how long to get your first profitable deal? - Posted by Gary

Real Estate Investing
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Posted by Maxx(TX) on August 14, 2003 at 15:15:20:

Before I bought books that I like to keep, (not all are useful), I get them from the library first. Many of them do interlibrary loans too with other locations within the country. It may take sometime to get your hands to it, but it’s doable.

Also, here in TX, we have Half Price Books. That’s where I find my books after I read them at the libraries.

Also, lots of forums like these and check forum boards in your local REI clubs too. They sometimes have a library of books you can get your hands on. Forums give you good insights but dont do a deal hoping to get “appropriate” advice based on the boards.

Ebay may be another good source.

Depending on your strategies, or if you want specific books, here are some lists:

Flipping Properties (Bill Bronchick)
Buy It, Fix It, Sell It Profit (Kevin Myers)
Find It Buy It Fix It (Robert Irwin)
How to Create Multiple Streams of Income: Buying Homes in Nice Areas with Nothing Down (Peter Conti & David Finkel)
The 16% Solution by Joel Moskowitz
Automatic Wealth? (John R. Burley)
Blue Print for SUCCESS. (John R. Burley)
Winning the Money Game (John R. Burley)
Free and Clear Course (John Beck)

Richest Man In Babylon (Clasen)
The Millionaire Mind (Stanley/Danko)
The Millionaire Next Door (Stanley/Danko)
The World’s Greatest Salesman (Og Mandino)
Think and Grow Rich (Napoleon Hill)

I believe you can download “How to Create Multiple Streams of Income: Buying Homes in Nice Areas with Nothing Down (Peter Conti & David Finkel)” on their website: resultsnow dot com.

I’m not saying read all these books, you probably go broke on books too. But in general, know what they are.

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how long to get your first profitable deal? - Posted by Gary

Posted by Gary on August 13, 2003 at 22:15:28:

I just found this site two days ago because I’ve been looking for a way to quit my day job and real estate seems like a proven business opportunity.

I looked at a lot of the success stories and got addicted to reading them because the people who wrote them make it sound so easy!

I know that any business venture is not easy and requires a lot of work. What I want to know is how long did it take some of you to make your first profit in real-estate from the time you started learning to the time you actually got money from a deal in your bank account?

If you were younger than 25 when you started, please mention that too because I’m 23 and would like to relate with someone my age.

Thanks for reading!

-Gary

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Re: how long to get your first profitable deal? - Posted by Ron M (WA)

Posted by Ron M (WA) on August 16, 2003 at 01:31:43:

Gary,

I began reading real estate books 15 years ago. In fact the first deal I did was for my own personal residence using techniques by a Guru named Dave Deldato or something like that. I used a buy and hold strategy, since I had no where else to go, and turned a $50,000 investment with $3,500 down into a sale of $125,000 in 7 years. It wasn’t until after I realized I could have done more properties more often that I really started getting more information.

I played Robert Kiosyki’s board game Cash Flow for 2 years once a week with a couple of friends and kept reading every real estate book I could get my hands on. One night after playing the game, I decided I was tired of pretending to get out of the “Rat Race” and to start doing it for real.

I called a real estate agent I knew and he got me involved in a major rehab. I don’t recommend this to anyone for their first deal. After investing $32,000 in the purchase and $32,000 in the fix-up, plus an additional $8,000 in closing costs, we sold the property about 14 months later for $85,500, actually making a small profit.

I also, bought a 4 unit boarded up converted apartment building in a bad neighborhood. After rehabbing it with a partner we exchanged it for a 7-unit turn of the century apartment building and $27,000 cash, that we still have and rent for about a $800 positive monthly cash flow. While rehabbing the 4-unit an old home 4bd, 2ba directly across the street came up as a bank-owned property. With a partner going 50/50 we bought the property with $2,500 down each for $50,000. After some minor fix-up (including carpet & paint), we lease optioned the property for $75,000 with a $4,000 deposit and $400 per month postive cash flow.

This all occured last year. This year with the low interest rates, these types of deals have been very difficult to find in my area. However, other responsibilities have kept me from spending the extra time necessary to find the deals to do.

As you can see, I was able to do a profitable deal with my own home at the age of 25. I learned more about real estate investing by doing the deals than I could have ever gotten from all those books and courses, but it was the books and courses as well as playing the board game every week that gave me the courage to persist when unexpected surprises came up.

Read, study, and then go. But always expect the unexpected. Remember when surprises happen, there is a solution to every problem as long as you stay solution oriented and not focused on the problem.

Ron M (WA)

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Re: how long to get your first profitable deal? - Posted by Brad (CA)

Posted by Brad (CA) on August 15, 2003 at 22:59:45:

Let me jump in here for a sec too!

I began learning last Sept-Oct('02) and began actively mailing, advertising and calling FSBO’s in Dec. After about March or April I had no more cushion money and basically had to close shop and look for a job. High unemployment, start new job Mon after next(6 months of lookin)!!! So it took a while but everything will not have been for nothing. Now that I have stable(?) 2600 a month coming my way I have pretty much completely obliterated the majority of my anxieties and fears. These next 3-4 months are going to be GREAT!!! I cant wait! During this interlude I still tried to keep up with reading and learning, just not so intense and it has been beneficial.

