HOW TO GET INTO REAL ESTATE INVESTING AT 18

If you’re young and don’t have a lot of money or experience, you might be wondering if real estate is a good place to start. Real estate is not for everyone! Don’t do this at all – wait until your student loans are gone (and maybe even get some kids) before jumping right into such an expensive purchase. I am joking, of course!

Real estate can be a great place to start investing, even if you don’t have a lot of money, you are young and have no experience. Moreover, the earlier you start investing into real estate, the more time you have to let your investment grow. It’s simple mathematics really.

Suppose you start investing in real estate at age of 18. You buy a property for $100,000 with a 5% down payment, 30 years fixed mortgage, 6% interest rate.

Closing costs plus initial down payment: approximately 10% of the sales price $10,000

Monthly rent to be collected: $1350

Cash flow: $441-monthly; $5292– yearly

If you reinvest cashflow with 9% and continue to reinvest cashflow for ten years, the value of your initial investment will be $92,929 ($174,654 in 15 years; $791,552 in 30 years; $3,621,211 by the time of retirement). Not bad, right? However, the picture is even better! After 30 years your investment property will be paid off and cash flow will increase dramatically! So, if you continue reinvest your cashflow after the mortgage is paid, then you will have on your bank account an amount of $3,891,415

The value of the house will increase according to inflation and other factors. The average annual appreciation is 5%, so, when you pay off your mortgage (basically, when tenants pay off your mortgage) your house will cost $432,194 and $990,597 by the retirement age respectfully

Now, add $791,552 and $432,194 = $1,223,746 worth your initial investment ($10,000 when you turn just 48 years old! Millions of people just start investing at this age (never late, though))

And finally, by the time of your retirement, your initial investment will worth $4,882,012!

That’s the power of compound interest and smart investing strategy! You do not need deep pockets or Ph.D. to start making money in real estate. All you need is to be disciplined, have a plan, and execute it! That’s the beauty of real estate! You can start small and grow big!

 Ok, how to get into real estate investing at 18?

Of course, there are many other factors that can affect your investment, such as the type of property you choose to invest in, the location of the property, the condition of the property, the rental market in the area, and so on. But, if you do your homework and invest wisely, the rewards can be great. So, if you’re young and looking to get started in real estate investing, don’t let lack of money or experience hold you back. There are plenty of resources out there that can help you learn more about investing in real estate.

Here are some ideas of how to get started with limited money resources and knowledge:

• Get a job with a real estate company! This is a great way to learn about the industry and get your foot in the door. Jobs such as being a real estate assistant, working in property management, or even being a receptionist at a real estate firm, can give you the opportunity to learn about real estate investing and meet people in the industry.
• Start with a real estate license! In order to get a real estate license in the United States, you must be at least 18 years old. Each state has different requirements for getting a license, but most states require you to take a certain number of classes and pass an exam.   If you’re serious about getting into real estate investing, a license will give you the ability to learn more about the industry and network with other professionals.
• You could also look into joining a real estate investment club or online group, which would give you the chance to learn more about investing in real estate and connect with other like-minded individuals.
• Participate in a crowdfunding deal! There are now many platforms that allow you to invest in real estate deals with other investors, without having to put down a large amount of money yourself. This is a great way to get started in real estate investing with less risk.
• Get into the real estate wholesale business! You could look for deals on Craigslist, Zillow, Redfin, etc., and then find cash buyers who are looking for properties. You don’t even need a license to wholesale real estate or lots of cash, however, you can make lots of money and learn real estate investing skills.
• Invest in a REIT! A REIT is a real estate investment trust, which is a company that owns and operates income-producing real estate. REITs are traded on major exchanges, much like stocks, and can be a great way to get exposure to the real estate market without having to buy or manage properties yourself.
• Fix and flip! You could find properties that need some work, put in the sweat equity, and then sell them for a profit. This is a more hands-on approach to real estate investing but can be very lucrative. Also, if you do not have or don’t want to spend your own money – find an investor! When you spend some time working in the real estate industry – you will realize how many people are ready to invest their money and hungrily looking for a good deal.
• Become a landlord! Become a landlord after you have saved money for a down payment and can cover all expenses associated with the property. Owning real estate will make you wealthier in the long term.

Starting real estate investing young gives you an incredible opportunity to build infinite wealth strategies, such as:

1) You have time on your side: as we age, our ability to take on risk declines. When you’re young, you can afford to take more risks, because you do not have obligations like kids, family, personal credits, student loans, etc.

2) Social expectations:  as we grow older, peer pressure and social expectations change. When you’re young, you have more time to focus on your goals without the same level of social pressure. Let’s say it’s more acceptable live with your parents and save money for your first investment when you’re 18, than when you’re 30.

3) You have fewer personal and financial responsibilities: When you’re young and single, you have fewer financial responsibilities and more time to focus on building your wealth.

4) You have the energy and time to work hard to build your very first capital: This is the most important one. When you’re young, you have the time and energy to invest in your future. You can work hard to save money for your down payment or start a business to generate income for your investment.

5) You can take advantage of compound growth: Compound growth is the concept of earning money on your money. The earlier you start investing, the more time your money has to grow, which can lead to exponential growth.

Real estate is a great investment for anyone at any age, and the earlier you start, the better your results will be. Do your research to find the right opportunity for you and get started today! Have you ever invested in real estate? What was your experience like? Let us know in the comments below!