Christian Osgood explains how to start real estate investing with minimal money by building reputation first, then using seller financing, private capital, or cash flow from side businesses to fund renovations. He recommends working with brokers on creative deals and reinvesting property earnings to force appreciation without upfront cash.
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Hello and welcome back to Whiteboard Wednesday. It is a solo Christian week, however, this is an excellent week, so don't skip because we are going to go over how to do renovations and where all the money comes from when you're buying no-to-low money down. How do you then improve a building when all you have is cash flow to work with? If you haven't already, like and subscribe. We're going to dive right in right now with our first question. This is from Brody. Brody's 16, runs a couch flipping business, making $1,000 to $1,500 a week. So first of all, Brody, way to go make money while you're young. That is going to be really helpful. That hustle is awesome to see. The actual question is, hey, I want to buy multifamily, but finding loans is hard when you're 16. What can I do to prepare to buy multifamily when I turn 18? Well, first of all, you are learning skills today in your couch flipping business that is really going to serve you well. So keep hustling, keep grinding, learn how to run your business as efficiently as possible. The most important thing you can do for real estate right now is learn. Books, courses, events— events are great if you can go meet some other owners and people who own real estate today. Get your name out there so when you turn 18, people have an idea who you are in your market. That is going to be powerful. At the end of the day, gather the information because application is more important than information. But if you have no information, you have nothing to apply. So learn as much as you can, meet as many people as you can, it's going to take you extremely far. Next question is, is $50,000 enough for me to start investing? Well, that's an excellent question. For myself, I started with $100,000. I'd saved up for 7 years to get there in a sales job. Brutal grind for me. Really blessed to start with that much money. Cody started with $3,000. Well, $50,000 is about exactly in the middle of that. So the short answer is yes, absolutely. A common misconception is that you need a down payment or you need to have money to to go buy real estate. Creativity follows commitment. If you are committed to buying real estate, you absolutely can do this. It's gonna take creativity, and the less money you have, to be clear, the harder it will be to start. I've talked to a few people who have money, and they reach out saying, "Hey, how do I invest with no money? I don't wanna risk any of the money I have." That's the wrong way to look at it. You should be investing in real estate, which means taking what you have and placing it towards your goal. If you have money today, invest it. Have it start working for you. Dollars are going down in value rapidly right now. Real estate's a great hedge against that. Put your money to work. But when you're out of money, you still need to take what you have and apply it. If what you have is time, put that in instead of money. If what you have is a business with cash flow, Well, apply that cash flow towards investing in real estate. But take the pieces you have and invest in. $50,000, absolutely enough. Question number 3: Do you prefer seller financing with some private capital for the down payment or borrowing against your equity? Well, this plays right into the last question, actually. Play with what you have. Cody and I don't really have a preference. If we're buying a deal zero down, if I don't have money money for a down payment in an account. Well, then we're going to need to go raise it. So seller financing with either a partner or additional debt, depending on how we want to structure it. But raising the down payment and seller financing a deal, awesome way. That's how we bought a vast majority of our real estate, because after my first 4 units, I was out of money, and Cody had already invested everything he had in real estate. He started with $3,000. So We've had to go from zero down. We did a lot of the seller financing and raised down payments. That being said, we just put a new roof on one of our buildings from the equity already built in that building. We're able to get a loan against the building, pull the money out, and put it right back into the property. So short answer is just depends on how the deal is. There's a lot of creative ways beyond that that we're more than happy to use. At the end of the day, whatever best fits that deal and where we're at today is what we will do. No preference whatsoever, but great question. Question 4: When I ask brokers if the deal is seller-financable, they almost always say no. Should we be going around them trying to meet the owner and ask the owner directly? No. On this one, solid answer. If there's a broker involved, an owner has hired this person to do a job. You are disrespecting that relationship if you go around the broker to the owner who put them in place in the first place. So if you have a deal, what you're going to find is a lot of brokers, a lot of them, not all of them, but a lot of them don't know seller financing. They don't know how to be creative because a lot of brokers are not investors. Now, there are some awesome brokers who have a lot of investing experience or have really pushed creative financing forward and helped their clients buy no and low down deals. Those are the brokers you want to be working with, and we have a few in our arsenal who are phenomenal, and they know how to put these things together. We just started working with a broker who actually started by coming to us with a seller-financable deal. In our market, excellent deal. We went under contract within about 24 hours of our first phone call. Find brokers like that. If you're just going after listed properties online, you're gonna have a hard time, 'cause that's what everyone else sees. That is why we present so much on how to meet owners. You wanna meet the owner before they give the property to the broker, before it's marketed. You wanna build that relationship. Don't come in after the fact and get around a broker, though. That's a violation of that relationship. It's not the right way to play the game. That deal might just not be seller financeable the way it's out there. Lastly, where do you get the money for renovations to increase cash flow? Excellent question. A lot of our properties and a lot of our methodology is, well, you buy a property that's under market rent and you do some repairs and you make the building better, you increase the value, force appreciation, and you can make millions of dollars in real estate. This is how Cody and I did it. However, where does that money come from? If you're going in zero down, you raise the capital, say you have a 12-plex that cash flows $1,000 day one. Well, $1,000 doesn't buy you a new roof, and $1,000, it just doesn't go that far. So for us, the money can come from a few places. One, when we earn income, we spend it on repairs. Like, that's, that's where my earned money comes from. We have a little bit of money that comes in from our education platform, a lot more money that comes in from the little bit of brokering we do. But all that money, 100% reinvestment into the property. So it's not like we don't spend what we have. You have money in, it has to go somewhere. Might as well be towards your future. In addition As you have a property, if you buy something that's stable enough— because you don't want to buy something that's just no cash flow, total dog, and you have to bring it to life, that's expensive— but you bring a property that's cash flowing, that's operating, and it might need a little bit of love. Work with that property, do basic repairs, build the community up, lease to better tenants, or help the tenants that you have, keep the good people. And enhance your community, slowly raise rent a little bit. As the value of your building gets pushed up, you're going to have the opportunity to borrow against your building again because now you have new value that is created. That is what we did for our 12-plex, and that's why this video is one day late. We were out there watching the trusses get put on our roof, paying contractors, but the 12-plex that Cody bought a few years ago just bought itself brand new roof, a brand new coat of paint, some new appliances, and we're working on getting a fence around some of the units so it just looks a little nicer, a little cleaner. But we took a property that was decent place to live but an ugly building, and we're making it a really pretty building. A few hundred thousand dollars renovation, but it's a gorgeous building. That is how you improve a building when you buy at zero money down and you don't have money to to improve it. You buy a cash-flowing asset and you give it the time to pay for itself. So I hope this video was helpful, and again, apologies for being late. If you haven't yet, like and subscribe. Whiteboard Wednesday is our favorite day of the week. Include any and all of your questions down below in the comments. Let us know if there's anything we can improve here, and we will see you on Friday.
