How to get to the fastlane with real estate?

[TL22]

I just finished the millionaire Fastlane , and was drawn most to the mention of Real Estate even though I have no experience in this area, other than owning my own home.

In the book, Real Estate is described as fast lane 1.0 and certainly has many different opportunities available across that broad category.

I’m interested in starting a real estate, but I think my process might appear to be similar to those on the slow lane, and how problematic that might be, even if I’m willing to pivot in the future after I gain better education and experience in real estate.

I’m starting this journey older than I have read about on the forum, my current W-2 income is necessary to sustain a family, so I’ll be putting in many hours in the evenings, also able to invest some money, previously saved to help ignite this new Fastlane journey from day one.

Thought of participating in a quality real estate syndication as an LP appears to have many advantages, in addition to passive income with some initial, cash flow, mini offer monthly calls to discuss their investment and status, which appears to be a great way to gain some knowledge and education.

As I am not handy, the thought of a single or multi family rental purchase, has been a bit hesitant, knowing I would likely be outsourcing much of the property management. Though, if I was able to find a partner at a local meet up or mastermind group, I think this could be an ideal path, especially as I have to offer someone interested in partnering (ideally someone willing to also be a mentor). However, I’m willing to go it alone, if it’s putting me on the correct path.

Overall, I realize it will take some time for a Real Estate path to snowball, and I’m certainly able to continue reinvesting all monthly or quarterly gains back into a real estate portfolio.

But I’m hoping to obtain some helpful direction from the smart people on this forum, as I want to make sure, I’m spending my time wisely, and going down a correct path, at least initially.

I will come any in all comments or advice. Thank you in advance for helping.

 

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[LateStarter]

I've always self-managed my own portfolio of multifamily and short-term rentals, and done my own flips because I'm handy and enjoy it. I've never done any syndications, wholesale deals or anything else so unfortunately I'm probably not the best one to give you advice.

What I can say is that real estate has been a great investment for me and my family. It feels painfully slow at first to build any moment; particularly with other people here doing ecommerce on faster growth curves. But it's lower stress and it snowballs over time. Before you know it your net worth is 10x+ where you started and it feels like no time has passed.

I started in real estate and leveraged thise experiences and connections to build businesses (also in real estate). Now I'm branching out and buying other businesses in non-real estate areas. So I'm doing it backwards compared to most people on the forum who use real estate as a way of parking money earned through other business activities.

Best of luck!

 

[TL22]

What I can say is that real estate has been a great investment for me and my family. It feels painfully slow at first to build any moment; particularly with other people here doing ecommerce on faster growth curves. But it's lower stress and it snowballs over time. Before you know it your net worth is 10x+ where you started and it feels like no time has passed.

Thank you for the helpful reply. This helps confirm that I’m considering a good path even if it’s different than most others here.

Unless you suggest differently, I believe my first steps should be to try and find properties that would be considered quality investments. And I understand this might take awhile but I’d guess this is a necessary and possibly difficult step to invest in real estate.

Are there any books or websites or software programs or formulas I can type into excel to begin my property research phase? Anything at all would be a help.

 

[Antifragile]

I only know real estate. Nothing else I say on this forum has any real credibility.

As a field, it’s so broad that you must narrow it to something…

Realtors are in real estate and it is NOT fastlane. Yet they are “CEO’s” of their own entity, while also being one person company.

CRE brokers are similar, but just do bigger deals. Selling $1bl portfolio makes a great commission, yet few make it to that league.

Then there are marketing firms, architects, contractors etc. everyone technically in real estate.

Then there are bankers, who specialize only in real estate. Same there.

It gets worse!

Housing, office buildings, industrial, retail are your major food groups. Then there are sub groups: cold storage, hotels, student housing, self storage, parking …

To be good, specialize.

The list is so long, I honestly can’t imagine completing it. So I’ll stop.


Step 1: research and study.

I know, theory is boring. But “finding a property” when you could have created a business… is that your dream?


How you own real estate later is yet another question. You mentioned syndication… sure, but to attract capital you’d need to demonstrate your ability to add value (yield) to that capital.

Again, starts with theory.

And guess what… textbook isn’t a bad idea. There are many… look up ULI and their bookstore. Or just google.

