Real Estate: The Sexy and the Stupid

I have been investing in real estate for 10 years. I have gotten into some pretty interesting deals... like flipping a short sale (legally) in 6 weeks, no money in, making $46k. The day I bought my first house, I bought two ... with no money down.  I went on to buy another dozen more, or so ... with little or no money.  That all sounds pretty sexy right?

Here is the thing. Yes, I did all those things. I have flipped. I have sold. I have rented. And, I have lost.  Big time.

We miss a large part of our business, talking, mentoring and educating others and ourselves on risk.  Whether you are brand new, currently doing a few deals, or the big time investor, we have to talk about risk. Understand our upside, and understand if all hell breaks loose, what is our exit strategy. 

I see posts all over bigger pockets about how people want to buy properties with no money down, want to have 50% of the pie but no idea what they are doing, no experience, and no money. It's time for us as investors to also be honest, there are things that really suck.  There are nights I have been up all night upset, mad, frustrated with myself.  I have come to closing to pay money just to get out of a deal.  I have made much more terrible decisions, purchases, and deals ... than that.

All along, I could have made different choices.  But through my deals I have also learned a lot, and in each deal (including my current rental house we just bought, and the $1,200 gas line I just learned about I get to put in after the entire make ready is done ... and tenant moves in, well, tomorrow) that we aren't perfect.  We are working towards putting our systems in place that work for us.  We want to hone the deals that more and more limit our risk.  And understand the deals more clearly, more concisely, and more quickly, as we continue to run and execute our business. And, to make sure we have people around us who understand our business, are supportive, and who also know when to call us out when we are doing something, well ... stupid!

If you are a newbie real estate investor, with no money, fire in your pants, and the goal to go buy a 100 unit complex tomorrow, that is awesome. But seriously, that might be really, really stupid. Make sure you are honest with yourself, that today you might be signing on the line, and tomorrow you might be in bankruptcy court, holding your spouses hand, trying to figure out what the hell you just did.

Because, I've been there too.