How Much Should You Plan to Make Your First Year Investing in Real Estate?

This is a great question, and everyone is hoping for the moon, the stars and everything in between but often times finds that it’s a lot more likely to get off the ground and call that a win.

The reality is, you shouldn’t plan to make a full time living in real estate your first year.

But don’t let that stop you from working towards it.

Just make sure that, just like any business venture, that you’re going forth with clarity on the numbers that are needed to make the business work, the time, resources and energy you’ll need to invest to get things going.

Businesses can sound extremely sexy when you’re sitting behind the desk watching a webinar about “the next big thang” and dreaming about all the vacations that you’re going to be going on and all the funs stuffs you’ll be doing.

That being said, if you only focus on investing in real estate for all 30 days straight, expect to do your first deal in 3–4 months.

This could be longer if you’re not trained, in fact you may even lose money on your first deal if you don’t know what you’re doing, but hey, that’s business right?

So Really What Does The First Year Look Like?

Well if you don’t know how to market for deals then you’re probably looking at 1–2 deals your first year totaling around $10–20k (if you’re wholesaling).

Now if you have abso-freakin-lutely ZERO experience and you’re able to turn a profit, consider yourself a champ! You won and got lucky. Now do it again.

But many people find that the first deal is THE hardest and is likely the bottle neck to a flood of deals if they can just break the #1.

Now can you do more or less, sure, but without experience you’re going to struggle to hit that mark due to the confidence effect.

So what can you do year 1 to get the confidence to find your first “deal”? Well, you can learn to market for deals.

How? Various ways. Post ads on Craigslist, road signs, cold calling, Facebook marketplace, groups, networking events, etc.

You can go to a weekend boot camp and pay $8G’s to learn how to do this, spend hours and hours on the interwebs trying to learn how, or you can get trained through an investor group but the point is you’re either going to learn through the school of hard knocks or by paying for the info from someone else who learned through the school of hard knocks.

The question is which is less expensive? And the answer is other peoples mistakes ;)

— — — — - — — — — — — — — — — — — — — — — — — — — — — — — -

want a free wholesale beginner checklist to launch your wholesale bid-ness? Signup for my monthly newsletter and you can download it here: http://eepurl.com/new-investors

Little note, I don’t spam no ones, just share valuable contents on the regular. So if you’re interested in getting knowledge bombs sent to your inbox each week or month (kinda when I feel like it or have something amaze-balls to share, then sign up, if not it’s cool too if you just wanna swipe my cheat sheet and unsub, won’t hurt my feelings… just your own chance of success

— — — — — — — — — — — — — — — — — — — — — — — — — — — — — -

Anywho…

I wouldn’t dive into ads right away; I would work my way up to that point before trying to do it all at once.

Start with cold calling, road signs, and craigslist / other free classifieds sites to get your feet wet and once you do your first deal then you can move into more “sophisticated” strategies.

Where can you find leads more likely to sell to you?

Zillow, craigslist, Facebook marketplace, rental sites (look for for rent by owner).

Just go to these sites and learn to utter this phrase “Hi my name is [name], I was curious about your property at [address] can you tell me more about it”. Then when they tell you more ask, “and why are you selling?” or “why are you renting it?”

Then shut-up and listen.

Practice this phrase over and over again.

Become a MASTER at saying this with enthusiasm and curiosity.

This will open up doors to your first deal.

Once you get your first deal under your belt you will see the flood gates fly open.

Some numbers:

What can you expect to make on a wholesale transaction? $5,000-10,000 per transaction depending on the deal and how much the home is worth, what the flipper will make, etc. Just like grannies diapers…depends!

What can you expect to make on a flip? Roughly $30,000–50,000 but again DEPENDS on capital invested and the price of the property, market rates, CMA results etc. etc.

What can you expect to make on a buy and hold? $400 -600 a month cashflow roughly. If you’re not making this much then why the heck are you buying it?

And DON’T say appreciation!

What happens when the market reverses and you have to PAY monthly to afford the right to rent it to someone?

What can you expect to make on an apartment complex? $127–157 a door. Yes profit per door.

So realistically to make $40,000 a month you’ll need 4 wholesale deals (and a full pipeline), 1–2 flips a month, 10–20 buy and hold rentals or 300+ doors for apartments.

Now considering most people don’t have $300,000+ to put down on an apartment complex, and some of you reading this may not even have $20,000 to put down on your first investment property… it’s probably better to start with something smaller and grow to that.

So What’s Our Plan?

Well, if wholesaling costs $100–200 a month in software and time, then it makes sense to go with that to start out right?

Rolling up into a flip and buy and hold business and then converting those properties into commercial or multifamily.

Another option is, if you have limited funds to go about doing short term rentals and co-hosting or managing property like we do.

Less out of pocket, more work, and the owner or passive investor gets to benefit by knowing that their money is growing without their sweat. You on the other hand, gotta sweat baby sweat to make that money so you can buy YOUR passive investments.

This is a great way to partner with someone with assets that are not producing what they could be and generating $300 – 700 a month cashflow per unit of production (i.e. room).

Alternatively you can just agree to sign a long term lease and pay the rent each month, then cashflow the difference between nightly or monthly and the 12 month term.

So to make $40,000 a month you would need 6–7 short term rentals, and you could structure that to where you don’t need to come out of pocket if you’re willing to find money partners.

Another option is to partner with an investor training company and marketing their investor training system.

Make sure you vet the company, and you research them on sites like BBB, the FTC and check with their DUNS account to see if they are who they say they are, call their corporate office and ask employees if they like working there, and in general don’t rush into marketing just any program.

Renatus, the program that we refer people do pays between $300 and $3,000 per referral for new marketers, and can pay you up to $11,200 for the highest level of education, which is only $22,000.

Compare this to a traditional school like a 4 year university and you’re looking at easily $40,000–100,000 for 4 years.

the best part is you get access to life with a program like Renatus.

So that’s the reason we invested in it, and we’re constanly getting updates on the latest strategies, working in private masterminds, and networking with other investors in the community both within renatus and outside of renatus.

I encourage you to check it out, do your own research, and connect with me if you’re interested in joining the community and receiving the same high quality education we have access to 24/7/365 with updates for life.

Now if you want to market and refer people to the program what would that look like?

Well you can expect to place 200 signs a month, get 50 leads and have 1–2 of them convert into a sale.

Of those 1–2 people who are ready to start learning how to invest in real estate correctly, you will average between $300 and $3,000 per person signing up (and that’s for 2 people by the way).

So let’s say the average referral paid is $800.

$800 / $300 = 2.667 ROI.

Now if the person you refer wants access to the complete investor training system you’re looking at $11,200 or a 37x ROI on your money, not bad if you ask me.

Without making this a pitch for Renatus, you might be asking “yeah but how can they pay out 1/2 of the money they collect?” and thats easy.

They don’t pay for billboards, TV, radio or ad network placement.

It’s all word of mouth and through affiliates and folks who have the education.

And no you don’t have to purchase the education to refer people, but it helps.

That Being Said…

You decide how you want to invest in real estate, but I’ve decided and I’m positioned to run my businesses to facilitate lifestyle independence, how about you?

Christian “Cri” Childs

“The Real Estate Challenge Solver”

p.s. if you’d like to learn more about renatus or would like to signup for free email updates about real estate, investing tips, and other stuff that can help you launch a successful business check out http://eepurl.com/new-investors

If you want to learn more about our investor education system at Renatus then check out https://millennialreigroup.com

I look forward to helping you on your path to success and financial prosperity.