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My real estate side hustle helped me build a 6-figure portfolio and start creating generational wealth: Here is my best advice

"My real estate side hustle has allowed me to pay off my $26,000 student loan debt and match my 9-to-5 income."

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Ogechi Igbokwe is the founder of One Savvy Dollar.
Courtesy Ogechi Igbokwe

I didn't have a set goal in mind when I started my real estate journey. At first, I wanted to create another stream of income that would help me to be less reliant on my day job in banking. I was in my early twenties and I'd had friends get unexpectedly laid off for industry reasons far beyond their control. I didn't want that to be me.

I purchased my first property, a single family home in Georgia that I still own today, in the summer of 2007, and then a second property, a two unit multi-family home in New York the spring of 2008.

By the time I bought that second property, even amid the Recession and a temporary dip in value, I felt confident that real estate was the right side hustle path for me, because it was something I could pursue while I kept my day job.  

It was a smart choice: My real estate side hustle has allowed me to pay off my $26,000 student loan debt and match my 9-to-5 income.

My most recent real estate purchase in 2020 brought the number of properties I own up to five. My investment portfolio generates six figures, bringing me one step closer to my ultimate goal of financial freedom.

While I'm not on a FIRE track, my main objectives are to work because I want to, not because I have to — and to build generational wealth. Through my online business, OneSavvyDollar, which I started in 2015, I have been able to use what I've learned from my experience to help others achieve their money goals.

Here is how I got started, and my best advice for anyone who wants to get into real estate. 

I found the investing strategy that worked for me 

There are several different kinds of approaches to real estate investing. Some of these strategies include:

  • House hacking, when you buy a multi-unit apartment and live in one unit while you rent out the other unit 
  • Partnerships, either going in with friends or through a syndication deal, which is when where someone finds the property and seeks out investors who fund the purchase in exchange for a return 
  • Investing in a property out of state
  • Fixing up and flipping homes
  • Simply buying and holding property

After doing some research, I felt that the best strategy for me, with the lowest barrier to entry, would be to buy and hold real estate. 

I opted to not go the fix and flip route, because I wanted to learn as much as I could about the industry without the added stress of dealing with contractors and construction loans, which can get complicated fast. 

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Another part of choosing a strategy includes figuring out whether you want to be an in-state or out-of-state investor and figuring out the pros and cons of each route. 

I decided to invest out of state in Georgia first because my local market in New York was, and still is, very expensive. But there are more affordable markets out there, depending on what you are looking for. 

I established good credit early on

In real estate, having good credit often means access to funds and favorable rates. From a lender's perspective, credit gives you the opportunity to purchase something today with the promise of you paying them back later.

As a borrower, credit shows how good you are with keeping that promise, and paying back loans in a timely fashion.

I got my first credit card by accident when I was 19. I went into the bank across the street from where I worked to open a checking account to save $100 I had on me and left with a checking account, a savings account, and a credit card.

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I knew nothing about how credit cards worked. The only clarification I got from the personal banker who opened the accounts was, "It's just a card you use and pay back monthly." That was the first and only lesson I got about credit. 

I was concerned about the possibility of taking on debt, so I only used that card for small, everyday purchases, and I made sure to pay it off every month.

In a way, my extreme caution paid off. That first credit card helped pave the way for me to purchase my first property at 21 because within two years, I had a 721 credit score.

I made sure not to take on any additional debt 

Your debt to income ratio plays a major role in the lending process because it determines your ability to repay a loan. Lenders can view a large amount of debt as a red flag. I've learned that your debt-to-income ratio can be the difference between accomplishing your real estate goals and your mortgage application being rejected. 

I was still in college when I purchased my first two properties. But when I bought them, I knew debt could stand in the way of me acquiring more real estate in the future.

In my experience, before the Recession, with some money in the bank, good credit, and a job with a consistent paycheck, I was able to get 100% mortgage financing. And at that time, for some properties, a 20% down payment wasn't required as often as it is now. That is one thing that has changed about the industry since I started.

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I ended up taking on $26,000 of student loan debt to cover some undergraduate courses and my grad school program where I got a Masters in accounting. I was able to pay it off quickly, thanks in part to my income from my properties.

Once I was debt-free, I started looking at properties again. 

My best advice is, rather than buying liabilities which can increase your debt, buy appreciating assets that help you build wealth. For example, I've driven four cars since I started my real estate side hustle and paid for all of them in cash. My current car is one I purchased at an auction in 2017 and it still drives great.

It was important to me that, with my biggest purchases, I don't take on any additional debt.  

I built strong relationships

I've learned that real estate is a group effort, and you need to build a team around you and cultivate strong relationships with financial institutions, lenders, real estate agents and attorneys to help you get the leverage you need to achieve your goals. 

I wanted to buy my first property in Georgia, because of the affordability, weather, and the thriving cultural scene. Although at the time, I was living three hours away, so it was important to work with a real estate agent that I felt I could trust. 

This particular agent owned several properties in the area and was knowledgeable about what to look out for. So we worked out that he would visit a number of properties and then we'd narrow it down from there. 

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My best advice is to search for agents based on the area where you would like to buy, get referrals, pay attention to online reviews, and follow them on social media if they have a presence there. The more information you have, the better.

I have some long standing relationships with several banks where I have personal checking and savings accounts, and credit cards, so when it came time to borrow for real estate, I was a known quantity and a solid candidate.

I made sure I understood the numbers  

If you are thinking about purchasing your first property, get familiar with all the expenses involved after acquisition, like mortgage, insurance, and taxes, because that all will determine if you are running at a profit or loss.

Acquiring a property means you will have to pay for the upfront costs like the appraisal, inspection and application fees, a down payment, and closing costs. Depending on which one you work with, some banks will expect you to have three to six months of the mortgage payment in cash on hand.

The greatest rule of a carpenter is to measure twice and cut once, and this rule applies to real estate as well. If you only remember one thing as a new real estate investor, my best advice is to measure twice by doing this kind of analysis on every deal you come across. 

Ogechi Igbokwe is a financial educator, real estate investor, coach and founder of OneSavvyDollar. Real estate helped her pay off $26,000 of student loan debt, match her 9-to-5 income and helped her build a six figure portfolio. She is the author of the eBook "Don't buy real estate until you read this: 7 steps for buying a profitable rental property." 

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