I’d like to defer to another article I read earlier this year that helped me decide how I would persue this biz. www.creonline.com/wwwboard/messages/67228.html

“The best way to make it as a fulltime investor is to start out as a part-time hobby.”- Hal Roark

That pretty much made it for me. Not that I’ll go easier and not be as dedicated, no, just that I’ll expect the failure, sacrifice and hurdles that come with breaking into a new field and work more diligently to build myself a successfull fully grounded buisness.

I’m 23 years old just out of college(last Dec).

Best,
Brad

PS-BA in Philosophy so you know I got nowhere else to go!!! :slight_smile:
PSS- Funny thing, after all these months of trying to be in the market I just today went and met my first seller. Easy as pie, now I just have to make sure the next 20 I see are motivated!!!

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thanks for the help - Posted by Gary

Posted by Gary on August 14, 2003 at 14:35:26:

So the consensus is not to jump in and make deals before doing research and learning for a few months.

I have no problem with learning something new and finding out as much as I can about it. I do have a problem with taking the first step after I have learned everything.

I do need to read up on the laws of RE and all the different forms and contacts that I need to make. Any specific books that you would recommend for me to buy? I would rather buy the books first and then move on to courses. I don’t have hundreds of dollars to shell for a course now.

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My Thoughts - Posted by Bob(DE)

Posted by Bob(DE) on August 14, 2003 at 13:46:25:

Gary

Its nice to see other yougins in here?I?m 24 and have been bitten by the RE bug as well. I agree with the other posts mentioned. As Mr. Starr has suggested, if you havent read his beginners article, it?s a must read at this board. I can understand the urge to jump into full time RE, but again I agree with many of the other posts on this board that REI should start off as a slow learning process. I don?t know you however, and its hard to judge your situation, but I figure your in one of two boats?either you?d rather be your own boss and not have set rules to follow, or some situation in life is giving you no other choice. Either way this board contains a plethora of knowledge to guide you. If you would simply rather be your own boss, my opinion is not to rush?why not set up a strong backbone that you can invest under? (get a hold on your personal finances, educate yourself in all areas of investing, read as much as you can about REI, buy a house to live in, then start buying investments). If you have to work in REI to put food on the table, the situation is different, im not in this boat so I cant comment from experience, but be careful?talk to as many investors as you can and start looking at short sales. Many people on this board advocate being a ?birddog ? for others to get paid for references for sales.

I would love to be my own boss, and own a handful of businesses, but I also like my job now. My path as I see it is to begin gathering rentals in my area, and holding them long term. For you, another strategy may fit better?take a look at them all, spend as much time as you can learning before spending your hard earned $, and start moving?don?t get trapped in analysis paralysis once you?ve got a strong base to start from.

Just my thoughts?good luck
Bob

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Re: how long to get your first profitable deal? - Posted by Gunn(Ga)

Posted by Gunn(Ga) on August 14, 2003 at 12:10:31:

Two years of reading courses, RE books, and this Site
Started making offers six months ago
Just closed 1st rehab (bought and sold in 4 weeks)
Profit 14k for me and 14k for my partner

Probably never would have gotten off the sidelines if not for this website.

Gunn(Ga)

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Here’s my take on this - Posted by Maxx(TX)

Posted by Maxx(TX) on August 14, 2003 at 10:21:20:

Gary,

While Real Estate has made many people very rich, we hardly hear about those many more that has gone down under.

How long should not be the question. That sounds like you are getting eager and dont get me wrong, there’s nothing wrong about that. But through education, reading, networking are some places where you could possibly shelter some “mistakes”. Persistence is part of the game because you are in this for the long-haul.

You mentioned “I’ve been looking for a way to quit my day job”.

Stop and take a step back, understand the whole picture. You are trying to quit your day job, I’m assuming you want to own your own business, determine your own worth. Eventually, be able to go towards the path of Financial Independence. Your mindset before you do anything is very important.

You are right, at 23 if you plan this for the long-haul, you can get there much quicker than most people.

Yes, Real Estate can get you there. But please understand that Real Estate is the vehicle that brings you from Point A (your dayjob) to Point B (Financial Independence).

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Re: how long to get your first profitable deal? - Posted by Ronald * Starr(in No CA)

Posted by Ronald * Starr(in No CA) on August 14, 2003 at 09:52:56:

Gary--------------

I was 23 when I bought my first house, where I lived and rented out bedrooms to students. So, I started putting money into the bank from the rents about three months after I started.

However, I don’t think you should expect to do so as soon. I have a post for beginners, which is found by putting “beginners success” into the archive search function on this main board of this CREONLINE.COM website, were I recommend expecting to spend about 6-18 months studying before you start spending money. So, Pete is right in there in the middle. That is typical of successful real estate investors, I would venture to guess.

Good Investing**Ron Starr

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Re: how long to get your first profitable deal? - Posted by pete

Posted by pete on August 14, 2003 at 08:44:34:

Gary,

it took me over a year to make my first profit in real estate. you have a lot of studying to look forward to, but it is worth it in the end. I am also 24 and it is not a problem. don’t let age or any excuses stop you.

pete