Why I Don’t Look For Real Estate Deals

by | BiggerPockets.com

I’ve seen a number of threads on the BiggerPockets Forums which indicate a certain level of frustration with the fact that the Multiple Listing Service (MLS) is “too competitive”, and in today’s market it can be quite difficult to get offers excepted on MLS-listed property.  I would concur – it can be very difficult indeed, which is why I do not buy off of the MLS…

I’ve been teaching the violin for over 15 years and real estate for 3, and as a teacher I understand that there is a world of difference between handing someone a fish for dinner verses teaching them to catch their own.  This is why I tend to have a certain amount of distaste for most How To articles.  Life is just not that simple!

I am chuckling at myself because I am currently considering writing an article entitled How I Bought a 10-Plex with 1.5% Down – A Case Study.  Should I write it?  Leave me a comment…but I’ve digressed.

Success, in my opinion, is a function of perspective, and my goal for today’s article is to explore the psychological condition of the marketplace in hopes of encouraging a marginal shift in thinking that will open doors of opportunity.

This isn’t Rocket Science.

Question:         Why is the MLS so competitive?
Answer:           Because too many investors use the MLS as their gateway to the market.

Question:         Why do most investors rely on the MLS to access the market?
Answer:           They either don’t realize that there are other ways of finding deals, or they deem those other ways  “too difficult.”

Question:         What is the opportunity represented by the above?
Answer:           To Zag while everyone else Zigs!

Wouldn’t you agree that when framed in this way the proposition becomes self-evident – we have to do things differently from the conventional.  A place to start is to acknowledge the possibility that there can be a solution other than the conventional wisdom.  Here are a few more questions:

Question:         When you are dirty, what do you do?
Answer:           You take a shower.

Question:         Did taking a shower require carrying buckets of water from the well in your back yard?
Answer:           No, you simply opened a faucet – I hope.

Question:         Are you getting the moral of this story?
Answer:           Say YES!

Indeed, scouring the MLS for property is to me akin to carrying buckets of water.  It can certainly work in a target-rich environment, but even when it does work it requires constant effort.

My preference is to build a pipeline instead.  While this certainly requires considerable effort during the construction phase, in the long run a pipeline facilitates a significantly more passive process of lead-generation.

Related: To Leverage or Not to Leverage – This is the Question…

Inbound Marketing Concept

In the past decade the concept of Inbound Marketing has taken off in a big way.  Unlike yesteryear marketing which aimed at blanketing huge numbers of potential audiences with a constant barrage of sales pitch, inbound marketing aims to position the company or product to “Be Found” if and when the potential client reaches out, and it does so by providing free but good-quality, solid, actionable content.

Think of it this way.  Imagine you are watching your favorite show on TV when you are “rudely” interrupted by a pick-up truck commercial.  Do you immediately drop everything and run out to buy a new truck?  Chances are that you do not, because your old truck works just fine.  Moreover, you would likely be a bit miffed at the rude interruption.  So, you either flip the channel or go pee – the exact opposite reaction from the one that the auto manufacturer was hoping for.

Inbound marketing is different in that folks using it understand that when you are truly ready to shop for a new truck, you will actively search for them, and all they need to do is make you aware of their existence.  How do they do it?

I give you BigerPockets.com.  When you wanted to learn about real estate investing you likely typed “Real Estate Investing” into your search engine of choice and pretty well at the of the first page you saw a link to BP, which you followed.  When you landed on the home page, Josh Dorkin, a serial entrepreneur and founder of BiggerPockets.com, scored a point – he positioned BP to be found by you.  But the game wasn’t over yet, because now he needed you to come back and to engage.  How did Josh Dorkin do that?


Having arrived at BP, you likely stayed until 3 A.M., which ensured that you were a complete and total basket case the next morning at your JOB because all you could think about was how nice it would be to make enough money in real estate so that you would not need that JOB.  After you came home from work that night you went back to BiggerPockets.com to read more, and more, and more insightful CONTENT, such as this brilliant article – now Josh Dorkin had you!

Note to self:  Call Josh and tell him I want more money – or, any money for that matter… Ha-ha-ha

LESSON:        BiggerPockets didn’t find you.  You found BP at exactly the right time in your life and under the circumstances when you were ready to internalize the message.  You were looking for answers and BP provided the answers you needed just when you were psychologically and mentally ready to receive them.  So, you came back and you engaged – and this, ladies and gentlemen, is an inbound marketing success story.

Related: Why Forced Appreciation Makes Multi Family Investing Better, Hands Down.

What Does All This Have to Do with Real Estate?

I don’t look for deals on the MLS or anywhere else.  This may sound strange, but it is the truth – I do not look for deals.  I used to look for deals, but I don’t any more.  People take action around real estate in order to solve a problem, therefore building a pipeline is to me a function of making the world aware that I am a problem solver, and that I have the perspective, experience, knowledge base, desire to help, and capacity to see things through to the end.

