Most Common Questions I Get About Real Estate Investing

Most Common Questions I Get About Real Estate Investing

what’s going on everybody so in today’s
video I’m gonna be going over the top ten most frequently asked questions I
get for becoming a real estate investor if you’re a new real estate investor
looking to get into the business I’ve talked with probably thousands of
students but in the business about ten years in this video I basically compiled
a list of the top ten most frequently asked questions I get so hopefully I’ll
be able to answer all your questions about real estate investing and if you
have any additional questions just drop them in the comment box below and I’ll
be sure to answer them so question number one I get all the time about real
estate investing is do you need a real estate license and the quick answer is
no you don’t need a license whatsoever when I first got started I didn’t have a
license you can easily invest flip wholesale rehab buy rental properties
without a license now that being said I think having a license actually gives
you a competitive advantage because you’ll be able to see comps on the MLS a
lot of times if you’re looking at comps and like Zillow or red fin then they can
be pretty accurate and pretty helpful but they’re not gonna give you the exact
like tax records photos missions you know there’s much more data on MLS so I
recommend getting your license don’t let that stop you from investing in real
estate but I recommend getting your license also because you pay like a
couple hundred bucks and it’s probably one of the easiest tests you will ever
take I mean I think I studied for a couple weekends and then passed it so I
definitely don’t let it stop you but I would I would recommend getting okay the
next question I get all the time is do I need money to invest in real estate in
the traditional auto world let’s say you’re buying rental properties
obviously you would need money for a down payment you can always borrow it
but if you’re just flipping and wholesale which is the number one
strategy I’d recommend when you’re first getting started you don’t need money at
all I mean you might need like fifty bucks a hundred bucks just to buy some
marketing materials like Direct Mail maybe banna sighs maybe door hangers
maybe do some online ads I literally had maybe a couple thousand bucks but you
know obviously I’m not using that as a down payment for a house and the first
couple problems I did were around like three or four hundred thousand dollars
you definitely do not need money to start flipping the way flipping without
money works is you basically just through a lot of marketing to find
motivated sellers and then just sell the rights of that contract to a cash buyer
and in any market there’s actually more cash than you would believe the hardest
part about deals is actually finding the deal not necessarily finding the money
for it because what you realize is that the money is actually everywhere the
real skill set is actually finding the deal which brings me to my next question
and I get all the time from students across the country so how do you find
deals everybody their markets like super competitive and
there’s no more deals right there’s a lot of actually proven strategies to
finding deals in any mark some of these proven ways and I have other videos that
go more in-depth on these but they ended signs we buy houses signs those really
ugly signs that you see that’s actually a proven way of finding deals and I knew
always have to be careful with regulations and things like that to me
you’d want to get fine putting them up if you put them up in a County that
doesn’t allow it but that would be one strategy a couple more strategies would
be direct mail that’s actually my favorite strategy that’s how I find
deals all the time sending direct mail to motivated sellers so motivated
sellers being like absentee oh and pre foreclosures your probate eviction tax
liens things like that that’s just a proven strategy of finding deals and I
basically do deals in three states around my metro area but if I was to go
to Alaska or Hawaii and I actually knew a house flipper in Hawaii if I was
actually to go to one of those places I’d probably do the same exact I would
do direct mail to motivated sellers it would probably work there probably be
slight differences here and there but for the most part send out a lot of mail
to the right people get a certain amount of leads and a certain amount leaves are
gonna be very goodly and those are the deals you put under contract and
actually if you want to copy of my direct mail piece just drop a comment
below and I can shoot you an email with the exact direct mail piece that I use a
couple other ways of finding deals on Network e so and I mean like strategic
networking because a lot of people don’t go to like one meetup group and they’ll
say oh yeah I’ve been networking and that’s not really networking that’s
going to like one event so by networking I mean like building a list of every
single real estate agent it may be reaching out to all of them saying
you’re looking for deals or doing the same with wholesalers like when you see
abandon signs as we buy houses maybe write that number down and then
eventually you have like 20 of those numbers and then maybe you also look at
LinkedIn for like real estate investors and then you reach out to those people
and say hey if you have any deals let me know maybe you take people to coffee
maybe you said I go into one meetup group you go to like three meetup groups
then you also go to area groups which is real estate investor Association groups
and then you also go to other networking events across the city when you take
like a really mass action type approach that’s when you start to see deals if
you just go to like one meetup group or send out one group of letters like
you’re probably not gonna get any deals though okay the next question I get all
