Real estate investing isn’t just for the rich! You’ve probably heard the old saying “It takes money to make money.” Well, I tell you that a person with no money and no credit equipped with the right knowledge and knowing how can do this in the same way. This article covers how YOU can do it and what steps you need to take to make it happen.
Many people believe that you have to be rich to invest in real estate, like Hilton or Donald Trump. Or they think you need to save thousands of dollars for a down payment, like when you buy your house. Both thoughts couldn’t be further from the truth. You don’t need to save thousands or come from a rich family. All you need is the knowledge, people, and tools available to help you succeed.
There are things you must have in place when investing in real estate. We’ll cover those things and they’ll only cost you a little money, time, and possibly lunch.
EDUCATION GROUPS YOUR TEAM A MARKETING ACTION PLAN
EDUCATION: Now this “Poor Man’s Guide” isn’t going to suggest spending tens of thousands of dollars like you’re going to college, but keep in mind that education is the key. Sticking with the theme of this article, we understand that money is not a surplus, so we suggest you go to your local bookstore and pick up a real estate investing primer so you have a foundation to build on. Don’t assume you already know everything there is to know about real estate investing, but be willing to learn. The web is a source of knowledge and information from which you can gain insight and further your education on real estate investing. I STRONGLY suggest that a person spend a minimum of one year educating themselves before attempting a transaction. Cost: $50 (some books), 1 year (study time)
GROUPS: The groups cover many aspects but we were going to focus on two groups. Group One, the groups of people you are with in your daily life. These people are your family, friends, coworkers, and neighbors. Anyone within these groups who tells you “you won’t succeed investing in real estate” can kill your dream. I suggest not talking about investment dream killers. Get new friends to be around. People who will be positive, encouraging and supportive in your new quest to make a dramatic change in your life personally and financially. Group Two, groups like your local Real Estate Investors Association (REIA) or any local real estate investing group that you can work with, network with, learn from, and build the relationships necessary for your business succeed. Cost: friends (maybe), building relationships (time)
YOUR TEAM: To build your team you need to develop yourself and your social skills. There are many members of your team that will be needed to be truly successful and avoid many of the pitfalls along the way. Its value far outweighs the time and money spent (possibly lunch), rather than trying to go it alone. Starting your team should include but not be limited to.
1. A real estate agent (with experience working with investors): Real estate agents who have worked with investors understand what you are looking for and what you are trying to do. 2. Banker/Mortgage Broker (with experience working with investors): Build relationships so that in the future you can have a source of financing for your buyers. 3. Contractor/Handyman – can provide you with an estimated cost to repair properties. 4.Title Company (with experience working with investors) – They are familiar with creative deals and can help you with the best way to close a deal. 5.Attorney/legal advisor: preferably one who specializes in real estate law, ask them to review all documents that he will be using in your business. 6. Mentor – Learn and model yourself from someone who has been down this road before, your mentor can be a potential investor for you. Cost: time, lunch (maybe)
A PLAN: Your plan should be the foundation of your investment. Your plan should consist of the niche real estate you will be investing in and how you will achieve your goals. Write down your investment goals from small to large and the steps you plan to take to get there. Your mentor should be able to help you design an investment plan for you. cost: time
Marketing: As a “Poor Man’s” real estate investor, it is understood that you need to get the most out of your investment. So I will mention three marketing budgets to get you started, they will be the $100, $300 and FREE marketing budgets.
1. $100 Marketing Plan – for $50 you can order some bandit signs that say I/We Buy Houses with your phone number. In many cities these signs may be illegal, so I suggest spending $50 on a prepaid phone and including that number on bandit signs so authorities can’t trace them back to you. Go online to one of the many card companies where you can get 250 to 500 free business cards. If possible, get them in bright yellow, pink or orange by simply indicating I/We buy houses with their number again.
2. $300 Marketing Plan – This is the same as the $100 plan, but double the amount of bandit banners plus go to your local print shop and have them print you 1000 to 5000 1/4 size flyers page in those bright, attention-grabbing colors, again indicating that you buy houses. Place these flyers anywhere allowed.
3. FREE Marketing Plan – Best of all, visit an online business card site and order the business cards just like the $100 marketing. Place fictitious ads on online sites that allow ad posting and other similar sites to build your list of potential sellers and buyers. Network, network, network, let anyone and everyone know what you’re doing from your neighbors, hairdressers, friends, family, co-workers, bartenders, servers, and anyone who might feel they can use your services or put you in touch with someone who needs your services. Cost: $100, $300 or FREE
ACTION: This is the moment of truth and the most difficult for many who want to invest in real estate; taking action. I know and understand that when you get to this point you cringe, negative thoughts start to creep into your head (what if, what if, what if) and you need to stop them dead in their tracks. Take what you spent a year learning from books, online, your mentor, your team members, and your REIA group and put it into action, so you can see the potential in this business, and more importantly, the potential in yourself. When I do take action, many times I see new investors trying to make that BIG killer deal early on when they don’t even have a firm grip on how to make a deal. May I suggest you try to earn some money, not all the money at once? Yours and the old saying where I’m from……. A Fast Nickel Beats A Slow Dime.
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