By definition, solving a problem necessitates being privy to exactly what the problem is that needs solved.  This requires being eyeball to eyeball with the seller – I have to have access to the seller to do what I need to do!  Is that easy or even possible when working through the MLS do you think?  Is it…?

I’ll be the first to admit that the process of building a pipeline is not quick and it’s not easy.  Why?  Because in order for me to have a pipeline, people have to choose to do business with me – a choice they will not make unless they feel that they know me, like me, trust me, and have faith in my capacity to perform.  Building relationships and establishing a reputation TAKES EFFORT and TIME, but can result in a pipeline of extraordinary possibilities!

What do you think? Leave me a comment below and let’s talk!

Photo: geezaweezer

About Author

Ben Leybovich

Ben has been investing in multifamily residential real estate for over a decade. An expert in creative financing, he has been a guest on numerous real estate-related podcasts, including the BiggerPockets Podcast. He was also featured on the cover of REI Wealth Monthly and is a public speaker at events across the country. Most recently, he invested $20 million along with a partner into 215 units spread over two apartment communities in Phoenix. Ben is the creator of Cash Flow Freedom University and the author of House Hacking. Learn more about him at JustAskBenWhy.com.


  1. Great article, great mindset to have. A good funnel with lots of motivated selling entering your funnel would be an excellent and consistent source of deals. With that said, can you give a list of funnels that investors can create? You mentioned SEO. What would these distressed sellers search for and what content would you offer them? Would you also include reaching out to attorneys such as divorce, probate, bankruptcy, foreclosure, etc? Very interesting article, I very much enjoyed it. I understand in theory, now the challenge is how to apply.

    • Bigo, Bingo, Bingo, Bingo!!!

      Why should a CPA call you and not someone else when his client needs out? Why should an attorney involved in a forced liquidation by way of bankruptcy call you?

      Why? Do you deserve to get that call? It’s not easy!

      • Hi Ben,

        Another great article! And like the contact with the client, I realize it needs to be short and in generalization. However, I know I would be interested in a more in depth discussion of this angle, especially since I’m at that point of my marketing and came to the same conclusion. I work specifically with pre-foreclosure individuals, and generally those in some form of distress. Like you, I’m a problem solver. I’ve found that people are generally lacking in knowledge and when in a state of emotional crisis that lack of knowing what to do couple with the stress has a tendency to paralyze them into inaction. On the flip side, it also seems to make them hyper-sensitive, especially to forced advertising contact. My biggest problem is getting them to make that first contact. Once they have, things typically roll along pretty well and as they realize there are alternatives the paralyzation fades. It’s getting that first contact that is so important. And why I think your pipeline idea is perfect, but like you said, takes time to build that reputation and trust within the community.

        • Thank you Roy,

          There are all kinds of things that people do. I’ve found something out through experience, and it is this:

          People won’t trust you, until they trust you!II Get it?
          This, in large part, is a function of your track record. So FAKE IT ‘TIL YOU MAKE IT!

  2. Michael Woodward on

    Thanks for the article Ben! I’m a huge fan of system-building for passive income so I’m always interested to hear how others are doing it. I used to think that I needed to have my hands in every step of the process until I realized that I was killing my chances for creating a leverage-able, self-sustaining business. I was just creating a new JOB. Terrible!

    Thanks for sharing your perspective, tips, and advice. Thanks also for your recent podcast. More great advice!

  3. Great article, Ben (and YES, you should write your case study on the 10-plex – was that the one mentioned on the podcast?). You do a great job of describing what I want my business to look like in the next 2 to 3 years;however, as a complete new investor, I’m having to augment my inbound marketing machine with scouring the MLS to deals, working with agents, etc.. Hopefully one day soon, my direct mail marketing, website and referrals will keep me busy, but that day isn’t here….yet.

    • Tim Chasteen

      I feel Brandon’s pain on this one. As a new investor I think you have no choice but to use the MLS, REO auctions, and direct marketing to find deals.

      I don’t think people will choose to do business with you unless you have already proven yourself with the deals you’ve made. Of course you mention that’s how you started Ben, so my dream will be to someday have an inbound network as strong as yours!

    • Tony,

      Think bigger than a specific strategy. Think globally. What can you do so that when people “need” help, they will call you? The simplest and most obvious is to send a letter to them, however, this is not “passive” since you need to know who to send it to, which involves some serious research – not easy! But, many people start there.

      I’ve bought off of a flyer in the newspaper before. Figure out your target geographical area – create a catchy flyer insert for the local paper, and pick up the phone. This can work.

      These are not things I do any longer simply because I don’t need to. Then again I don’t do 20 deals per year. Al I need is 1 really good one. When somebody is really really looking for a way out, that’s when I want them to find me – PEOPLE business. This is what I practice and what I teach.

  4. Ben,

    Great article about building the pipeline in order for deals to come to you instead of you finding the deals and wasting that most precious resource called TIME. I am waiting for you to write something on your private money strategies (gleaned from your awesome Podcast) since I am curious how you use them. Are these private money notes that are used for a year until you can Refi, or longer term notes?

