I Purchased My First Investment Property In Cash In My 20s! – Part 1

As I briefly mentioned in my About Me page, I had no damn clue what I was doing and getting myself into when I purchased my first real estate investment property in 2009. I was in my 20’s and utterly clueless in anything finance related. Yes, I was ignorant, naive, and clue-less! I am sure many of you can relate . Although… I wasn’t completely naive. I saved some money! I gotta say that was a little bit of an intelligent thing I did and couldn’t be more proud of myself. As a matter of fact, I purchased my first investment property before I purchased my primary residence. Lo and behold, it was and still outright my best investment property. I can arrogantly say that this property generates some badass ROI for me, >50%! Click here to see my ROI calculations.

More interestingly is that my first purchase was a foreclosure and I purchased it in CASH. Yes, C-A-S-H! Now, some of you may say ”WTF?!!!” and some of you may say “Well, now that was stupid!” And I don’t disagree. It was pretty idiotic of me to pay cash as it tied up my cash to purchase more properties AND the interest rate at that time was incredibly low, but remind you, I was naive and clueless and thinking ahead was a foreign concept to me. In your 20's, all you can think of, as many people have also suggested to me, was pay everything with cash if you are able. No Debt, No Stress. Although this statement is true, it is only partially true. Not all debts are bad debts, and I will explain in my future article. Thus… as I learned several years after the purchase, I can cash out, which I eventually cash out in 2015. And that is how I get the sweet, badass ROI!

I would have cashed out sooner, but I was so busy that I didn't have time to cash out. Well...let me take that back... I didn't cash out sooner not because I was busy, because you will make time when you really need to do something, but I didn't need the cash yet. I still had cash in hand for a 25% down for my next investment and I was also generating cash from my full time job. But then the Fed was constantly on the bench talking about an interest hike and so I decided to cash out before the Fed raised the interest rate.

Let me tell you how clueless and naive I was:

  • no knowledge on how to buy a house
  • zero knowledge of financing, down payment, closing cost, interest rates,
  • didn’t know any contractors,
  • didn’t know how to be a landlord,
  • didn’t know what ROI stood for,
  • didn’t know the laws and regulations of renting, the buying process, the whole nine yard

Real Estate InvestmentI mean, I was completely clueless! None of my family members or friends have any knowledge of real estate investments, but I knew that was what I wanted to do. Not because I was brilliant or anything remotely close, and still not. I was just greedy and thirsty for money $$$ and when I want something badly, I will do everything in my power to get it! I wanted to be a Kardashian’s wannabe. Wait a minute, are they known at that time? Anyway, so when the opportunity came, you know the financial crisis of 2008, although I was like one year behind, I jumped right in.

So long story short, I purchased a foreclosed property, renovated, and then rented out in approximately two and a half months with no knowledge of real estate investment. I took this risk because of my desire to be financially free when I am still in my 20s. When you start young, you have a lot of time to achieve your goal, whatever that goal may be. Since I paid cash for the property and also paid cash to renovate, I didn’t make much ROI until I cash out (still good ROI though). Nonetheless, paying cash wasn’t a bad thing. I was able to acquire the property (banks love cash), I own 100% equity, and I didn’t have to go through the painful, drawn-out process of financing, and closing was a breeze.

To summarize:

  • Clueless purchased a foreclosure to start her real estate investment - if you have the fire and desire in you, you can do it
  • Paid cash – I saved money to pay cash for this property and still had cash left for the next property
  • Renovated the property – the property needed a renovation before I could rent it out
  • Best investment, badass ROI – today, still my best investment
  • If clueless can learn to invest in real estate on her own, so can you!!! – it only takes desire and motivations

Preview for Part 2:

  • Condition and details of the property
  • Cost of the property / Cost of renovation
  • After the renovation
  • Lease price throughout the years
  • Photos of the property

I would love to hear from everyone how they got started in real estate investment. Please add some comments. Provide any feedback, suggestions, advice. Thank you for reading and have a good one!

Disclaimer: All content is the opinion of the author. No investments is guaranteed to generate income. Please do your own research before you jump into anything crazy. Invest at your own risk.

Credits:  Investopedia, Wikipedia, Zillow

Hey, Welcome! I am Thuy. I learned how to live frugally and saved money during my early 20s and purchased my first investment property in cash. I also invest in stocks, ETFs and Mutual Funds.

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