In this discussion, I share EXACTLY what I look for when investing in real estate. This comes as firsthand experience of my own investing strategies, both from what I’ve learned as a landlord of multiple rental-properties and as a high-end Realtor.
Learn how to make money as a Real Estate Agent, build your network of clients, and the exact steps I’ve used to grow my business from $0 to over $120 million in sales: $50 off with code ThankYou50 for a limited time: https://goo.gl/UFpi4c
Since clickbait sucks…here’s the entire video summed up:
1:00 - Loan options. I generally recommend a residential loan and sticking with 1-4 units. After 4 units, the loan is considered commercial and carries a higher interest rate, higher down payment, and more qualifying restrictions.
2:12 - Single family residence vs multi family building. I generally prefer multi-family residences, but be wary of future rent control restrictions depending on your location and city regulations. I also explain how to live for free - live in one of the units and rent out the others. Generally this will cover almost all of your costs. Free housing!
4:40 - Conventional vs FHA loan. I prefer a conventional loan over FHA, as convention loans have lower fees, lower interest rates, and generally offer better terms than an FHA loan. FHA loans could work depending on your situation, but it ultimately comes down to the term and interest rate of the loan.
6:53 - How I search for properties. Everything I find is through the multiple listing service (MLS). I personally like to see everything as soon as it comes on the market, but I also look at properties that have been on the market awhile as they might be more flexible in price.
10:55 - What times of homes I look for. I personally go for homes that just need cosmetic remodeling. Kitchens, bathrooms, floors, landscape, and paint are very easy to do and doesn’t take a lot of time to do. It also adds a lot of instant value by remodeling these areas - plus, many buyers overlook homes that need minor remodeling.
12:57 - What areas I invest in. I invest in areas that are surrounding other high-priced areas, since development generally moves outwards with time. I do my best to predict the next “boom” areas where development and business money is moving in.
15:15 - How i calculate if a home is a good investment. I like a mix of cash on cash return and appreciation. In addition to this, I like a home where I can add value through cosmetic remodeling. This way I make an immediate return on equity, I can make some passive income from rent, and future appreciation on the home’s value.
20:30 - What area I like to buy in. I make sure the home isn’t on the same block as an apartment building, a business, a busy street, or a street with speed bumps.
21:40 - How to calculate your rents. I like to use craigslist to compare what other units are renting for.
22:30 - Out of state investments. Personally, I wouldn’t do it.
23:11 - Is a property manager worth it? Sometimes - I don’t really use one, but I would in the future.
24:50 - BUILD YOUR CREDIT SCORE. This is so important.
Add me on Instagram: GPStephan
Add me on Snapchat: GPStephan
Suggested reading:
Your money or your life: https://goo.gl/fmlaJR
The Millionaire Real Estate Agent: http://goo.gl/TPTSVC
The Millionaire Real Estate Investor: https://goo.gl/sV9xtl
How to Win Friends and Influence People: https://goo.gl/1f3Meq
Think and grow rich: https://goo.gl/SSKlyu
Awaken the giant within: https://goo.gl/niIAEI
The Book on Rental Property Investing: https://goo.gl/qtJqFq
Learn how to make money as a Real Estate Agent, build your network of clients, and the exact steps I’ve used to grow my business from $0 to over $120 million in sales: $50 off with code ThankYou50 for a limited time: https://goo.gl/UFpi4c
Since clickbait sucks…here’s the entire video summed up:
1:00 - Loan options. I generally recommend a residential loan and sticking with 1-4 units. After 4 units, the loan is considered commercial and carries a higher interest rate, higher down payment, and more qualifying restrictions.
2:12 - Single family residence vs multi family building. I generally prefer multi-family residences, but be wary of future rent control restrictions depending on your location and city regulations. I also explain how to live for free - live in one of the units and rent out the others. Generally this will cover almost all of your costs. Free housing!
4:40 - Conventional vs FHA loan. I prefer a conventional loan over FHA, as convention loans have lower fees, lower interest rates, and generally offer better terms than an FHA loan. FHA loans could work depending on your situation, but it ultimately comes down to the term and interest rate of the loan.
6:53 - How I search for properties. Everything I find is through the multiple listing service (MLS). I personally like to see everything as soon as it comes on the market, but I also look at properties that have been on the market awhile as they might be more flexible in price.
10:55 - What times of homes I look for. I personally go for homes that just need cosmetic remodeling. Kitchens, bathrooms, floors, landscape, and paint are very easy to do and doesn’t take a lot of time to do. It also adds a lot of instant value by remodeling these areas - plus, many buyers overlook homes that need minor remodeling.
12:57 - What areas I invest in. I invest in areas that are surrounding other high-priced areas, since development generally moves outwards with time. I do my best to predict the next “boom” areas where development and business money is moving in.
15:15 - How i calculate if a home is a good investment. I like a mix of cash on cash return and appreciation. In addition to this, I like a home where I can add value through cosmetic remodeling. This way I make an immediate return on equity, I can make some passive income from rent, and future appreciation on the home’s value.
20:30 - What area I like to buy in. I make sure the home isn’t on the same block as an apartment building, a business, a busy street, or a street with speed bumps.
21:40 - How to calculate your rents. I like to use craigslist to compare what other units are renting for.
