Today, I wanted to share about how I got started in real estate investment.
I have a real estate investing goddess friend named Nicole. Her parents were very successful real estate investors. She grew up knowing all about real estate. Her parents are much older and have since retired, and now she runs their impressive real estate portfolio. She's been an investor since birth.
I, on the other hand, didn’t grow up knowing any of this. I fell into real estate investment almost by accident.
I didn’t know anything about real estate investing. I didn’t know why someone would want to do it, or that it was even an option for me.
I was taught that you work hard in school, go to the best college (and in my case law school) you can, and then get the best job you can.
I was taught to trade time for money, but get the best job you can so that you’re making the most amount of money per hour. It’s not bad advice if you’re money paradigm is that in order to make money, you need to get a job. The only thing I was taught about real estate was to buy my own home.
So that’s what I did. I worked hard in school; I went to Columbia Law School, and then I got a job working in a big law firm in Los Angeles. I was young, single, and making a good 6-figure salary. I was miserable in my job, but that’s a different story for a different blog.
After a few years of working and saving, I decided it was time to buy a house. It was Los Angeles in 2005, and we were getting toward the top of the bubble. Even though I had a 6-figure salary, it was hard to get a house I could afford in a neighborhood I wanted to live in. The “starter homes” I was looking at were well over $600,000.
A good friend of mine, who also wanted to buy a house but was stymied by the high prices, suggested that we buy something together. He suggested we buy a duplex and each live in one side of it.
I readily agreed. We’d been roommates together in law school and in Argentina. He was and still is one of my best friends. I knew I could live beside him.
We ended up finding a beautiful home that we both fell in love with. Unlike our original vision of one property with two equal spaces that each one of us would inhabit, our dream house had one unit that was substantially larger and more attractive to live in than the other.
My first real estate investment
Instead of one of us living in the less desirable unit, we decided that we would each take a bedroom in the bigger unit and rent out the top unit. There was also a converted garage in the back that we were able to rent out. We moved in, got tenants for the converted garage and the upstairs duplex. All of a sudden, we were landlords.
And I realized something — being a landlord had some definite benefits! These tenants were paying the mortgage! I still owed a little bit at the end of every month, but I owed a whole heck of a lot less than I otherwise would have if I owned the place by myself or if I had continued renting.
I was also seeing some major tax benefits! I got to take mortgage and other tax deductions that resulted in even better savings. I was in the highest tax bracket so owning this property made a BIG DIFFERENCE in my ultimate tax bill. I got to keep a lot more from Uncle Sam.
I liked this real estate thing!
It was when I realized that my tenants were paying my mortgage and I was saving money on my taxes that I realized real estate was a great way to go.
[In a future post, I’ll share how I acquired over 1000 rental doors in less than 1 year!]
Most people would agree that real estate is an incredible wealth-builder. Oddly, however, most people are not investing in real estate, and of those that are only a small percentage are women.
Which begs the question:
Why aren’t more women investing in real estate?
There are three main reasons I believe more women aren’t investing in real estate:
If that's you, I will cover all of these issues in the free webinar happening on May 15 at 6 pm PST called "How to Get Started in Real Estate Investing Even as a Busy Professional Woman."
In the How to Get Started Webinar you'll learn:
Are you ready to get started in real estate investing in a way that's feminine, financially lucrative, and fun? If so, register for the free "How to Get Started in Real Estate Investing Even as a Busy Professional Woman" webinar! Click here to register.