Oh and a “read this 2 page course to make it big in RE” by the latest internet guru won’t cut it. Avoid those like plague. That’s why I said - TEXTBOOK.

Then consider getting a job at a firm doing what you may want to be doing. It’s one stone two birds. You make money and learn.

Unpopular opinion for some on this forum - 10 years is what it’ll take to become fastlane. But if you do it right, it’s all but guaranteed to succeed.


Good luck.

 

[TL22]

Step 1: research and study.

I know, theory is boring. But “finding a property” when you could have created a business… is that your dream?


How you own real estate later is yet another question. You mentioned syndication… sure, but to attract capital you’d need to demonstrate your ability to add value (yield) to that capital.

Again, starts with theory.

And guess what… textbook isn’t a bad idea. There are many… look up ULI and their bookstore. Or just google.

thank you for helping.
Theory is often an exciting topic for me.

Do you have any specific textbook ideas as a starting point for learning how to “find a property”?

 

[LateStarter]

Your first step isn't finding quality investments, it's coming up with your own method to evaluate whatever investments you want to pursue. Then review properties on the market that fit what you're looking for, run your own numbers to see if you'd do the deal or not, then monitor those deal to see what they sell for and how fast.

It's about understanding your local market, in your niche, and being comfortable with your numbers and your criteria. That way when you see a deal that looks good, you'll have the confidence to proceed quickly and know it'll be right for you.

When good deals come up in real estate you have to act fast to be the first in line. You want to be the guy who scoops the deal before anyone else, not the first sucker in line for a bad deal. If you're not careful, you may not know which you are.

Figure out what kind of real estate deals you're interested in first, then do your homework on that area. I like small multi-family residential. It gives me multiple income streams, one property to manage, that I can usually convert back to a single family if needed. I have options and safety nets with them. Figure out what makes sense to you and start there. Then figure out expected costs, metrics etc. to help you analyze those deals.

None of this is rocket science. You can figure it out yourself even without YouTube, books, meetups, etc. Those are just extra tools to help you get there faster, analyze different angles and provide different strategies.

Like @Antifragile said, expect it to take a decade. It took me 7 years because our market was hot, but it also depends on how much extra cash you can put towards growth.

 

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[Antifragile]

thank you for helping.
Theory is often an exciting topic for me.

Do you have any specific textbook ideas as a starting point for learning how to “find a property”?

You don’t get my point at all…

I’m recommending you don’t go down looking for a property without some help.

It’s like saying Real Estate is “easy”, I just need to try it, right?

Clearly not…

But just how hard is it to bring a project on time and on budget?

Turns out the odds are very low! 8.5% only.

"The Iron Law of Project Management" by Bent Flyvbjerg, Professor at Oxford:

- All projects: 100%
- On budget: 47.90%
- On budget and on time: 8.5%
- On budget and on time & some other benefit: 0.50%

Don’t obsess with theory either.

I’ll rephrase my advice: create a plan of action. In that plan if you lack experience - find a way to bridge that gap (education 30%, people 20%, doing 50%).

Only when you’ve mapped out your road, proceed to look for a “project” or property.

As far as books go… I can give you a huge list, but first you do your own research and tell me what you find out. Spoon fed isn’t as appreciated as self made.

 

[TL22]

Your first step isn't finding quality investments, it's coming up with your own method to evaluate whatever investments you want to pursue. Then review properties on the market that fit what you're looking for, run your own numbers to see if you'd do the deal or not, then monitor those deal to see what they sell for and how fast.

It's about understanding your local market, in your niche, and being comfortable with your numbers and your criteria. That way when you see a deal that looks good, you'll have the confidence to proceed quickly and know it'll be right for you.

When good deals come up in real estate you have to act fast to be the first in line. You want to be the guy who scoops the deal before anyone else, not the first sucker in line for a bad deal. If you're not careful, you may not know which you are.

Figure out what kind of real estate deals you're interested in first, then do your homework on that area. I like small multi-family residential. It gives me multiple income streams, one property to manage, that I can usually convert back to a single family if needed. I have options and safety nets with them. Figure out what makes sense to you and start there. Then figure out expected costs, metrics etc. to help you analyze those deals.

