I am part of the 92%.
My interest rate on my three-family house in NYC is currently 3.125%.
My mortgage payment is $2,800 a month.
I control a million-dollar asset for the same price as renting a nice 1 bedroom apartment in my neighborhood.
And I don’t pay to control it…
My tenants cover the mortgage payment and the costs to run the building in full.
But that’s not how it started…
My house was worth 550K when I bought it.
My interest rate was 4.75%.
Rents for the building covered the mortgage, but I had to pay for water, gas, and landscaping, and cleaning.
But I only get to be part of the 92% because I bought the house to begin with.
If I hadn’t bought the house:
I wouldn’t have the opportunity to lock in a lower interest rate.
I wouldn’t be earning double the rental income today
And I wouldn’t have a few hundred thousand dollars of equity in the building.
The “good times” didn’t just start from day one…
I had to be in the game in order to win.
The longer you wait to buy your first house, the more future opportunities will pass you by.
Here are 3 practical ways you can get started as a first time home buyer, regardless of interest rates or how expensive it is where you live.
→ Get a factual understanding of what you can afford
If you gauge what you can afford solely on the price of the house, you are relying on feelings and not facts.
Your feelings can lie to you.
Facts…
Not so much.
You will have a better understanding of what you can afford by using a mortgage calculator.
Yes, interest rates have gone up recently. And so have home prices.
But the monthly mortgage payment on the house may still be doable in comparison to your current rent.
Comparing your current housing spend to a monthly mortgage payment is a more practical way to assess affordability.
You also might be surprised to learn that the rent you are paying might be more than a mortgage payment if you were to buy your own house.
→ Learn about real estate fundamentals
You can do anything once you know the basics.
When you learn how to swim you first learn how to float.
Why?
Once you learn how to float you can easily add in the body movement required to perform a specific stroke.
Even if it’s day one of learning a new stroke, you won’t drown because you understand the basics of floating.
Every stroke is just floating with a variation of an arm, leg, or body movement combination.
The fundamentals of real estate are cash flow and equity.
Every real estate money-making strategy is a variation of one or both of these two concepts.
Understand these, and you can do whatever you want in real estate whether it’s buying your first house strategically, buying a hotel, buying a 100 unit building, wholesaling, flipping…
We could go on for a while…
It’s all a variation of cash flow and equity.
As a first-time home buyer understanding cash flow and equity means you are in control.
That control comes from the ability to look at ANY house and determine if it will benefit you financially….
Without having to rely on someone else’s opinion.
Everyone has a different definition of what a good real estate transaction is.
So, by understanding the basics, you can start to develop your own metric for what is a good deal for you.
→ Curate what you consume
For every Instagram post that you see saying that millennials are so screwed and will never be able to buy a house, there is someone that posted that they bought a house this year…
And probably will buy another one in the next five years.
You are going to believe what you surround yourself with.
And you get to decide what to surround yourself with.
If everyone that you talk to supports the story that buying a house isn’t possible, add one person to your circle that believes the opposite.
And start interacting with that person more.
That’s the person that is going to inspire you to get to the next level.
Parting tough love 🫶🏽
What’s one thing you are going to do this week to get you one step closer to your first house?
You will either look back in the next few months and be amazed at how far you have come…
Or you will be in the same exact place setting yourself up to miss future opportunities.
Where do you want to be?
