Get everybody. My name is Whitney Nicely and I’m going to tell you my first rental house because a lady sent me a question.
I think it was last night actually and she wanted to know how to get started in real estate.
Basically she wanted to know how she should buy her first rental house. And that’s like walking into the doctor’s office and being like hey am I sick.
I don’t know are you. You need around the world.
What kind of a house do you want me. I can’t just say oh you want a rental house will go do this this and this.
I need to know you need to talk to you. I need to ask you some questions I need to clear.
Kirby I need to like really understand what your goal is. If you want to Riddle house and you have a house then we might be able to rent that one you might already have a rental house is. Done with it. OK. Or you might have inherited a house that we could rent. You might have really really great credit and you might be a banker.
And then we can just use your connections and buy a house. I think that would be stupid but we could do it. OK. So what I want to tell you about is how I bought my first house and all the mistakes I made and the stupid.
Reasons I bought this house again it was ridiculous so if you want to know if you should buy a rental house. My answer is yes.
Should I buy a rental house. Yes. OK. I think everybody should have five or 10 or 15 rental houses whether you’re a good manager. That’s up to you whether you’re actually making any money that’s up to you. I can’t do that. But on the surface I feel like I mean I feel like everybody should have a car. But if you live in New York City that’s probably not a good idea. A great but this is going to be how I bought my first house.
And I met a so many rookie mistakes. OK so I bought my first house I bought my first piece of property at a foreclosure option which was really cool really fun.
It was a really big slam dunk.
And then I got into real estate house up OK because I like auctions. I think you can get great deals at auction. I think you can pay market value at auction. I think anything is possible in real estate. So because I was under the impression that you either had to pay cash for houses or you had to go get a loan and put.
20 percent. Down and finance it for 30 years.
Those were the only two ways that I thought you could buy houses when I started buying houses so I saw a sign in my neighborhood for a house option. I told my mama I told my brother I told my daddy and my boyfriend told everybody. I was going to this auction. Now not going to buy this house. OK.
So I went to the auction I had a high bid which was basically every penny I had in my life savings account. And when they got to.
I put in one last bid. I think at thirty one thousand dollars and the other guy that was bidding against me quit that he will be adding and I bought it for 31000 thousand which was a thousand dollars more than I had in my pocket.
And that was the only way that I knew how to buy houses and I figured that I live in this neighborhood I know how much I pay I kind of know how much my house is worth.
I know how much my neighbor’s house is worth. Surely we could rent this thing for a thousand dollars.
I had no way to check. I had no way to find out about the school I had no way to find out if that was even going to make me any money.
But the only thing I knew was I wanted to buy a house and I wanted to be a landlord and I had this much money and it was in the right neighborhood and I could handle it.
That is so scary like thinking back I think that was summer of 2012.
Thinking back on that terrifies me like how anybody could go into a real estate deal and not know what they were going to do and if their numbers were right and if they were going to make any money like that terrifies me and people do it all the time.
People do that all the time. They jump into houses that they don’t know if they can afford. They don’t know if it’s going to make any money they don’t know how they’re going to get out of it they don’t know how to fix anything. They don’t know anything about collecting rent. They don’t know how to write a contract.
They don’t know anything and they’re just like oh well I know a couple of guys that do this.
They seem to be doing good so I can do it.
Not. OK. A year later when I figured out what was going on and I’ve written the house for $800 and I had no idea about paying taxes and insurance I guess I just thought I’d pay those out of pocket not worry about it coming out the rent. And a year later and I knew how to do these options I knew how to do owner finance and at that point and we’ve sold the house on lease option for $79000 they do pay me a thousand dollars a month now and I got like eight thousand dollars down. We had to extend their lease option deal.