Real Estate Career or Part Time Investing in Rental Property

Should your real estate career start out part time or just jump right into it?

One of the most asked questions about investment in rental property is whether you can do it part time. A few young people without families are fortunate to have no one vying for their time. But for some of us there are kids activities or spouses that are not into investing in rental property. If you are single or have a spouse that is supportive that is great. I've done this with a wife that supported me at times and at other times didn't. I've also done this with 4 children, a dog and a full time job.

My first advice to a beginning investor would be "don't quit your job". There is a steep learning curve to a real estate career in rental property investing and unless you are loaded with cash, most properties will have little positive cash flow. Many of us have watched programs such as "Flip That House" and feel that if that idiot on TV can make money flipping property, than so can't I. But the truth is that unless you have a booming real estate market, flipping houses takes a lot of skill. You will underestimate the cost and time it takes to rehab a property. And in many parts of the country houses are not selling because real estate prices are too far out of historical trends.

Many people want to get rich quick but the majority of millionaires used the tortoise method of investing. Start off slow and learn everything you can to become an expert. If you were to only buy one investment rental property per year for twenty years you would have an excellent portfolio of properties by the time you want to retire. This is a tough sell in our instant gratification society. How do I know? I purchased 12 properties in my first 18 months of investing because I couldn't wait to get rich. You probably guessed that I didn't make money off of any of those and you would be right. I was overwhelmed and lost all focus. So, start slow.

If you have children, don't use them as an excuse not to do anything. If they are old enough to help out, there are lots of advantages to making them part of your business. I never liked giving my kids money without strings and by "employing" them for age-appropriate jobs I could get a tax write-off and teach them valuable lessons. Many young people today have no skills in home repair and you can give them an environment to learn new skills. And above all it can provide time to bond with your family!

After you have purchased and rented out some properties and find that you really enjoy this type of work and want to make a real estate career of investment in rental properties - go for it! But make sure that you have cash reserves set aside. It wouldn't hurt to have a business line of credit as well.

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