Thread: Real Estate Investing - I need some guidance!

I am constantly hearing about how real estate is the way to get wealthy. However, I have absolutely no idea where or how to start. I live in southern California, I only make $51K salary (BEFORE taxes) and I am paying $1050 to rent a 1-bedroom...so that's not really leaving me with much to work with. What is the first step I need to take?

Originally Posted by Palifornia562

I am constantly hearing about how real estate is the way to get wealthy. However, I have absolutely no idea where or how to start. I live in southern California, I only make $51K salary (BEFORE taxes) and I am paying $1050 to rent a 1-bedroom...so that's not really leaving me with much to work with. What is the first step I need to take?

Buy your own house, condo, etc to live in. Paying rent is just throwing money away! Get that step under your belt, enjoy the tax break, then work on looking at investment properties.

Where in SoCal are you? What can you buy a place for? if you live in LA good luck finding much under $300k, vs I-E etc.

Unless you're very diligent, with that salary you're going to have a hard time limping into it in SoCal, lots of big $$ investors snatching things up in blocks (5 homes+ etc) from the banks, all cash.

There are a few people who do very well with real estate, but it's a looong term growth type of thing. You're not going to jump out there and throw down multiple $M's to develop a property and make the killing, especially in this economic climate on a $50k salary.

start simple, start cheap, start in the neighborhoods where the post-college kids are buying up older homes and remodeling them.

I buy property practically weekly from tax auctions and email all my friends with it and move it quickly. Warranty Deeds, courthouse title transfers.. simple, clean and profitable.

For example, I bought this little place at the lake for back taxes this week. Its a 1971 5th wheel travel trailer with a built on addition, bathroom and guest cabin. It was abandoned 2 years ago. I paid $940 for it. Its nothing I would consider owning for myself or trying to fix up and flip, so I sent an email to a buncha friends that had been mooching off my lakehouse last year and had it sold within 3 hours of the email going out. Sight unseen. $6500 cash. Not bad for a days worth of work..

Theres lots of way to make money in real estate and lots of ways to LOSE EVERYTHING YOUVE EVER EARNED and screw your credit in the process.. Buy cheap, work cheap, and be smart about it. And dont make the mistake of trying to make this a full time job. Keep it as a hobby for a few years.

Thats my own advice, lots will argue, some will agree, but Im just posting what has consisttently worked for me the past few years.

^ That's not a bad gig, but things like that are far less common in SoCal. We're in a whole different game out here.

Anon, where do you live? I am in Long Beach

Originally Posted by Palifornia562

Anon, where do you live? I am in Long Beach

I'm everywhere In Irvine or Palm Desert depending on whats going on.

Originally Posted by anon

Buy your own house, condo, etc to live in. Paying rent is just throwing money away! Get that step under your belt, enjoy the tax break, then work on looking at investment properties.

I agree. Start small and work your way up. You might as well be paying off a mortgage instead of paying it off for someone else.

A word of advice, be careful of "condos" because of their potential high condo fees. From what I have heard, in some states, if people are not paying their condo fees, the other people in that condo are splitting the costs for them. Condos, in general, have pros and cons. Pros because they will cover exterior insurance (usually), outdoor maintenance, cable tv and some times water as well. But a con is that if you are going to be paying a few hundred in condo fees, you might as well put that towards a mortgage on a more "valuable" property.

Originally Posted by waterboy222

Theres lots of way to make money in real estate and lots of ways to LOSE EVERYTHING YOUVE EVER EARNED and screw your credit in the process.. Buy cheap, work cheap, and be smart about it. And dont make the mistake of trying to make this a full time job. Keep it as a hobby for a few years.

I have seen a lot of people lose everything they own with a few bad investments. I agree with Waterboy, start small and work smart. Don't think that investing money INTO a property inflates the price. Nobody buying a $100k house is willing to pay extra for the $5,000 granite countertops you just put in. Match your renovations and work according to the comparable in the area.

But my word of advice is read. Read about success stories. Read failure stories. But like Waterboy said, it will be difficult to make this a full time gig without knowing what you're doing. It's not like the tv shows. hahaha....

Buy a condo in the ie area. It will be hard to get a good one but its possible. As someone said earlier people with $$$ are snatching the good buys in cash before they even hit markets. I tried to buy a $150k condo and there was 46 offers on it. I already own two but im kinda fu**ed on them. :/

I would suggest you look for multi family properties outside of So-Cal or even Cal altogether. For instance in Texas, Ohio, etc. Start small and work your way up. Don't make the mistake of buying and selling homes, it isn't as profitable and isn't really worth the time. Your best bet is to start small with a douplex, fourplex, etc. and get a management company to take care of it for you while you continue in your path to financial success.

If you need any help, Pm me and I'll try to assist you.

All The Best!