The steps you need to take to make $1 million in real estate.

What do you need to do if you want to make $1 million in real estate? There are a couple of options. One is to marry someone who has already made $1 million in real estate, but that’s not something that I’d recommend. Another option is to make $1 million yourself.

To start with, you need some money. You can scrape together some funds and save up for a down payment, which is typically around 5% to 10% of the property’s price. In the current market, the average house in Phenix is priced at around $400,000, so you need to prepare at least $20,000 to $40,000 for down.

If you’re a first-time homebuyer, you can take advantage of FHA loans, which will allow you to make a down payment of just 3.5%. This can be a good option if you have limited funds. Alternatively, if you have a wealthy relative or some other source of funds, that can help you get started.

Once you have the money for a down payment, a recommended approach for young and single individuals is house hacking. This involves buying a property and having roommates pay your mortgage. It can be a fast way to start building wealth in real estate.

“Work with a knowledgeable agent to have access to off-market deals and opportunities.”

If you want to find a great deal for your first property, it’s a good idea to work with a real estate agent. Contrary to popular belief, representing yourself may not lead to the best deal. Most sellers work with agents who can protect your interests and help you find good opportunities.

Engaging a real estate agent doesn’t cost anything upfront, and you can interview a few agents to find someone you trust and want to work with. Having a knowledgeable agent on your side can give you access to off-market deals and opportunities.

Once you have your money and your agent, the next step is to find a property and close escrow. Look for properties that have been renovated as they attract better tenants. Screen potential tenants thoroughly, checking their credit scores and rental history to minimize risks. We have a list of questions that you can ask tenants; reach out if you want a copy.

Also, you need to consider the cash flow potential of the property. Even if the monthly mortgage payment matches the rental income, it can still be worth it in the long term, especially if the property appreciates over time.

Additionally, you might want to consider buying multiple properties as it reduces the risk of vacancy. If one property is vacant, it’s a smaller percentage of your total portfolio, providing more stability.

If you have further questions or are ready to buy your first property, call or email us. We can provide you with guidance and assistance throughout the process.