22:30 - Out of state investments. Personally, I wouldn’t do it.
23:11 - Is a property manager worth it? Sometimes - I don’t really use one, but I would in the future.
24:50 - BUILD YOUR CREDIT SCORE. This is so important.
Add me on Instagram: GPStephan
Add me on Snapchat: GPStephan
Suggested reading:
Your money or your life: https://goo.gl/fmlaJR
The Millionaire Real Estate Agent: http://goo.gl/TPTSVC
The Millionaire Real Estate Investor: https://goo.gl/sV9xtl
How to Win Friends and Influence People: https://goo.gl/1f3Meq
Think and grow rich: https://goo.gl/SSKlyu
Awaken the giant within: https://goo.gl/niIAEI
The Book on Rental Property Investing: https://goo.gl/qtJqFq
Is this a good investment to start with as a first timer in the real-estate market?
I’m really excited to get into real estate, I enjoy the informational videos you bring to the public. Someone who is willing to share the deets of their career is someone who can be trusted. Not many are willing to share tips and secrets of a specific market because of the competition it could bring, but you’re a good man Graham.
Landscaping gets wayyy too expensive a lot of times if you want it done right. Source: me 😢🤣
“SunCor Financial MPI review”
DAMN GREAT INFO! I live in LA and recently caught an interest in Real estate. I'm working on getting my real estate license and hopefully learning the business while employed in the industry.
❤❤❤❤❤❤🛎🛎🛎🛎🛎🛎
Hey Graham!! Where else can I look for property besides on MLS since I'm not a real estate agent? I want to be able to find some properties on my own besides using my agent. THanks in advance!
Great video authentic
Great Video Graham, by the way you misspelled conventional when you were talking about the loans.
One of your best videos
I'm so tired of seeing that one kid who CLEARLY hasn't made a dime of his own money and CLEARLY just started high school last fall tell me how to make MILLIONS of dollars in the ads. You can just tell he's lying and he speaks WAAAAYY too fast. He doesn't seem confident or articulate.
your monthly expenses is $4000 but $1100 is used to pay the principle amount, thats a return? although thats kind of true but its weird to calculate this way because its not extra cash flow into your pocket. can someone please correct me if im wrong?
Hey Graham what are you thoughts on BRRRR investing?
What do you think about home warranty’s? Do you have any or is it just better to get to know people around (electricians, Plumbers, ect) I currently have home warranty and pay 500 dollars a year, anything goes wrong and obviously with a deductible they will take care of it! Let me know what you think!?
Oh, almighty YouTube algorithm give Graham more views with this comment
Would you recommend using an FHA for someone who is a First-time buyer for a multi-family who does have a 710+ score? This was a great video! Quality questions indeed!!!
Amazing video – I loved your practical advice in this Graham. I want to see more stuff like this! I'm in the same position as your guest on this show – looking at areas under $500k around LA (like Lancaster, San Bernardino, Santa Clarita, Simi etc). but I'm open to out of state stuff: particularly in Mesa AZ, Maui, Texas (the big cities), Denver, and SLC.
I enjoy watching your vids while i'm having some tea. 💯
Looking back, you definitely should've used one of those Dave Ramsey headsets for this lmao
There was a part where it was said that ideally you want a property that gives a 6% to 8% return. I understood all the video in except that. What is that return based on? How do you calculate it?
Why do you recommend putting 20% down? I know Bigger Pockets recommends using an FHA loan to put down the least amount possible with multifamily investing.
Hey Graham, I love your content and just recently developed a passion for real estate. Sooo many things i learned growing up did NOTHING to help me financially and virtually teach me to work paycheck to paycheck cuz the "man" is against us and you cant make it anywhere in the system. I always wanted to break this and you have helped me so much… After following you for awhile i kinda get a weird vibe from this video. Every time your student presents something, you give off a body language tone that your very unhappy with the thought presented or your better than that. I'm not sure of your prior relationship but it sends a weird message. I like your image video and maybe that RAWness got to you.
All in all Your content is life changing, Thank you for providing it. I am currently chasing my licence due to you
Hey Graham, can you tell me what's your take on taking a loan for starting my real estate business, I'm from Trinidad?
Hey Graham! Would you mind elaborating more on FHA loans I’ve got $20k and a 700 credit score.
Hey thanks for alllllllll yr videos it has been a great help for me.
Awesome vid
Hey Graham great video! , I have one question. You said that you look through MLS for buying opportunities but I am not a Realtor. Which website or platform do you recommend to find rental property deals? or should I get my real estate license before investing in real estate?
Hey Graham, So I purchased my first home last year and I am using it as a rental property. I want to get into buying properties but I don’t have any substantial income saved for purchasing, recently I saw a 12,000 dollar house with 4 bedrooms and I got very excited and got a personal loan to purchase it….fast forward a week, they snatched the house from me… and I was thinking of keeping the loan just in case another one came up… since they come around often In my area. Do you think it’s wise to get any kind of loan to purchase rental property. Btw I am deathly afraid of loans..which is why school is a no for me.
hi graham can you please mentor me?
Graham, FANTASTIC video! Thanks for sharing. Having read through some of the comments below, I can see why you get a sense of fulfillment posting these video — lots of people can use your knowledge! 🙂