Caleb Hommel and Chuck Sotelo knew little to nothing about real estate before investing in their first property. They were only teenagers, after all.
“We had no experience,” Sotelo told Business Insider. “We didn’t have any credit, we didn’t have any money, and we didn’t really have any connections.”
The friends, who met on the first day of high school when they sat next to each other in a pottery class, started discussing buying property during the pandemic. At the time, they were enrolled in two different junior colleges, but remote learning meant they were both taking classes at home, five doors down from each other.
Without money or experience, they started attending local real-estate investing meetups. At one of those events, someone referred them to a mentorship program called Multifamily Strategy, a paid program that they eventually enrolled in and that would help them build a 28-unit real estate portfolio using other people’s money.
Courtesy of Chuck Sotelo and Caleb Hommel
Avery Heilbron found himself in a similar predicament to Hommel and Sotelo after graduating from college in 2018. He wanted to own real estate, but didn’t have the capital — or a strong enough credit score — to buy.
“I didn’t even realize I needed credit,” Heilbron, who got his first credit card a couple of months after finishing college, told BI. “So when I was first looking with my agent, I wasn’t allowed to have a pre-approval yet because I had no credit score.”
Like Hommel and Sotelo, he started with local real-estate networking events. It allowed him to learn the ins and outs of his market, Boston, and get a better understanding of the buying process, so that when he was financially prepared to buy, he’d have the tools to spot a deal and jump on it.
As it happens, it was an agent he’d met at one of the networking events who helped facilitate his first deal. The agent gave him a heads-up on a duplex about to go back on the market after a cash offer fell through, and asked Heilbron if he wanted it before he relisted it. Heilbron, who had strong credit and enough savings for a down payment by then, jumped on the offer.
That first deal would lead to a 14-unit portfolio and enough rental income to walk away from his corporate job.
The power of surrounding yourself with like-minded people — and how to do it
Denver-based couple Jeff White and Suleyka Bolaños, who retired in their 30s when the cash flow from their rentals surpassed their day job income, used Meetup.com to find real estate networking events in their area.
Being in a room with other investors was helpful for a few reasons. It was a space to discuss strategy, such as “house hacking” — living in one part of a property while renting out other units to cover the mortgage — which is how the couple has managed to live for free in their own home since 2017, and 1031 exchanges, a tax strategy they eventually used to exchange one investment property for two and sidestep capital gains tax along the way.
It was also helpful to connect with people who understood their goals and could relate to their challenges.
“You don’t feel like this lone person out there just doing things all by yourself,” said Bolaños. “That can be really stressful when you feel like you have to do everything yourself, but when you join these meetups, you get to know people, you network with them, you have some kind of an issue, you know who to reach out to. You just have more of a community that’s there to help.”
If your city or town doesn’t have any convenient meetups, consider starting one yourself or look into online communities.
Ludomir Wanot, who built wealth doing wholesale deals in Seattle, joined a Facebook group called WA Real Estate Investing (WAREI) to meet local investors when he was first starting.
He also took advantage of local meetups. That’s where he found mentors and asked established investors exactly how they got started and how they expanded.
“Surround yourself with people who know more than you, ask questions, and build relationships with all different kinds of people you meet because you never know when you can work with them down the road,” said Wanot.
You could end up shaking hands with your future business partner, lender, or wholesaler — or, like Heilbron, your future real-estate agent holding the keys to your first deal.