None of this is rocket science. You can figure it out yourself even without YouTube, books, meetups, etc. Those are just extra tools to help you get there faster, analyze different angles and provide different strategies.

Like @Antifragile said, expect it to take a decade. It took me 7 years because our market was hot, but it also depends on how much extra cash you can put towards growth.

I really appreciate that help. It sounds like a great exercise to run my own numbers but then find out what it eventually sells for to see how close I was and to learn the market. Thank you. Do you suggest I start with Zillow or are there better platforms to help me find rental properties without having to look through all the residential home for sale?

Out of curiosity have you ever converted one of your multi family units into a single family home? Having the option does sound great!

Are there any other real estate assets classes that could also come with a bit of a safety net? I couldn’t think of any off hand so I appreciate you sharing your approach so I can start thinking in those terms.

 

[TL22]

You don’t get my point at all…

I’m recommending you don’t go down looking for a property without some help.

It’s like saying Real Estate is “easy”, I just need to try it, right?

Clearly not…

But just how hard is it to bring a project on time and on budget?

Turns out the odds are very low! 8.5% only.

"The Iron Law of Project Management" by Bent Flyvbjerg, Professor at Oxford:

- All projects: 100%
- On budget: 47.90%
- On budget and on time: 8.5%
- On budget and on time & some other benefit: 0.50%

Don’t obsess with theory either.

I’ll rephrase my advice: create a plan of action. In that plan if you lack experience - find a way to bridge that gap (education 30%, people 20%, doing 50%).

Only when you’ve mapped out your road, proceed to look for a “project” or property.

As far as books go… I can give you a huge list, but first you do your own research and tell me what you find out. Spoon fed isn’t as appreciated as self made.

Thank you so much for giving it to me straight. And for providing me answers while also leaving some work for me. It’s an approach that I value and one I really needed to get me going. I’ll start acting on the action plan as you so helpfully provided.

As for books, I took some time to do quality research but gave myself just a couple days so I didn’t fall into analysis paralysis. Do any of these make your short list of recommendations?

Rental Propery Investing - Brandon Turner
ABC’s of Real Estate Investing - Ken McElroy
The Millionaire Real Estate Investor - G. Keller
Skip the Flip - H. Crabtree
The Wealthy Gardener - John Soforic
How to Invest in Real Estate - Dorkin & Turner

 

[Antifragile]

Thank you so much for giving it to me straight. And for providing me answers while also leaving some work for me. It’s an approach that I value and one I really needed to get me going. I’ll start acting on the action plan as you so helpfully provided.

As for books, I took some time to do quality research but gave myself just a couple days so I didn’t fall into analysis paralysis. Do any of these make your short list of recommendations?

Rental Propery Investing - Brandon Turner
ABC’s of Real Estate Investing - Ken McElroy
The Millionaire Real Estate Investor - G. Keller
Skip the Flip - H. Crabtree
The Wealthy Gardener - John Soforic
How to Invest in Real Estate - Dorkin & Turner

 

[TL22]

View attachment 53760

You weren’t kidding when you said the word textbook earlier.

And this wouldn’t have come on my radar without your assistance so I thank you for that. I’ll find it and place the order today so I can begin this week.



And on a slight tangent, should I be starting the process of forming an LLC for the eventual purchase of my first property? But if that’s a case of me getting too far ahead of myself, just let me know. Thanks

 

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[Antifragile]

And on a slight tangent, should I be starting the process of forming an LLC for the eventual purchase of my first property? But if that’s a case of me getting too far ahead of myself, just let me know. Thanks

No.

First learn about real estate structures. Will you be using a Corp or a GP/LP? If you don’t know, how can you “register”, right?

Good luck.

Prepare for the long and fun road ahead.

PS I’m surprised you haven’t gone deeper on me. Here’s a thread I wrote a while back you’ll probably find useful.

Thread '7 Steps on How to Become a Real Estate Developer. *AMA on RE Development*'
GOLD! - HOT! - REAL ESTATE - 7 Steps on How to Become a Real Estate Developer. *AMA on RE Development*

 

[originalMJT]

View attachment 53760

Thats a pricey book, £150 on UK Amazon, is it worth it and would the advise work for the UK market ?