Dan Lane, the host of the Rental Income Podcast, presented his findings after interviewing 400 real estate investors at the I-81 Real Estate Investor Meetup. His presentation provided valuable insights into the mindset and practices of successful real estate investors.
One of the key takeaways from Dan’s presentation was that there is no secret formula for success in real estate investing. Different strategies can work for different people, and what works for one person may not work for another. Therefore, it’s crucial to conduct thorough research and understand the risks involved in any strategy. Investors should be prepared to pivot if necessary.
Dan emphasized that it’s essential to start with what you want in your life and work backward from there. Begin with the end in mind and build a plan that aligns with your goals and priorities. This approach will help investors make strategic decisions that will ultimately lead to success.
Another critical point that Dan made was that most successful investors didn’t have a flashy or amazing success story. Their success was slow and steady, built over time through careful planning, hard work, and a commitment to continuous learning and improvement. Time and knowledge built over time helped them to build their wealth.
While investors have different approaches, Dan identified several common practices that successful investors follow. These include deciding whether to reinvest cash flow or spend it, using W-2 income to build their portfolio or to leave their job, building massive amounts of long-term wealth that had to be properly handled and managed, and seeing plenty of opportunities to grow in many different directions.
Dan also noted that investing in good or bad neighborhoods does not necessarily affect success, but there may be different consequences based on that choice. He identified the most significant expenses for landlords as dishwashers, ice makers, garbage disposals, and screen doors. Advanced landlords removed these items from their homes. Most landlords agreed that they would buy new appliances overused for many reasons.
Dan stated that “I’ve found that investing in bad neighborhoods can be more profitable, but it also takes more time and skill. The people I’ve found that have had the most success in those neighborhoods are people that specialize in the area. They are very hands-on managers and are very familiar with what streets are good investments and which ones to stay away from.”
One landlord had a lot of success calling his tenants weekly to make sure they are still working, keeping up the property, and seeing if they need help with anything. This approach led to a lot of success in a “D” neighborhood, but would not be appropriate in another type of neighborhood.
One major key to note is that “There is nothing passive about investing in bad neighborhoods.”
Properties that are in good condition, where you have placed a well-qualified tenant can be very passive and hands-off. But, investing in rentals is never truly passive.
According to Dan, understanding your market very well is a crucial key to an investor’s success. Knowing the level of rehab needed for different types of properties, supply and demand, and rents for different areas are all essential factors to consider.
Dan shared several tips from one very successful landlord, that included doing all communication with tenants via electronic communication, eliminating the lawn, using combo locks, and only writing month-to-month leases. He also emphasized that landlords should always get title insurance, have all utilities revert to the owner at turnover, use RUBS to estimate water or electric bills, and factor in the cost of windows and sewer lines when buying a property.
Finally, Dan recommended that new investors should start with house hacking, as it’s the single best strategy to get started in real estate investing. He emphasized the importance of thinking long-term and understanding the laws that affect the rental property, such as fair housing, lead paint, and permitting. Networking with other investors is also crucial for success. Structured REI groups like the I-81 Real Estate Investor Meetup are so valuable to learning, and building relationships that will lead to new opportunities and personal growth.
Overall, Dan’s presentation provided valuable insights into the practices of successful real estate investors. His findings emphasized the importance of careful planning, continuous learning, and a commitment to long-term goals.
For more information about the Monthly I-81 REI Meetup go to: https://www.mdwvhomebuyer.com/berkeley-county-investor-meetup/
Jump Capital operates in West Virginia, Maryland, Virginia, and PA areas loosely connected by the I-81 Corridor. We have a long-standing real estate investing business that holds long-term and short-term rentals. We have a long track record of successfully acquiring, fixing, & flipping single-family homes in this area. We have successfully completed 100’s of multi-family and single-family deals. In doing that we have become very competent in underwriting investment deals. Based on this experience we are now providing that service to other investors.
We are now offering qualified investors funding opportunities to grow their investment business in the local area. If you are looking to fund the purchase and rehab of a fix-and-flip project or short-term flip into a rental, we may be a solution to your funding needs.
As we always have, we are looking to continue to build strong relationships and strategic partnerships through our funding business. If you have a project to fund and want more information please either call 240-630-4255 or submit your information on the link below.