Do most people really become rich from real estate?
I'm 20 years old and a junior in college, my dad told me that most real estate investors that have become millionaires didn't go to college. How true is this, is it really that easy to get a loan and invest in real estate? I've read 4 books on real estate and attended a few seminars so far in the past 3 months as well as seen a few properties with potential for profit. The concepts seem pretty easy, the only thing I see is that its a lot of hard work. My dad has one rental property and my uncle just got one and it looks quite easy. Don' get me wrong, I know I have to roll up my sleeves and sometimes you may not make a profit for months and that's if you make a profit at all, but I want to know from someone who has experience, given the time and effort, could somebody strike it rich off real estate more easy than other fields? And is it more possible for any person who makes the effort or only few people have that special talent?
I would definitely love to work for my self.
- loanmasteroneLv 74 years agoFavorite Answer
Any education you obtain is a plus in any career field you would want to enter. You learn disciplines and educational techniques that would benefit you in any business you decide to enter. If you are planning to become a real estate investor, you might want to lean toward business subjects and math disciplines.
In any investment, you are making a long term commitment. being a real estate investor is not an easy task. You are required to know when to purchase and hold property, or when to purchase and flip or do both to maintain investment capital and holding investment property for tax advantages and passive income.
These are skills you would learn and develop over time and with experience.
Getting rich in real estate investment is relative. What do you consider rich? Your net worth would be determine by your real estate assets and the income you would earn,as well as the cash you would have on hand.
As far as having money to invest in real estate, you would do this with your earnings from your real estate investments. This is done over time.
It is sort of like investing stock. You take your gains and reinvest in more stock. You do the same in real estate investing, you take a portion of your gains and reinvest in the purchase of your next investment.
Once you have established yourself as a proven commodity, there would be plenty of capital available to you, that is not your own money. There is no individual or financial institution that would invest in a person that have not proven themselves to be able to be financial sound and worthy of financial assistance. You would apply and e approved for a business loan. These loans are based on your ability to repay them and the strength of the entity you would use as your investment vehicle
Many real estate investors have established a relationship with private investors and banking institutions that supply them with the necessary funds to invest in the purchase of real estate properties. These real estate investors, do not get a loan for each investment property
First of all you will have to educate yourself in the business you would want to be successful in. Therefore you would need to go to your favorite book store and buy as many books about investing in real estate as you can.
Buy and read as many books as you are able in order to learn the various investment vehicles and techniques used to obtain these investment vehicles.
There are many type books available, so you can get an idea which end of the real estate investment spectrum you would like to be involved in.
The books will give you ways of raising money for real estate investments, as well as an idea as to which investment you would like to pursue.
#2. Real Estate Investment Group
Join a local real estate investment groups.
Being a part of the local real estate investment group would give you first hand knowledge of individuals that have purchased real estate investment properties. You could possibly find a mentor that would assist you in the buying of properties. The real estate investment group members would validate the information you would learn in your books.
This group would also be instrumental in informing you of alternative means of obtaining investment funds.
There are many techniques where you would need little if any of your money to purchase properties to flip or use a rental to get passive income. You would learn how to use the :subject to the existing mortgage loan, controlling the property with a few hundred dollars and wholesale it to other investors.
Making a contract that allow you to do the rehab work, and not paying on the mortgage until the rehab work is complete and you would then pay anyone you owe once it is sold.
You would have to Google for this real estate investment group followed by the city and state in which you reside and/or want to invest.
Normally you stick to an area you are familiar with in the purchase of investment properties. there might be a time when you would expand your business, however in the beginning of your real estate business you would want to remain local.
I find attending seminars helpful, even if you are a very seasoned investor as you would learn the updated
techniques and technology used in real estate investment. You are also able to meet individuals that have same interest as you and you are able to make business contacts and exchange ideas and theories that might help you in your business.
I hope this has been of some benefit to you, good luck.
- BarkleyLv 54 years ago
NO, most people do Not become "rich" from real estate. When anything sounds too good to be true, It Is. And No business loan is ever easy to get. It takes money to make money. And most sound investment opportunities take time to pay off.
