Are you looking to become a real estate investor but having trouble getting off the sidelines and into the game?
Maybe you’re just not sure how to become a real estate investor?
We live in a try-before-you-buy world: rent to own, internships, 100-day trials, and 30-day money-back guarantees. Today, we want to know we’re making the right choice before we have to make a commitment.
I’ll tell you a little-known secret about real estate investing: You can get right into the action today with only a couple of bucks and some hard work – even if you don’t have any real estate investing experience!
How is it possible to take real estate investing for a test drive before going all-in? Bird-dogging.
What is Real Estate Bird-dogging?
Now, if you’ve never been hunting before, you might have never heard of bird-dogging.
Hunters need a dog to help them flush out hiding birds. Real estate investors are no different. We are always looking for the next hot lead: a distressed property and a motivated seller.
A bird dog is someone who hunts down the ‘hidden house’ and brings the lead to the house hunter. In this case, a bird dog will go out and search the community for leads they can sell to a real estate investor.
When you go bird-dogging, your job is to partner with a real estate investor and to find them leads. That’s it. You don’t have to worry about securing or completing the transaction — that’s our job. If you’re new and don’t have the skills or experience to put a property under contract, sell the lead.
I know many young real estate investors who got their start bird-dogging. It’s a great way to jump in and become a real estate investor.
9 Advantages to Bird-dogging
- Flexibility – Work when you want.
- Low cost – Start with $50 or less.
- Hourly – Work as many or as few hours as you want.
- Schedule – Choose the hours that you want to work.
- Control – Be your own boss.
- Relationships – Build your own network of buyers and real estate pros.
- Pay – Get paid for each lead.
- Skill-building – Learn the ropes of real estate investing from day one with no risk.
- Decide – Find out if real estate investing is really for you.
The best part is that you don’t have to risk anything to get started. All you need is time and some grit. You also get to work with and learn from established real estate pros. Most pros won’t work with novices for free. As a bird dog, you’ll bring them leads and, in exchange, you get money, experience, and knowledge. What a great deal!
Now bird-dogging isn’t just about finding the next hot lead — that’s just level one.
There are two levels to bird-dogging, and the second level can really help you learn the real estate investing business.
- Level 1: Finding Properties. Bird dogs scout properties and sell the address and seller’s name.
- Level 2: Finding and Analyzing Properties. Bird dogs scout the properties and analyze the deal. They then sell the information to the investor at a higher rate.
Bird-dogging offers tremendous growth opportunities for hungry investors. As a bird dog, you’ll learn how to find deals, but also how to analyze deals. As you work with local pros on selling your information, you’ll develop sales, negotiation, research, and presentation skills. Looking for your first bird-dogging partnership? We buy leads here at REI Consulting.
Other Ways to Become a Real Estate Investor
Bird-dogging isn’t the only way to become a real estate investor. While it is the quickest way to get out and learn if real estate investing is right for you, it’s not the only way. There’s more than one way to make a cake.
Option 1. Traditional Real Estate Investing
Your goal here is to find a property that you can buy and rent. This can be anything from a condo to a 4-bedroom home. Many investors start with smaller properties, but not all.
Here’s what you need to know up-front.
- Requires a good understanding of financial and legal requirements
- Managing a property isn’t easy
- Tenants are almost always a challenge
I recommend this option to people looking to start a second or third career, who have time, capital, and who like management. It’s not for everyone, and younger investors need to beware. This is a high-risk, high-reward option.
Option 2. Investing in a real estate investment trust (REIT)
With this option, you’re pooling your money with other investors much like purchasing a stock. I recommend this to people interested more in the investing side of real estate, and not the deals or property side.
Here’s what you need to know up-front.
- Requires some capital
- Less risky than owning a property (depending on the REIT managers)
- Exposure to different types of real estate
- No need to worry about properties or tenants
- Little time needed after the initial investment
With a REIT, you get exposure to a specific real estate market while sitting on the sidelines. You don’t need to get out into the neighborhood, and you never have to worry about tenants. You’re really buying into the REIT leadership. This is passive exposure to real estate investing, and certainly not for everyone.
Becoming a Real Estate Investor Takes Time and Hard Work
Getting your feet wet with bird-dogging or a REIT can be profitable. However, if you really want to build wealth, develop skills, and become a pro, you need to put in the time.
My honest advice: Invest time in a comprehensive real estate education/training program. Don’t take a shortcut or hope for quick rewards. Start small, either bird-dogging or working for a real estate investor. Build up your skills, experience, and then when the time is right, make the leap to become a real estate investor and get into the game. You’ll be glad you did!