If I Was Starting Over in Real Estate, Here’s Exactly What I’d Do

If I was starting all over today at zero and I own no real estate, here's what the first time property I will buy and how I'll finance it. This is the most common question someone asks me all the time. That if you started over today, how would you start investing in real estate? And today you're going to find out exactly how I'll do it step by step. It doesn't matter where it is I live. The same exact step will happen anywhere in the United States. All right. Here's the first thing. The first thing is I got to ask myself, where do I want to buy? In any market, I need to know where is the A neighborhood, the B, the C and the D. The A is a really high end neighborhood. I'm not going to buy there because it's not going to make no sense. It's too expensive for a first time investor or a buyer. D, which is the opposite end, which is the really rough neighborhood. I don't want to be in there. And I'm going to buy anything to actually fix and flip or actually keep as my own primary to live in or as a rental property. I want to stay right in that B and C area where basically it's the average where everybody live at the high end at the really cheap end right in the middle. That's the first thing I would do. Then I will actually go out there and find me a single family home just like this. See this house? It need a little bit of work. I don't need to buy it. Perfect. Matter of fact, if it need a little bit of work, I don't care. It helped me get the price lower. I will buy a home that need some work and I'll make sure that lot's big enough just like this. See that garage? It sits on the back of the property where this is one lot. And the reason why is because if I ever want to tear this garage down, I can put an additional dwelling unit right here. ADU. Now, I don't care where you live in the United States. ADU is in your town now, OK? So you don't have to build it right away. But if I was starting over, I would buy myself a home that need some work. Ideally, to keep the price down. With a big yard. And so I can actually develop this and put more unit on it later. This is what I will buy. One thing right here. And then I'll show you what else I will buy. Also, as a single family home, if I don't buy a single family, here's the next thing I will buy if I was starting out. Here's the second option I will buy if I don't buy a single family home. I will buy myself a duplex, a triplex or a fourplex like this that I own. OK? The reason why fourplex and less, they can still consider a single family, not commercial. So what you do is you buy, let's say, a fourplex. You live in one. You rent the other three out. The other three, depending on the rent, it could actually help you live in your unit in this building. Little for little rent or almost no rent at all. You don't have to pay any of the mortgage because the other unit is paying for it. One of our students from Houston, they bought a duplex. They went out the one side to live in the other side. That's how they live in, right? They pay less than like 800 bucks. And there was a rent that on open market, it would have cost them probably around $2,000. So they lived there for a little less than half versus if they would just go out to purely rent. So I would buy a single family duplex, triplex, fourplex. Now, condition wise, you can buy a fourplex, triplex, duplex that need a little bit of work. If you do that, you can actually get the price lower and you can buy this, you can rehab and you can spike the value. And by spiking the value, you can create sweat equity. You create sweat equity, right? You could actually have some extra cash in your pocket or equity in your property. But at the same time, right, you can actually live here for little to nothing because the rent, when you get done with it, it's going to be high because it's a brand new building after you remodel it. So I would buy me a cosmetic fixer, multi-unit or cosmetic fixer, single family, single family. I got to make sure I got a yard in the back. Also, a duplex or fourplex, if you can find it, you want to find something with a backyard so you can add more unit. And I'm going to show you what I mean by that here soon. If you want to learn how to buy your first rental property or your next rental property and be the one in your family, let me teach you how to do that. I have a mentorship program called Springboard to Wealth and I'm going to teach you all across America how to buy the first rental or the next rental property. Hit the link in the description. Come join me. I want to show you the back of the fourplex. When I bought that fourplex, it had a backyard. And then after I bought it, I rented out for a while and then eventually I ended up building six more units in the back. And this is what I mean by buying a single family or multi-family with a backyard. So in the future, when you're ever ready, you're going to add more value to the backyard. Now, instead of a six unit, this has become a ten unit property now. OK, so now you know where to buy and what to buy. Let me just give you two basic simple strategy on how you can actually buy and scale. OK. All right. I don't care if this is a single family home or a multi-unit. If you are a first time buyer, what do you want to do? Single family or multi-family? You can put down a little less three and a half percent down on the property. If you do that on a single family, you live in it. Hopefully you actually can get a house where you have at least three bedrooms. You can rent out the bedroom, make some money, or you have a house with a basement. You can rent out the basement and you live upstairs to help offset the mortgage. In the meanwhile, you can save more money. OK. Or when you do a multi-family like this, you can put down three and a half percent down. You can live in one unit. You can rent the other three units out. That way, again, you keep your mortgage low. Right. Save some money so you can actually repeat the process. Now you have to wait for one year until you can actually turn that house or turn one of your unit into a rental property. And then you go repeat the process and you do it again with three and a half percent down. OK. That's one strategy. I'm going to give you a little more advanced strategy. OK. Let's say you buy a fixer house with that big lot I just mentioned. You buy the fixer. There's a program that you put five percent down conventional rehab loan. You buy the property as a fixer. Figure what it cost to rehab it. Put five percent of the purchase and the rehab together. Five percent of that. You rehab the property. You spike the value. You create equity idea. You want to get at least 20 to 25 percent gross margin of profit. OK. And it'll happen when you get done rehabbing and you refinance that into permanent financing, put some cash, put it in your pocket. OK. You live there. You rent out the rooms or the basement. You can do the same thing with multifamily. OK. You live there for a year. The money that you made from creating the extra equity. You can buy. You can use that property. You can buy yourself another set right away. A fixer upper with the down payment money. But you have to put 20 percent this time. Hopefully you create enough equity out of the bird strategy. I just talked about the first property. Take that equity. Put 20 percent down on the next thing for a fixer or multifamily fixer. You create that value again and you get less with equity in that property. When you refinance the financing, the banks that said you have enough equity in it from your you created it. The down payment you put down 20 percent. You can actually refi and get that money back in your pocket. And you use that money right there to keep buying more property. But then the property you live in every year, you just trade up, trade up, trade up with three and a half percent down and the other money you you can actually scale it so you can do both track at the same time. Or you can do five percent once a year, once a year. Or you can do a bird live in one. Get the equity out. Right. And as you live in here, you can do another project. And then when this year come around, you do that again on the primary where you live in, then the money you're making, you do this. These are the two strategies I would do if I started over today. Buying the same type of property in a certain area so I can actually start and start scaling. All right, everybody, that's a wrap for this video. Now you have a real good idea on how my brain think. And I was starting over today. How would I actually start investing into scaling with very little money? And this is how I would do it. I hope you got to learn a lot from this video. Take that and start doing it yourself. All right. Now, if you have not subscribed to my channel, hit the subscribe button for me. Tell all your friends about the video. All right. If there's any other topic we're going to talk about, put in the description and tell them we'll talk to you soon. Peace.