Understanding Real Estate Investment Costs: A Guide to Calculating Your Buying Power

How much money do we need for investing in real estate? You usually wanna have at least $20,000 before buying your first property. But you have to run the numbers. It depends on how much of a down payment you’re putting in and how much the purchase price is of the home. For example, if you’re buying a 100 thousand dollar rental property and you’re putting in a 20% down payment, you might be putting in around $26,000 or so for the closing cost and the down payment. But if you’re able to get a 200,000 dollar duplex and use an FHA loan at a 3.5% down payment and you live in one of those units, then you might be looking at less than $10,000 to get that property. I’ve even bought a couple properties at around $20,000, all cash. It does depend on your market, right? If you’re buying in a high cost of living area, you’re probably gonna need a lot more money. That’s why for us, we’re not just invested in California, we’re invested in Texas, Florida and Georgia will invest out of state, which allows us to buy round properties at a cheaper price.