Welcome back, Hybrids!
Today, we’ll dive into four critical focus areas to to set yourself up for long-term success in real estate as a busy hybrid professional.
(Today’s issue takes ~3 minutes to read)
Investing in real estate can seem overwhelming on the surface.
Especially as a hybrid professional with a busy life.
You’re already juggling:
Your job
Your health
Your family
Your hobbies
Your finances
Your household & never-ending chores
Heck, I’d say doing dishes, cleaning & laundry for a 3-person household with a young kid is a part-time job by itself!
And now you’re considering adding real estate investing to the mix?!
Wowza!
[Insert your critic’s name here]: “How are you going to handle all that without getting overwhelmed?”
Hush, critic!
With the right preparation, the journey can be smooth and rewarding.
Before you dive headfirst into real estate, it’s important to outline your goals. Be specific!
And no, “I want to invest in real estate to make money” is not a specific goal…
Investing goals fall into two common categories:
Financial (like generating a certain amount of passive income or building a specific net worth)
Lifestyle (like achieving more time freedom),
Or a mix of both.
Figure out what you’re aiming for.
Examples of specific goals:
“I want to generate enough cash flow from rentals to cover my monthly living expenses.”
“I want to own enough rental properties and pay off the mortgages by the time I’m 65 so I can live off the cash flow in retirement.”
"I plan to buy 1-2 rental properties as a side project, but don’t intend to scale beyond that.”
Notice how that last one might be better for busy professionals who can’t dedicate large pockets of time to scale a real estate portfolio.
The point is if you don’t define what you’re aiming for, you can’t create a sensible plan to get there.
Read my past article on The 5 Whys: An Exercise To Align Your Goals With Your Intentions.
Additional Resources:
A clear understanding of your current financial situation is crucial to avoid critical mistakes.
If you miscalculate your starting point, you could do serious damage to your personal finances!
Take stock of the following:
What’s your credit score?
How much debt do you currently have?
How much cash do you have available to invest?
Are you taking in more money every month than you’re paying out? (If no, then I suggest you address this before investing in real estate)
Once you’ve measured your baseline financial situation, you can start to answer these follow-up questions:
What market(s) can you afford to invest in?
How long will it take you to save up for a down payment?
What kind of cash flow do you need from each rental property to justify the investment?
Lay all the cards out on the table so you can get a clear picture.
I outlined a 4-step process to build a personal balance sheet in 15 minutes or less in a previous article.
Additional Resources:
Real estate investing is seldom a one-person show. You'll need a team.
Here are the common team members:
Real estate agent
Property Manager
Lender/Mortgage Broker
Contractor/handyman
Attorney
CPA
With a solid team in place, you’ll be able to maintain your portfolio without compromising your other responsibilities in life (work, family, health, etc).
Start researching and networking to find the right professionals who understand your goals.
For a deeper dive on building a team, I recently launched an Ultimate Interview Template Pack to Build Your Real Estate Investing Team.
You can also read my past article here.
Additional Resources:
BiggerPockets Forums: https://www.biggerpockets.com/forums
REIA (look up local group): https://nationalreia.org/
There are numerous strategies for real estate investing:
Fix & flip
Wholesaling
Syndications
Long term (aka “buy & hold”)
Short-term rentals(AirBNB, VRBO)
Real Estate Investment Trusts (REITs)
Medium-term rentals(Furnished Finder)
(There are more, but you get the point)
I strongly encourage you NOT to try and take on multiple strategies, especially at the beginning.
The skills it takes to flip houses are an order of magnitude different (and more time-consuming) than running a single-family long-term rental.
Do NOT assume that knowledge from one strategy will translate perfectly to another.
Research these strategies
Weigh their pros and cons
Choose the one that fits best with your goals and current situation.
(Credit: Coach Carson)
Resources:
BiggerPockets Real Estate Investing Guides: https://www.biggerpockets.com/guides
Roofstock: https://learn.roofstock.com/blog/types-of-real-estate-investors
Real estate investing doesn’t have to be overwhelming.
Take these 4 steps to plan your investing journey and start on the right foot:
Set clear goals
Understand your finances
Assemble your team
Choose your strategy
With these steps, you’re well on your way to becoming a successful real estate investor.
Until next time,
-Aaron
PS: Ready to jump-start your real estate investing journey? Book a FREE 45-minute strategy call here to discuss your unique situation and create an action plan.
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