the time is my market to competitive and doesn’t work in my market this is like
everybody thinks of their market no matter if they live in like Oklahoma
Alaska wherever they live they always think their market is the most
competitive which is kind of funny but yeah every market is competitive every
is competitive you were a dentist you know every city probably has 20 other
dentists if you’re a real estate agent every city probably has a thousand
realtor whatever business you are it’s not like there’s a city that just
doesn’t have anybody I mean there’s definitely more or less competitive
cities you shouldn’t let that stop you if you took the top investor in any city
and you put them in a different city I could almost guarantee you they would
probably be doing the same amount of deals and making a similar amount of
money just because they learned you know a proven way of finding deals whether
there’s strategies Direct Mail maybe it’s networking maybe it’s online
marketing but you just need to learn the skill set of getting leads and doing
deals and then you can really apply to any city and there’s actually a really
good Jim Rome quote not to sound too cheesy here but don’t wish it was easier
wish you were better so the way I took that cuz I’m in a pretty competitive
market myself and so instead of saying oh this market is too competitive I’m
gonna go to like I’m just gonna try to find the least competitive market I said
you know what I’m just gonna improve my marketing skills and do more networking
and just really sharpen my marketing skill so that I can find deals no matter
how competitive people might think it is okay the next question I get all the
time is should I invest in a real estate course or real estate program because
you see a lot on TV on the radio online you might see different people offering
like mentorship programs and like pretty expensive real estate coaching programs
I spend five figures over five figures when I was first getting started on a
real estate investing course now most people would think that’s crazy most
people say that’s a complete waste of money but the way I see it is like look
if there is someone that has done something successfully is still doing it
successfully and they’re offering to teach you exactly how to do that I think
you’d be crazy not to pay for it I mean from my standpoint I wanted every
possible advantage going for me so the way I see a real estate investing course
look you absolutely don’t need one there’s plenty of investors nationwide
that are successful that probably never did a real estate investing course they
just figured it out by themselves which is totally totally cool you can do that
however if you want a faster path to becoming successful I would recommend
going with the real estate investing course because just the fact that you’re
paying money for something that’s gonna make you work a lot harder even if you
just learned one thing it’s gonna make you that much it’s gonna make you
slightly better give you a slight advantage over your competition okay the
next question I get all the time is uh is how smoking illegal is real estate
investing illegal now house hoping did get a really bad name because of all the
nonsense that was going on around like 2005-2006
2007 2008 there was a lot of fraud and different things like that going on but
in itself how something is not illegal you have this in every business you buy
an asset lo fix it up and you sell for a high price there’s like a wholesale and
retail price in every industry every business since the beginning of time
finding good deals and then selling them at market price or bringing them up to
market price there’s absolutely nothing illegal about that now obviously I’m not
a lawyer so I don’t want to give you any type of legal advice there’s a legal
ways of doing anything if you’re doing something sketchy or fraudulently
flipping houses and there’s probably a million ways to do that the same way
there’s a million ways of doing anything illegal then yes but if you’re just
buying an asset low and so on and high there’s absolutely nothing illegal about
that okay the next one I get all the time is how long does it take to get
paid on a real estate deal they’re usually referring to how something so
there’s there’s basically two types of house something there’s wholesaling or
you’re basically just selling the rights of the contract to a cash buyer and in
those cases I think my fastest deal that ever got paid was maybe about two weeks
I think actually maybe ten days but most wholesale deals I’d say were taking
about thirty days from start to finish that’s that’s usually what I like to put
in my contracts now as far as where you have schoo you can make a lot more I
mean you can make six figures not you know it’s all it’s not typical but you
theoretically could make six figures on a rehab deal I’ve done that before
but that takes you know more like at least three months to get that type of
deal done and if you want to be on the safe side if you’re a new real estate
investor I would say plan on more like six to twelve months six months is is
usually a good time frame a lot of hard money lenders when they lend you money
they’ll usually do it on like six-month time frames okay the next question I get
all the time is what neighborhood should I invest in and this is kind of a
trickier question so it just it depends and what I mean by that if you’re doing
short-term house will be and like I do short-term house looking to do some
long-term stuff but in short term houses mean I could care less what neighborhood
and the reason being is I’m just looking for salt comps let’s say I’m in a bad
neighborhood properties only cost like twenty thousand or someone someone says
look you can buy this house of twenty thousand dollars which is like insanely
cheap I’ll say okay yeah that might sound like a good deal but I just I need
to see comps at like let’s say a hundred fifty thousand that sell for renovated
