The 3 Essential Steps Before Buying Real Estate

Get bigger, get better, get stronger at your business. Keep scaling, and I promise you, you will be happy you did, and you'll move astronomically faster than those who add too many steps. Hello, YouTube. Today we are going to be sharing the steps you need to take before you buy your first property. Now, this is going to be way less steps than you think. It's going to be much simpler than any book or YouTube video that you've watched. People tend to overcomplicate this. We're going to make this ridiculously simple starting right now. So welcome back to the channel. I'm Christian Osgood. This is the simplest way to get into real estate to buy your first property without adding steps and without skipping steps. So first of all, the first thing that people miss, and this happens all the time, is they have not defined where they're actually trying to go with the real estate. Essentially, what is the real estate actually for? Now, someone who has not thought this out is not ready for this step yet. Usually sound something like this. Hey, I want to get passive income so that I have more money every month, or I want to get out of the 9 to 5 so I don't have to work my day job. Few problems with these goals. First of all, way too ambiguous. You're never going to hit them. You're going to get bored, discouraged when things get hard. You're not going to hit them. Two, they don't have a defined timeline. If you don't have a defined timeline, you're going to take forever to get there and you need to actually map out the right steps you really don't know where you're headed. An ambiguous goal like more time or not having to work, that needs some work. What it really should look like is, hey, I want to leave my job so that I can do X or Y. Could be travel, could be start another business. No idea. Those are going to be your goals, but you're going to map out the actual finances of what does it cost for me to get there. So if you find that your financial freedom and your next goals or your travel plans or next house or whatever it is you're trying to do, happens to cost $10,000 per month, then you need to engineer a plan of how much real estate do I actually need to buy to hit my goal. Where a lot of people go wrong is they either don't get started because they have a lack of clarity, or they keep buying and buying and buying and buying and buying, and they get to the end of a very long real estate career, they have a ton of debt, a ton of real estate, and they realized, uh, I could have been done much, much earlier and I have wasted time. So number one, you have to actually map out. Second, I really want to focus on this. Do not add extra steps. You're going to see this in books and YouTube video. You need to find your, you need to find your property manager, your lawyer, build your team, scale your finances, save up X amount, find your banker, find whatever the thing is. You do not need to do all these things to buy real estate. You'll need them all after you buy real estate. And as you're going through the process, you're going to find these people. To get started to buy your first or second rental, you do not need all of your teams and all of your systems built out. We have a huge problem. I've seen it, especially in the US, but we go from kindergarten to get to first grade, from first to second elementary to get to middle school, to high school, to college, to job 1, 2, 3, 4, and 5 to save up to finally be able to become an investor and retire. What this trains you to do is to add steps to become qualified to be a real estate investor. As an entrepreneur, you don't need someone else's permission to do things. You're not building your resume. You're simply finding what do I need to go from point A to point B. So first of all, we've defined our goal. Second, we're going to start mapping the steps to get there. What does it actually take? Well, the first thing we're going to do is we're going to get rid of the mindset right now of Hey, I need to do X to qualify for Y. That's not how you do this. I have built multiple businesses that do over $1 million a year with this exact strategy, and we don't add steps. We start with the end in mind. What is the goal? Let's map it out. We certainly can't skip any necessary steps, but what steps are actually required? If you want to buy a piece of real estate, you set up that goal. What do you do next? You start looking at real estate. There's two places to do it. You can do it online on listed properties. If you're using creative finance, you're usually going to be looking at properties that have been around on market a little while because you're creative. You can probably find ways to do deals that other people haven't had a chance to do. Second thing you're going to do is you're going to start building relationships. The first relationship you need is owners in your market. Why owners in your market, you might ask? Owners are the ones who know everything about that market because they've already been operating there. If you're breaking into a market, they already know the property managers, the accountants, the lawyers that they built the system. If you want to learn how to do this, find someone who's done what you want to do and ask them how they did it. And you do that enough times, you're going to start finding deals. So those are the two things. You're actually going to find a property that you want to buy. Now, if you are worried about the money, how much I saved up, how much do I need in reserves? How am I even going to account for this once it's all in? You do not have that problem yet because you do not have real estate to have reserves on. This is a major misconception. Reserves are very important. You should keep them. In fact, we share a lot of rules around how much reserves you should have per property based on the size, unit count, age of the building. There's lots of things to look at there. However, if you don't have money, that is not a reason not to buy real estate. As you buy more real estate and you hold more real estate, you will have more money. All of these things can be fixed with cash flow. If you're starting from the beginning, We're not going to worry about money. We're just going to look at, okay, what do I actually need to hit my goal to get where I'm trying to go? So let's talk about the money. I have a deal in front of me. I don't have any money right now, but I see the opportunity. I understand how this is going to cash flow in long-term fixed rate debt. I've come up with a plan here. Where does the money come from? Talk about this all the time on this channel. Deal, then debt, then equity. You find the deal, then you're going to find the debt. Now, if you don't have any money, you're probably going to have to get creative. So you're probably looking at either hard money or seller financing. Those are the two major ones. I'm going to come up with a debt structure where the cash flow from the property can cover that debt with margin so that I'm actually paid to hold the property that can save up and I can actually build that reserve account over time. Now, as I have money, I'm going to start saving that. I'm going to start investing differently. But when you're starting, you need to get pieces on the board to actually fix the money part. So you're going to go ahead and figure out, okay, what debt product is available here? Am I doing this creative finance? And where, who am I borrowing from? What is the debt piece? If you still do not have enough money for the deal to cash flow, you're going to bring in an equity partner. If you're new, there's likely to be someone who has more experience. It may be one of those owners that you met in the last stage. But once you do that, you've answered, where am I going? What is the deal? And I figured out debt and equity. Now you close the deal. You're done. You own real estate. Everything else can come after that. If you buy your first 10-plex and you don't understand accounting, good news. You made money that you now have to account for. Go figure out accounting. That's how we did it. You have revenue. I don't have adequate reserves. Excellent. That is a problem. Let's now start solving that problem because now you're behind on your reserves for the property that you now own. All you're doing here is setting the right set of problems to build your business. So we really broke this down into 3 steps. You're going to set your target, you're going to take the steps to find a deal, and you're going to line up the debt and if needed, the equity to buy the deal. You're going to close it. You're going to figure out the rest of the problems and you get paid as an entrepreneur to solve the problems that you create. So find the right set of problems and go knock it out of the park. That is all you need to do to get into real estate. If anyone tells you you have to do something else, you have to get qualified, you have to take a mentorship program, totally incorrect. I have done this too many times with over 200 properties. We've done this in hospitality, we've done this in multifamily. I have done this in a property management company. This is how I built our education company. All of these companies do very, very well, and I started all of these without any of the requisite knowledge to do any of them. Find the problems, solve the problems, get bigger, get better, get stronger at your business, keep scaling, and I promise you, you will be happy you did, and you'll move astronomically faster than those who add too many steps. So that's all I have for this. If you want to learn more, go ahead and look at the links below. We actually have free courses. You can learn how we actually bought all the darn real estate and more on our methods for using creative finance. That is free, that is in the link below. And if you have not yet subscribed to this channel, you've already made it all the way through this video. You know we're going to deliver more facts for you. Go ahead and hit that subscribe button and we'll see you on the next episode.