How to Become a Full-Time Real Estate Investor
Last Updated on March 29, 2023 by Mark Ferguson
Many people dream of quitting their jobs and running their own business. Becoming a full-time real estate investor may be one of the easiest ways to achieve this dream. However, making enough money or feeling comfortable enough with real estate takes a lot of work and time. While it might be one of the easiest ways, it is by no means easy! I have been a full-time real estate investor and agent for over 15 years. I love going to work on Mondays because every day is different and exciting. I also have complete control of what I do because I own my own business as a real estate investor. Real estate has even allowed me to create this blog, write books, and do many other interesting things. I did not have a fast and clear path to being a full-time real estate investor, but I have learned a lot over the years that can help others find their own path.
How did I become a full-time real estate investor?
I started in the real estate industry right out of college as a real estate agent. My father had been an agent for a very long time, and I reluctantly worked with him when I could not find a decent finance job. I lucked into real estate, but once I got started, I loved it. Being an agent is not the same as being an investor, but the careers are very similar. Becoming a real estate agent was actually a great way for me to become a full-time real estate investor.
I struggled as an agent for years until I found my niche as an REO broker selling bank-owned foreclosures. I did not like talking on the phone, which is not a good trait to have if you want to sell houses! Selling bank-owned homes was perfect for me because almost all of the communication was done online.
I started making a lot of money as an agent, but I never seemed to have as much as I thought I should. I knew I needed to invest my money, not just make it. I researched every avenue I could: stocks, bonds, franchises, and rental properties. I was in the real estate business, but I wanted to make the best decision for me, not take the route which I knew best. Rental properties kept coming back as the best option to invest my money.
I invested in as many rental properties as I could buy. From 2010 to 2015, I had purchased 16 rental properties that made me about $8,000 per month in passive income. It is hard to pinpoint when I became a full-time investor as opposed to a real estate agent, but the shift was gradual over time. In fact, I was flipping houses once in a while with my father as early as 2002. I would shift from focusing on the agent side to the investor side depending on what I had going on in my career and the real estate market.
Around 2015, I was selling REO properties as an agent, I ran a real estate team with other agents, I had created the InvestFourMore blog, and I was flipping about 10 houses per year. After 2015 the REO business in Colorado virtually disappeared, and I found myself focusing on the investing side of the business. I went full-time into real estate investing by flipping 10 to 30 houses a year and investing as much money as I could into rental properties.
What are the benefits of real estate?
Real estate has been great to me, allowing me to buy childhood dream cars, like my Lamborghini Diablo and Lotus Esprit. Not only has real estate made me a lot of money, but I have time to enjoy my family and life. I have freedom to work when I want, to take time off, and start new businesses. Of course, there are also real estate investors who work 100 hours per week and do not have time for anything. The point of having your own business should be to create wealth and freedom for yourself, not to give yourself another job.
The video below also goes into becoming a full-time investor:
There are many different ways to make enough money in real estate to be a full-time investor. Here are the most common ones:
I think rental properties are the ultimate goal of any real estate investor since they generate money every month for as long as you own the property. You can use a property manager and have a mostly passive investment that is awesome for retirement. The other types of real estate investing produce income which can be used to purchase rental properties. I do not think of flipping or wholesaling as investing but rather more of a job. You can turn flipping or wholesaling into a business, as I have done with flipping, but it is not passive by any means. When you are in the business full-time, everything gets easier. It is easier to find flips, to wholesale, to find rentals, and develop a plan to make a lot of money…which can then be invested to make even more money.
To learn more about the best way to buy rental properties, check out my book: Build a Rental Property Empire: the no-nonsense book on finding deals, financing the right way, and managing wisely. It is available on Amazon as a paperback, ebook, and audiobook.
Can you make more money full-time?
A lot of people want to get into real estate full-time but are scared. They are scared of:
- Not making enough money to survive.
- Losing their benefits or retirement.
- Not being able to get loans easily because they would lose their W2 income.
- Failure.
These are all valid concerns, but they also should not stop you from getting into real estate full time. Many of the people I talk to are already making money on flips or rentals or as an agent. They might be making $100,000 per year in their corporate job and making $50,000 per year from real estate. They have gotten used to the extra money real estate brings in, but they do not want to lose the $100,000 income from their regular job. They also have a hard time seeing how they can grow the $50,000 they make in real estate now to the $100,000 or $150,000 they want to make in order to quit their day job. Here is what you have to consider:
- When you quit your job, you will have so much more time to devote to real estate and planning your life. How much time do you have to work on real estate now? How much time do you have for your family? How much more money could you make with real estate if you could devote 40 more hours per week to it? One of the reasons I can do so many things in my business is that it is all I do! I don’t have another job to worry about.
- When you first started in the real estate business, how much money did you think you needed to go full time? If you made $100,000 at your regular job, you probably thought you needed $100,000 to replace your income and go full time. Once you started making more money, you got used to the extra money coming in, and that number kept increasing. Now it is $150,000, soon it will be $200,000, then it will be $250,000. Getting to that number will take a lot longer if you are still working at another job. You will have less and less time and get more and more stressed as well.
- When you are in real estate full time, you will have more flexibility with seeing houses, networking, searching for deals, etc. That will make it so much easier to make money in the business. You are not just adding hours to the time you have to make more money—you are adding advantages over other investors who are also working another job. You are getting yourself on a level playing field with investors who are already working full time in real estate.
Some of you may be thinking I wish I made $100,000 a year and was in that situation making even more money with real estate! If you are making more or less money, the concept is the same: simply plug in your numbers to see where you stand. If you are making much less money, you might be in a better situation. Replacing $25,000 of income with real estate and giving up that job is a lot easier than replacing and giving up $100,000 in income.
How do you actually quit your job and get into real estate full time?
The first thing you must do if you want to quit your job is to make a plan. You cannot wish that someday you will make enough money to quit and hope that day comes soon. You need to make a plan that states:
- How much money you have to make from real estate before you quit?
- How much money you need to have saved before you quit?
- How much passive income you need versus earned income?
- When you plan to have all this and what date you plan to quit?
By making a plan and setting goals, this will all become much more real and help you achieve it much faster.
Another thing that will help people get into real estate faster is making money in the business. Rental properties are great for passive income, but buying them and building up a significant income from them can take time. If you can make money as a real estate agent or from flipping houses, you will be able to quit your job much faster. You will also be able to increase how quickly you buy rentals because you are immersed in real estate.
Conclusion
So many people dream about quitting their jobs and starting their own business. Real estate is a great business and one of the easiest to start. However, most people never end up following their dreams because they have no plan to follow. Hoping will not get you where you want to be. You need to set a detailed plan for exactly how you want things to go, and the sooner you start, the sooner you will get there. Things do not always go as planned ( I have a plan to purchase 100 rentals, and I am way behind, but I am not giving up), but that doesn’t mean you cannot try to make a better life for you and your family.