so I’m not just gonna buy a property just because it’s cheap I just need to
see renovated cops it’s as simple as that it’s as simple as okay one
neighborhood maybe houses sell for a million dollars which means you probably
have to purchase the property like six or seven hundred thousand and then the
same is like if I’m in a neighborhood where properties only sell for
$200,000 I would just have to purchase it at like 40 or 50,000 – to the point
where it makes sense for me to do a deal so in there’s different factors yeah if
I’m in a quote/unquote bad neighborhood yeah I might factor in a little bit more
whole time it’s all a numbers game so I use my deal analyzer and if I say wow it
can make 50,000 or 100,000 60,000 in a quote-unquote bad neighborhood yeah of
course I’m gonna do it I’m not gonna be like not do it just cuz it’s not my
favorite neighborhood yeah I mean I would obviously prefer to do
million-dollar neighborhoods all the time but I’ll take a good deal wherever
a good deal is and actually wanted to add something on to that so if you’re
buying rental properties that the neighborhood in my opinion will matter a
little bit more so in some areas there might not be as good of appreciation as
in other areas so that is something to take you to account you know if I’m
purchasing a rental property you know you got to think of the cash flow but
you also have to think of future potential appreciation so you know you
try to find those transitional neighborhoods that are kind of on the
up-and-up usually you’re not going to be purchasing a rental property in a
million-dollar neighborhood because it’s just it’s not gonna make sense to
purchase a property for let’s say a million dollars and then you just rent
it out for like 4,000 and you’re barely covering the mortgage if at all so you
oftentimes want more of like the blue-collar type areas where you can get
a house at a low enough price and we’re so covers a mortgage and so it gives you
a couple hundred bucks or ideally more than that per month in cash flow next
question I get all the time is does the economy matter when it comes to real
estate investing and I was saying this in terms of short-term flipping the
economy doesn’t matter whatsoever people like ask me like where do you
think the economy’s going you know interest rates are going up this and
that’s happening and my response is like look I really just don’t care I mean I
care a little bit I don’t want to completely just make it a non-factor but
if you’re buying properties on a short-term flip basis you’re only
holding on to them for like 30 days or maximum six months and you’re not when
you’re buying houses you’re not depending on the property to go up in
appreciation and when you buy properties right you also built in enough
forgiveness so if the economy did go down a little bit you would still be
protected and if you want the actual deal analyzer that I use you know on a
day to day basis just drop me a comment below with your email address I’ll send
it over to you okay the next question is is real estate investing risky
yes I think like any investment it can be risky the way I mitigate rescue my
own business you know obviously the first thing is I try to educate myself
as much as possible I got a mentor I go to seminars I read books I try to talk
to as many people I try to get insights from as many people as possible so that
that helps to have somewhat of a buffer right there against risk and then the
second thing I do is I just do enough marketing to the point where I just get
really good deals that are undervalued so if you purchase house at let’s say
two hundred thousand and it’s worth like four hundred fifty thousand there’s
gonna have to be a lot that goes wrong for you to lose money on that type of
deal so that’s how I mitigate risk in my business I just do so much Marquis where
every possible thing could go wrong and I would still make money and believe me
that’s actually happened on ideal or two before so that’s where you want it
that’s how you mitigate risk is by educating yourself I looking at so many
deals to do so much marketing getting so many good deal opportunities that you
just cherry-pick the best ones and you find deals that just don’t have a lot of
risk even if they need a ton of work you can just like basically realist him and
adds its condition if you need to all right and just to wrap this video up the
last question do I need an experience to get started in real estate investing and
absolutely no you do not need experience I had zero experience coming into the
real estate world I was a political science major in college just because I
wanted to graduate on time and I started doing real estate like I said my whole
thing was just finding deals so I got started by just look doing a lot of
marketing finding good potential leads and then sending them over to some of
the top investors in my area and after doing a couple of those I gained enough
experience to the point where I said look if I get one that’s really really
good I might just want to purchase that myself so then it’s starting to become a
combination of look look I’ll still send over good deals to investors but I’m
also gonna be purchasing these myself if I come across a good one and I think
that’s the best strategy honestly because in any market there’s always
people that are willing to pay like insane prices for investment deals so
you should always have that in your back pocket but then if you come across like
an amazing deal I think you should also consider purchasing it as well okay so
hope you enjoyed this video on the top 10 questions I get from real estate
investors and about real estate investing hopefully you got a lot of
value out of this video please subscribe please like please share and if you have
any questions just drop them in the comment section below
talk to you later bye

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