If it were easy, then everyone would be doing it.
In my opinion, nothing comes without hard work and sacrifice. So, if you want to make money in real estate, you better be willing to work hard and sacrifice pretty much everything. I did exactly that. I moved from Australia to Kansas City, of all the places. I only had $15,000 in cash and bought a D-class property for $9,000. I renovated it for $4,000, so I was into the deal for a total of $13,000. Then I turned around and sold that property for $27,000. That was one of the first deals that I ever did in the U.S. real estate market.
Where Can I Find Affordable Deals?
Now, you’re probably thinking, “That’s great, but how do I do that in my area because there are only $500,000 properties?” Again, nothing comes without hard work and sacrifice. So what you need to do is pack up and move to a market where the numbers make sense. I’m sorry, but there is no other way to put it. I know a lot of you are living in very expensive markets where the average house price is $200,000 and up. I just don’t know how you can make money in those markets. I don’t believe in using a ton of leverage, and I don’t believe in doing creative development-type deals where you need to do a full-blown structural rehab to a property, involving a lot of people. That is too many people in the mix, and people equal problems. You want to control your destiny and be the master of your fate.
If you have $20,000, you should find distressed assets. Get really good at negotiating and develop patience. Having patience is the key to finding the right deal. Never pay more than you need to because when one door closes another one opens. So be patient. Find a distressed asset, preferably in the Midwest because there are a lot of cheap properties there. You’re probably not going to be able to get an A or B-class property; you’re probably going to have to go into a C or D-class property, but that is not the end of the world. You need to learn somewhere, and the lower the…