Real Estate Investing: 7-Day Challenge
Have you ever thought about getting into real estate investing yourself? Why wait?! Join us on a 7-day challenge of how you can get started in real estate today! Every day for the following week, we will give you an easy step to get you started on your journey to financial freedom!
Day 1: Watch motivational video on real estate
For the challenge today, watch the video above to hear Bryndee walk you through a few different types of real estate investing. There are so many ways you can invest in real estate, it’s no one size fits all. We want to get your wheels churning on what kind of real estate investing is right for you!
Day 2: Order a book about real estate
Continually learning is the key to success. For Day 2’s challenge, we want you to order a book about real estate investing. In order to start investing in real estate, it’s best to learn what you are doing before you jump in. We are talking about large dollar amounts here, so you want to know what you are doing! Here are 3 of our favorite books on Amazon that we recommend new investors read. Order one of the books below or another one that’s been on your book list. The point is it to take your first step in learning or expanding your knowledge--even if you already have experience in the industry.
Day 3: Join your local REIA or find the date of next meeting
It’s Day 3 in our #RealEstateChallenge! If you haven’t done any of the other challenges yet, well, third time's a charm! Today’s challenge is to join a local real estate investing group and mark the date of the next meeting in your calendar. Easy enough, right?
Networking is essential to success in real estate! Not only do you learn from meeting other people, but you can’t buy or sell a house without them. You work with a minimum of five people to just complete one real estate transaction--think: realtors, lenders, property managers, contractors, buyers, sellers, and title companies just to name a few! The best place to start networking is in local investor groups and meetups. There are lots out there! In fact, if you are local to Utah, Kyle hosts a free monthly meeting with Salt Lake City Real Estate Investment Group.
However, the number 1 organization we recommend to all investors is REIA (Real Estate Investors Association). REIA is a nationwide networking group that provides outstanding resources for education and meeting others. Did you know we moved 7 times across 4 states in the first 5 years of our marriage? And guess what, in every one of those states and cities we were able to find and join our local REIA chapter.
To find your local REIA, go to http://www.nationalreia.org, and click “Find a Local Group.” From there, you can search the chapter nearest you. Go to your local chapters website and register to become a member. Or if you aren’t quite ready to commit, most states offer the first meeting for free, so look at their events calendar and mark down their next meeting. Put it in your calendar, on your phone, or on your fridge so you remember to attend the next time they have a meeting.
Day 4: Look up five potential rental properties
Day 4 in our #RealEstateChallenge is all about getting your hands dirty on some real properties. Today’s challenge is to look up 3 potential RENTAL investment properties and run some numbers on at least one.
There are many ways we get information on properties. Our number one source is realtors. If you don’t have any contacts with an agent yet, use Zillow or another real estate site to browse properties. Or if you are looking for an agent, DM us and we can refer you to our favorites if you are in Utah, Minnesota, Florida, or Wisconsin!
Here is your homework today:
Ask a realtor to send you the top 3 rental properties they recommend that are currently for sale (or find them yourself on Zillow)
Look through the 3 properties and get a feel for typical purchase price, rental prices, and types of rental properties in your city.
Take your favorite property of those five and thoroughly analyze it to determine how much profit it will bring in each month if you were to purchase it.
If you don’t have an analyzer or you don’t know how to calculate any of the numbers, there are lots of resources online or we offer both rental and flip analyzers and instructional videos you can purchase here. We use these analyzers everyday to calculate whether a property will be profitable or not and determine which ones to purchase.
Day 5: Look up five potential investment properties to flip
Welcome to Day 5 in our #RealEstateChallenge. Today’s challenge is very similar to Day 4, but this time we want you to find properties to flip. Ask your new realtor friend to send you 3 potential FLIP projects and analyze at least one to determine the profits if you were to buy it.
Our quick rule of thumb while looking at properties to flip is that the purchase value PLUS the rehab should equal less than 70% of resale value. For example, if we know the house will resale for $100,000 and the renovations will cost $20,000, then the most we can pay for the home is $50,000 because we want to be all in at $70,000 (or 70% or resale). This provides a margin for all the realtor fees, closing costs, utilities, miscellaneous expenses, and still have room for profits.
Day 6: Decide on YOUR investment property criteria
Everyone’s taste and needs are different. Every real estate market is slightly different. Because of this, our Day 6 challenge in our #RealEstateChallenge is for YOU to come up with a list of investment property criteria to meet your goals.
To help get you started, think of whether you are excited about the idea of designing homes and working with contractors, or if you would prefer long term cash flow by focusing exclusively on rental properties, or maybe you want to be totally hands off and provide cash investment for a partner. OR maybe you are like us lately and love to get really creative with #Extremebnbs (if you are new around here, Loma Homes is our newest baby) What does your dream investment property look like? Think of things like the number of bedrooms and bathrooms. Do you want single family homes, duplexes, triplexes, or commercial apartments? How big of a fixer upper project would you want to take on? What areas do you want to invest in? What types of returns are you wanting?
Take time today to write down a description of your ideal property, and a list of your must haves in a property. Now take that list of investment criteria and send it to your realtor so that they are on the lookout for any homes that meet them.
Day 7: Create financial plan
We’ve made it to day 7 of our #RealEstateChallenge! Day 7’s challenge is to create a financial plan.
There are multiple routes you can take financially when investing in real estate. Depending on whether you are purchasing a rental property or flipping a house there are different options available. Financing strategies can be anything with traditional bank financing, working with equity partners, buying in cash, seller financed, or working with private or hard money lenders.
Today your goal is to do some research on the different financial options and determine what will be best for you right now. Come up with your financial plan that incorporates your house price range, what financial option you want to do, and how you are going to go about using the financial strategy.