Real Estate Investing – Where To Start?

By: Bill Plasha & Bob Wiley
Prudential Patt, White Real Estate

Most real estate investors get started buying single-family houses, probably because it’s what they are the most familiar with. But whether you’re going to start small or head right to the big time, here are a few things to keep in mind.

Think big! If buying a 5-unit apartment building requires you to get commercial financing, which is a whole different “animal” than the mortgage you have on your home, then why not make it worth your while? Go for a 10-unit building. Remember that the more units you buy, the cheaper they are per unit.

Give it time! Commercial deals take longer than single-family houses do. They take longer to find, finance, renovate, and get sold. This isn’t a bad thing, but something that you need to keep in mind so that you don’t get impatient or rush into a bad decision. Think of commercial deals as a long-term income, not a quick way to pay the bills.

Don’t get discouraged! If you haven’t done your first deal yet, or if you are spending more time per deal than your previous ones, just hang in there. Commercial properties aren’t in cookie cutter developments like single family homes and it will take longer to find the investment that’s right for you. Just remember that there’s a learning curve and things will go faster over time.