But if you really have the desire and passion to purchase investment real estate—even if you are already involved in a full-time career or pursuit—that should not hold you back.
How I used my lunch hour to buy investment property
I started my real estate career by leveraging my lunch hour.
Maybe your “hour” is a little different. Maybe it’s on Saturday morning or after 5 p.m. Whenever it might be, you have an hour in your week or your day to pursue your dream of becoming a part-time real estate investor on the side of your traditional career. Here’s how I did it.
I respected my career, and I encourage everybody to do the same. I did not want to do anything to lessen my commitment to my career, my company or my job. I do not encourage anyone to do that. I do not encourage you to chase real estate at the expense of your career or the commitment you have made to your employer.
How did I balance it all?
So how do you balance it all? I leveraged my lunch hour—literally. Instead of sitting at my desk surfing the Internet while eating a sandwich or sitting down in the corporate cafeteria or alone in some fast-food restaurant, I used the time to find where I wanted to purchase my first property.
I would head out around noon and just drive around various neighborhoods until I determined the area where I wanted to purchase my first property.
I had a couple of criteria and yours may be very similar, or yours may be different. Here’s what worked for me.
I was combing neighborhoods close to where I lived and worked. I wanted my first property to be close to me for a number of reasons.
First, I wanted to be able to keep an eye on it. And second, since I was just starting out, I was planning to do all my own initial repairs and updates as well as any ongoing maintenance, so proximity was important. I was also planning on managing it myself in terms of the marketing and the sourcing of tenants, etc.
So I determined, “Let’s stay close to home,” on this first property. I chose to stay in familiar territory where I knew the neighborhood and the demographic or type of people who likely would be my tenant or customer.
And finally, I settled on an area that allowed me to purchase a property at a very reasonable cost or a low cost of entry. Let’s face it, you are a busy professional. You are pursuing your first investment property. You are prudent to minimize your risk and exposure and start small. You don’t need to buy a four-bedroom, three-bath home with a swimming pool and target renting to executives. That might not be the best approach. That is putting a lot on the line for a novice or a busy professional who cannot allocate a lot of time to his or her first real estate investment.
So, in my case, I chose to look at smaller properties that were very affordable and had a very low-cost of entry in order to minimize my exposure as I worked through my learning curve.
It took more than a few lunch hours
I will be honest, it took more than a few lunch hours to accomplish this.
It wasn’t one day or two days, but rather, over the course of several weeks.
Once I narrowed down my list, did my due diligence and found the area where I wanted to purchase, there was still work to be done.
But as a busy professional, I did not have the time or expertise to source my own property off the wholesale market like many investors do. That takes a lot of time, effort, knowledge and a well-built network of your own. I was not in a position as a part-time, new real estate investor to do that, so I had to find a Realtor.
I did that on my lunch hour, also. And you can do it on yours. Once I knew the area in which I wanted to invest, I looked for signs advertising Realtors who were active and prominent selling homes in that particular area or neighborhood.
If they were listing a house for rent, then so much the better. I knew by the names, faces and numbers I kept seeing on those signs there was a pretty good chance those real estate agents were familiar with that area.
And if I could find one listing a property for rent, that meant he or she also was familiar with the rental market there.
I identified an agent who seemed to be active in that area and whom I ultimately chose to work with in buying my first rental property. More accurately, I should say he worked for me; that’s what an agent will do for you.
If you are overwhelmed at the thought of investing in real estate because you have a busy full-time career and a serious commitment to an employer or another passion, hire a real estate agent who will work for you and take care of a lot of the legwork.
You can focus not only on your part-time real estate investing, but also on your full-time career, and you do not have to turn your back on either one.
I would also urge that when you are searching for that agent, don’t succumb to the temptation to go for the first agent whose name you see on the billboard, or the one who has the biggest ad in the newspaper or sends the most fliers to your house.
I took a very different approach.
I did not seek out the big real estate agent in the area who was doing a lot of retail deals. I chose an agent who was newer, hungrier, more motivated and who had the bandwidth and the energy and the willingness to work with a real estate investor like me.
I was not looking for high-dollar properties
I was not looking at high-dollar properties. So working with me may not have been real appealing work to a higher-end, high-volume agent or a more experienced, tenured agent. An agent of that level may not have been able to give me the attention I needed because of who he was and where he was in his career.
It was not my objective to take advantage of a new agent and his availability and time. It was actually the opposite. And this agent realized it and knew, “If I sell this part-time investor one property, there is a good chance he is going to want to come back to me very soon and want a second property, and a third property and a fourth property.”
I came back to that agent for more properties
That’s exactly how my story played out.
Not only did I purchase that initial property from this agent, but I ultimately purchased many properties from him as I built my portfolio on a part-time basis, and he profited very nicely over the course of time.
So it was a relationship that worked great for both of us.
Now it was time to find the house
Once I found the Realtor, now it was time to find the house. That is where this Realtor came in so well for me as a part-time investor and will work for you.
He knew my area. He knew my criteria. And he set up an auto search. I would get daily emails with the properties available that met my criteria and we got into a rhythm: I would receive the email first thing in the morning, then call him and he would schedule an appointment for noon. And there I was, back out on my lunch hour.
But I wasn’t combing neighborhoods anymore or looking for Realtor signs. I was actually walking into properties and ultimately making offers on them. And this worked great for me as a part-time investor. I had a busy career, but before I ran into work each day I would scan the email to see if there was anything I was interested in seeing at lunch.
See you at noon!
I could call him or text him that morning, and he would quickly reply back with “see you at noon” and we would go visit a property or two at lunch.
If you fast-forward, I ultimately purchased a property through this process. It was a two-bedroom, one-bath, one-half of a duplex. It was close to my home. It was a very affordable purchase price. It was small.
My exposure to maintenance and repairs was very minimal, as it was only about a 900-square-foot house. It was very manageable. It met all my key criteria for my first investment property. As a part-time investor, I did not want to bite off too much too soon.
I still own this property today, more than 10 years later, and it still generates a nice monthly cash flow.
The deal does not end at the purchase. As a busy executive, I did not have time for a lot of the future activities that are required of investment properties, and that Realtor came in very handy as a critical component of my ability to manage the growing portfolio that he and I were working together to build during my lunch hour.
Help with rental rates
He was a great resource to determine rental rates. I did not have time, access, knowledge or experience to be able to price my properties for rent. He had access to all the rental data, and as we would approach the properties and consider purchasing them, part of our discussion would be the due diligence he had done and his calculation of exactly what that property would rent for.
Then I could use that to determine my profit analysis to evaluate if that was going to be a good, profitable investment.
He would do most of the work, enabling me to make decisions on my lunch hour without doing that type of analysis.
He would also guide me to a quality, trustworthy inspector to inspect the property once I placed an offer.
He helped with financing
My Realtor also found me lenders as we continued to build my portfolio. As a busy executive, I did not have time to source and screen lenders. Ultimately he pointed me to lenders I have relationships with to this day—now as a full-time investor.
He even found repair people for me. He found title companies for me. And though I did not initially use property management, your Realtor can even find you a property manager. If you are so busy you do not think you can manage your properties once your buy them, don’t let that be a barrier. You can get good property management, and your Realtor can help you find it.
Everybody has an hour—whether it’s your lunch hour, your Saturday morning or your evening. Don’t let time be a barrier to you as a part-time investor who is seeking to purchase your first investment property.