How I Built a $500K/ Year Real Estate Investing Business
Courage. Commitment. Persistence. Massive Action
How Long Did it Take to Get to $500,000 in a Year?
We did 500k+ in our 4th full year. It was really my 3rd year of working full time. The first full year I was still running my art businesses for part of the year.
We also went over 400K the year prior.
Why Real Estate Investing?
Money. I spent most of my adult life prior to starting a real estate investing business as a musician and an artist. I was ready to make “real” money, big money. Real Estate Investing seemed like a good path to get there- high potential upside in terms of income.
How to Start a Real Estate Investing Business?
First I had to pick a strategy out of the many “sure paths to riches” being touted by gurus on the internet. It can be easy to get caught up in “shiny object syndrome” and to move in multiple directions at once, which can be counterproductive.
I learned that picking one thing and sticking with it was probably the best course. I learned this after pursuing multiple options- wholesale house deals, subject to, land deals, apartments/ commercial and others.
What Are the Options?
There are lots of ways to invest in real estate- here are a few:
- Wholesaling/ Assignment of contract deals
- Residential single family, multi-family
- Vacant land- building lots, acreage, commercial
- Subject to deals
- Flipping
- BRRR- Buy, Renovate, Rent, Refinance, Repeat
- Rental property, buy and hold
- Novations
- Etc.
Pick one to start, get good at it, then add more tools to your tool belt.
How Much Money Did I Start With?
Zero.
I did my first deal with 0 out of pocket and made 17k at closing. It was a Subject to deal. I later made another 40k on this deal for a total of 57k.
My second deal was a vacant land deal. I made $6,714 on that one. It felt easy, and I decided to pursue land as my niche.
With some creativity you can get money coming in with little or no money out of pocket.
Where Did I Start My Real Estate Investing Business?
From my tiny house in the woods on 3 acres of land. I had set up my lifestyle so that I could support myself as an artist with minimal overhead. This was also ideal for starting a real estate business. I didn’t have major household expenses or a mortgage to cover while I was figuring things out.
Also, the peace of the woods is a nice counter balance to the stress of building a real estate investing business.
Who Helped Me Start My Real Estate Investing Business?
I did it solo, but I also had a lot of help. My son Jasper had started 2-3 years before me, and he helped with some logistics, suggestions, and even shared some leads with me.
I took advantage of online resources. I studied subject to with a couple of different teachers, mainly William Tingle. I bought Jack Bosch’s vacant land course off of Ebay and studied it. Those were both very helpful. I also got into some Facebook real estate investing groups where I could ask questions and learn from some of the convos on there.
I joined my local REIA (real estate investor’s association) and went to some of their events.
My brother Derek came on board pretty early on, putting in some hours when he could outside of his day job. He eventually quit his day job and is now Managing Partner and head of dispositions.
Which Tools Did I Use?
I got Propstream early on because it was recommended by a few different people for researching and comping properties. It’s a good tool, but if you’re on a budget, I think you can get the same results with Propwire, GIS, and Zillow, for free though. Propwire was not around when I started.
We used Google docs and Google sheets and paper in the early days. I’d recommend getting some kind of a CRM to organize your seller leads, property info, business info, etc. You will accumulate a lot of data.
Landglide helped a lot, especially with vacant land- owner look ups, property boundaries, some info from the public records. $10 a month.
Pandadoc for e-sign documents. Free starter plan
Genius scan for scanning documents- free phone app. Has a fax function too.
That’s really all I used to get started. I added a CRM later, which was a game changer.
Getting Seller Leads, Marketing
How did I get my first seller leads? Guerilla style- free sources- Driving for Dollars, Craigslist, Facebook marketplace, Facebook Groups.
I graduated to pulling and skip tracing lists, and then used Direct Mail. This was my first big expense- I spent about $950 to send my first batch of 1000 direct mail pieces. It felt like a big risk at the time, but it paid off.
How Hard Was it?
Hard. I’m not going to lie. Getting over the hump and building momentum is one of the hardest parts of any new endeavor. With real estate investing, there is a learning curve, and there is pressure and competition. Faith, courage, persistence, and a new and improved mindset are required. Beginner mind too- being humble and being willing to acknowledge what you don’t know.
Putting in the Work- Making the Calls, Meeting People in person when possible, understanding contracts, building systems and a support network of lawyers, title companies, boots on the ground, buyers. These are some of the things you will need to take on.
Pressure- These are for most people, large dollar amounts that are changing hands. That can create tension and require calm under pressure to get deals across the finish line and get paid.
Competition- With the popularity of Youtube University and podcasts, lots of people are jumping in to real estate investing. It’s a crowded field, like the beginning of a major marathon. The trick is to stay the course, build incrementally your knowledge and aptitude, and separate yourself from the pack. Sellers are getting more and more people reaching out to them, so you need to be ready when you get your shot to make a deal.
Hiring and Building a Team- Who not How
Pretty early on, books like Who Not How, and The E-myth taught me that to be effective in business and to grow I had to be working ON the business, not IN the business.
I started by hiring a project-based VA for admin work, and shortly thereafter I brought that person on full time, and I added a second person because I could feel the impact they would have in freeing me up to grow the business. It’s hard to think bigger picture when you are caught up in the everyday busy work.
These days, highly qualified professionals can be hired off of sites like Upwork and OnlinejobsPH for as low as $4-5 per hour. This is not exploitative. In the markets that these workers are in, such as the Phillipines, India and Pakistan, Central America- this amount provides a nice standard of living. You can of course pay more and get higher quality players, but if you’re just starting out and have a low budget like I did, it’s a great way to get leverage for a relatively low cost.
Why not hire US workers? I did hire one US worker prior to trying international VAs. She did not provide quality work, was not reliable, and cost me way more. I have heard this From more than one real estate investor, including OG Matt Larson- that US employees have a worse work ethic and more of a sense of entitlement than VA’s from abroad. The VA’s I’ve worked with have for the most part been grateful to be part of a team and to have steady work and a positive work environment.
Create a Framework- Systems and Processes
Part of bringing people on board to help grow your business is having a roadmap for them to follow.
I learned early on to create a document for every task and process that I wanted to hand off.
Having solid systems in place for finances, lead generation, disposition, transaction coordination, and any other repetitive facet of your business will set you free and allow you to bring in and train team members.
When i was starting out, it was google docs. Now there’a AI and it’s sooo easy to create a process map on platforms like Loom.
How again?
So how did I build a business that’s making over 500k a year within a few years’ time?
- Picked a lane- one area of investing to focus on first
- Learned enough about the area I picked to get started- I bought a land investing course
- Took massive action- “Ready-fire-aim!”
- Added team members gradually
- Documented processes and built systems
- Persisted- “Ambition is the path to success. Persistence is the vehicle you arrive in” -Bill Bradley
Questions? Comments? Leave them below and let’s chat. I’m happy to help!