of 10.31%.
Real estate investing offers leverage over assets, control over the assets, and a substantial profit, if done correctly. You can even invest in real estate while you are still in school or just starting your first career. Regardless of when you start, real estate investing is one of the many ways to grow your financial portfolio.
But it’s important to remember that comparing real estate to stocks is comparing apples to oranges. While there are some similarities, there are many differences that investors need to realize and understand as well.
Here’s what you need to do to get started.
1. Get Educated While Being Mentored Through Deals
There is a ton of free internet education available online. To really get a real estate investing business going you have to understand that you need to learn two distinct fundamentals, number one is the fundamentals of real estate investing, then strategies, coupled with how to operate a real estate investing business. Much like going to school and having access to a peer-to-peer coach. While it will be tempting to watch a TV show and be bombarded with the images of the expensive real estate investment seminar courses, they have a 97% fail rate between the course teachings and real-world student experience. The emerging trend is for people to become self-educated and mentored at the same time to learn the day to day ropes of operating a real estate investing business in their own market.
For those who are looking to get started as a real estate investor in your own market for less than $1000 in startup costs, these would be the real estate investing courses that we would recommend.
- “Fundamentals Courses”
- “Quick Flips”
- “Master Leases”
- “Cash Flow Mania”
- “AirBnb Cash Flow”
- “Profit Big From Property Taxes”
- “Alternative Leveraging”
- “Business Mentorship & Virtual Turnkey Business System powered by Rescue Team Properties®
Once you learn about the different types of options for the real estate listed above, you will want to think about the one that fits your budget, time, and requirements.
You will also want to learn how to properly evaluate a deal in order to make the best investment. You may not be familiar with the city or locality where you are investing, so you will definitely want to check out how to evaluate the locality or neighborhood you are investing in to make an informed decision, that is really where education and mentorship “know-how” to operate your own real estate investing business makes a huge difference.
2. Set Your Goals
After doing your homework, you will have a range of the initial investment you can expect to make in getting started. It’s possible to get started with just $1,000 (or even less in some circumstances). But you should also have a goal and know yourself.
How much risk do you want? How much work do you want to put in?
Write down your goal. Next, reverse-engineer what you need to do to get to that point – what is the initial investment amount required to get started?
3. Apply the No Money or Personal Credit Strategies
At some point, you are going to come to the realization that you have to put away your disposable income so that you can fund your real estate investing dreams. You can do so even if you earn a meager salary, or even if you are a starving college student. You can do this, and the important thing is to begin with the end goal in mind.
You can easily acquire deeply discounted property contracts with as little as $100 to $500 in earnest money and quickly by working on your side hustle to learn how to operate your virtually turnkey real estate investing business.
4. Explore Your Real Estate Investment Options on a Deal By Deal Basis.
It is important to understand that your level success as a new real estate investor will be not only in your educational experience but in working with your mentor who can show you the ropes on how to operate your new real estate investing business venture in your city.