Focus on getting a good education instead of spending money on these "seminars". If you are that interested in the real estate industry, find employment in areas like construction, property management, real estate sales. Learn what really goes on. Practical experience is always helpful. Universities also offer programs in this field.
- 4 years ago
It is easy money but if you learn about it then apply it. Know what property can bring in cash flow, but sometimes don't even think about the cash. Build relationships with your clients. Try getting a real estate license or take your test, they will train you. But although you don't need a license to flip homes, a lot of company still teaches you. Like keller williams, Berkshire, coldwellbanker. I am a sophomore in college, im doing the same thing you're doing. Lol reading upon it and also i hear alot of wealthy ppl talk about it alot because I work as a server at this fancy restaurant. But good luck
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- chrisLv 64 years ago
You r best bet is to get some work experience in the field and finish your degree. If you like real estate, take some business courses. You can also get your real estate licesne pretty easily suring the down time of your schooling, IE - holiday, summer etc. Take the test and you are ready to go. FRom there you can work as a property manager, or work for an agent. Property mgmt is the best view of the fees, costs and profits of a property. It will open your eyes, to those you are doing a great job, and those owners who jsut can't hack it. best of luck!
- shipwreckLv 74 years ago
You don't strike it rich you get rich very very slowly. Getting started for most is very hard, first you buy a house to live in then try to buy another to rent out but you can't get a second loan. So you might move out of your house and rent it out. First time landlords make a lot of mistakes like trusting judgement about people instead of background checks and credit checks then when the tenant doesn't pay listening to excuses instead of starting evictions, most quit at that point.
If you learn the landlord business you will be negative cash flow for years. Buy a house with say 1,000 mortgage and rent it out for 1,000 and you still have to pay for repairs and cover empty months etc. Raise the rent every year and in about 5 years you might break even so you support the rental house from your paycheck and save for a second rental. You can refinance if prices are up and refinance your home to get a down payment on a second rental. You might be 10 years into landlording before you have any profit monthly but if you were to do nothing else but buy and hold a few rentals after the mortgages are paid down or even before you will have cash flow and raise the rent every year.
I know one couple who started with a run down 2 bedroom house cheap who now have 50 rental units but it has been 30 years not get rich quick and they and their children worked a lot of time cleaning and fixing things. They both work full time dealing with the rentals now.
- JackLv 64 years ago
Most real estate "investors" do NOT become rich. Most learn rather quickly that they are either losing money or earning a pitiful return.
The ones who "become rich" certainly have made good business relationships ("contacts" as you have called them), but they also have other very real skills - - and work rather hard to select, negotiate, finance, maintain, and sell their investments.
A successful real estate investor will have working capital, excellent credit, negotiation skills, the ability to assess an investment, knowledge of applicable tax law, be able to make quick decisions, understanding the market they are in..... It's not so easy.
- troLv 74 years ago
people who have made money in real estate may or may not have had college education,which regardless of what you do to work in life, is never a waste of time, it does teach you some very valuable information
making a fortune in real estate probable depends on when and where and how much, how much money you have to invest, when the market is good and where you manage to get hold of property
people who make it in real estate have a good 'eye' for the market, and college won't teach you that
- Cathi KLv 74 years ago
No most people don't. Some people do. Some get rich writing and selling books about getting rich. I make 7.5% interest off a REIT without the hassle of buying property direct.
- glennLv 74 years ago
I bought my first house in 1978. The family home we lived in. I bought my first investment house in 1983 with my brother. We now own an office building and three houses. My half of the properties is probably worth about $600,000- not rich but ok. If you take a lot of risks or get extremely lucky you may make much more.
- geraldLv 74 years ago
if it was so easy why are there so many people not rich believe me they are not all idiots to be rich you need to be an as**hole simple as that everybody isn't, the rich would never win a war no honour whatsoever sell granma for $10 blunt but true so make your mind up the devil or humans