New Guy

[nnkrealtor]

Hello, I have been reading posts here for the last year or so and decided to start posting. A little info about me.... Iam 24 and a computer tech and I am also a Part time Real Estate agent. I just got married about a month ago and my wife is a Real Estate Appraiser. I have only been an agent for about 9 months and made more money in my first 9 months then I did all year at my Computer Tech job. I am considering leaving my computer job to sell R.E. full time but I just can't bring my self to give up my guaranteed pay check every month and benifits. My wife also works as an independant contractor with commission her only income and no benifets. I am deffinatley going to stay at my computer job until the end of the summer and see how RE goes this year before I make any decisions but for now I need to invest my RE income because my computer job and my wifes job covers all of our living expenses. Iam talking about an extra 40-60 K. Any ideas would be great. I already have a house worth 165K with a 90k mortage, a TSA at my work 200/month to that, and I will be opening a SEP IRA at the end of this month.

Thank you for your help and I look foward to being a member of this forum.

[Nords]

Quote:

Originally Posted by nnkrealtor Iam 24 and a computer tech and I am also a Part time Real Estate agent. I just got married about a month ago and my wife is a Real Estate Appraiser. I have only been an agent for about 9 months and made more money in my first 9 months then I did all year at my Computer Tech job. I am considering leaving my computer job to sell R.E. full time but I just can't bring my self to give up my guaranteed pay check every month and benifits.

Welcome, NNK.

In a RE that seems to be overheated just about everywhere, it's easy to overcrowd the field with agents. When the inevitable downturn happens, the knives come out and the competition turns vicious.

Hawaii last had a similar market in 1989. When it imploded in 1990, over the next five years the ranks of realtors thinned by over half and stayed that way until 2000. Now the cycle begins anew as everyone and their entire families are reviving their licenses.

Right now if you keep juggling the two careers then it seems that you'd have the best of both worlds-- a steady job with medical benefits that you can count on if the RE market stops in its tracks, plus a working spouse who has the potential to make quite a bit of overtime. In addition she's in a great position make contacts and identify early opportunities.

Neighbors up our street are both full-time realtors. The advantage of this is that they have a very flexible schedule and they're able to buy a distressed property or two every year for rental income or flipping. They're also able to take time off to be with their kids (or when the surf's up). The big downside is healthcare coverage and lumpy income (for their credit ratings & mortgage loans).

If you keep your boring yet secure day job, you could emulate their strategy and enjoy steady benefits. A few years down the road you may have rental properties & cash flow sufficient to leave the IT job and work full time on real estate.

Are you able to work the IT job fewer hours and maintain the healthcare benefits?

[nnkrealtor]

I am a Public School employee so i work till about 3:30 every day (supossed to be 8-4 but i will sometimes get in around 6:30-7 so I can leave early if I have some RE business to attend to) but I get all the school holidays off and I also usually take my lunch break to get things done in the R.E. Office. I work through the summer so I don't get those 3 months off but we have 3 day weekends in the summer. We live in a small rural area about 2 house outside of DC this is a waterfront community close to the Chesapeake Bay and we are getting a lot of Retirees and 2nd homers down here from the DC northern VA area. We have seen only a slight slow down in the Winter this year but I want to wait until the spring comes to see how things pick up again. I really enjoy the R.E. more then I ever did my IT job, that may also be a huge facor in my decision. Right now I need to find something to do with my RE income.

[Nords]

Quote:

Originally Posted by nnkrealtor Right now I need to find something to do with my RE income.

Pay down debt, buy a nice fixer-upper family home, and read a library copy of Bernstein's "Four Pillars" to decide on your asset allocation...

If you're tempted to buy that huge honkin' mansion, read a library copy of "The Two-Income Trap" and reconsider!

[nnkrealtor]

I already have a house

Quote:

I already have a house worth 165K with a 90k mortage, a TSA at my work 200/month to that, and I will be opening a SEP IRA at the end of this month.

But thanks for the reading recommendations

[califdreamer]

Hi nnk,

You've got an ideal set up with your day job (early hours, benefits, vacation days). I have a pretty flexible job that has enabled me to invest in RE over the last 9 and a half years and it's worked out quite well. Of course I've been lucky to ride the wave of the West Coast RE boom but now I'm moving my equity to out-of-state mkts.

Which brings me to my point. You may want to consider investing in an out-of-town mkt that hasn't appreciated as much as the natl average over the last several years. I know some advise against investing out of your geo area, especially on your first investmt propty. Given your familiarity w/ RE and flexible hours I think you should at least consider it. There are some areas in the East that could be pockets of opportunity: Richmond, VA, Raleigh or Charlotte, NC, Nashville, TN, Jacksonville, FL to name a few. You could probably find a nice positive cash flow fourplex with your 60k.

My two cent's worth: keep the day job, research feasibility of out-of-town mkts, invest in a fourplex w/ 25% down (make sure it cash flows), perhaps find investors in your area that would be interested in investing in the mkt you've researched and be their buyer's agent. Something to consider.