    Definitely excited to read about that and the case study you mentioned in this article

    Keep on writing because people like me (recent college grad) like what you have to say.

    • Robert,

      As far as private money goes, it is not a strategy but rather a global perspective. I have used everything from 15 days to 7 years. Each deal is different, so is the financing package.

      Private money is tough – it will not come until you are ready, and being ready is a function of your intellectual worth. Keep studying and send me a colleague request on BP – we’ll talk 🙂

      Thanks a lot for reading and commenting Robert!

  5. Thank you for a great article. As someone that is starting out in the real estate investing business I read, listen to or watch anything that provides useful information. I would like to read “How I Bought a 10-Plex with 1.5% Down – A Case Study”. I will be looking for that new article. Again thanks for a great useful article.

  6. karen rittenhouse

    Hi Ben:

    We started investing in real estate by looking for deals. As you described, that’s slow and takes a lot of time and effort.

    Our world changed when we began direct mail marketing. Having sellers call us instead of us calling them makes all the difference, beginning with the fact that they know who we are and know from the beginning that we don’t pay retail.

    Thanks for the post.

  7. John Thedford on

    Great article. Do you utilize such items as a website aimed at potential sellers? This seems like it could be a good approach as long as it is designed in such a way that sellers actually find it out of the billions of sites. Would you be more specific in how you built the pipeline or what methods it employs?


    • John,

      A website may be a good option to consider for anyone in the SFR space. I buy exclusively multi-unit buildings, so I do not utilize in-bound concept on the internet for acquisitions. Furthermore, as you’ve rightly alluded to, it can be quite difficult to “stand out” because everybody is doing it.

      For SEO purposes, order to stand out one needs to pump out high volume of fresh content and be active in other ways. That’s not passive – that’s a job! This is what I do for JustAskBenWhy.com – I am aware that it’s a job, but I chose to do it for now.

      When I speak of in-bound as it relates to RE, however, I don’t necessarily mean internet network, just a network, if that makes sense 🙂

      Thank you for reading and commenting!

        • Sheri,

          I don’t look for deals – quire literally. I don’t prospect – not directly any way. Instead, I do my best to place myself into people’s consciousness and encourage them to come to a conclusion, which seems natural to them, that I am the go to guy. For this I use all available to me means of persuasion. You are focusing strictly on specific techniques of lead generation. Those are fine and dandy, but nobody is going to do a deal with you unless they feel like they know you. We are talking about image-building here. To me, if the big picture works, then the leads come on their own.

          Sheri – if you get a moment Google the word Enthymeme and syllogism. Understanding those will help you to begin putting inbound lead generation into perspective. Perhaps this would make an excellent article in the future 🙂

  8. When we started our construction company about six months ago by soliciting manage companies with a lot of properties. As we build our name and reputation for doing good quality work on time and budget they now call us. Just met with a paint supplier today to our lumber yard, manager brought to us in person because the other contractors he deals with are not as diversified and knowledgeable and the manager knows we are growing fast. We are getting to the point jobs are coming to us with little advertising cost or effort. That is the paradigm I want my REI in so I can devote time to better returns and continuously improvements.

    I got tired of the silly HUD bid wars and people that pay too much for them, so today I went to the sheriff’s office sales for the first time to see what I could learn. The room was full of RE attorney’s representing big fish banks like BOA, Wells Fargo, etc…..I struck up a conversation with one in the elevator on the way out that had a lot of cases asking him about liens, mortgages, redemption rights, etc., and due diligence He offered to help me understand my states legalities next week’s meeting. Hard to find that on BP, way I figure it let them teach me, I’ll get to know them and when they have a smoking deal that can’t figure out hopefully they’ll call me so I can apply one of Ben’s creative finance strategies. 🙂

  9. Great article, and I love the humor. Let us know when Josh sends you that fat check 😉

    I’m interested in more specifics on your pipeline. You mention networking with others personally, but I’m sure you’re doing more than that. Care to elaborate?

  10. Robert Steele on

    Unfortunately for the person who just wants to invest in one or two properties setting up “the pipeline” is overkill and will take way too long. That is why the MLS is so popular.

  11. About 3 months ago I got all fired up to buy my first rental house. Now I found out that this house most likely does not exist or even if it does, I have no way to buy it at the price I want to pay. I also found plenty of competition. All these “we buy ugly houses”, “ca$h for homes” signs tell me that there plenty of people who would snatch that property I am looking for at the blink of an eye before I even consider it.
    I heard many times that RE investors solve problems. However, I don’t see how I, having no REI experience or significant amount of money (10K is a small change in RE world), can solve anyone’s problem other than lining up pockets of “educators” or “wholesalers”.
    As they say: “If you don’t know who the patsy is, you are the patsy”. I don’t want to be the patsy. What options do I have other than not participating?

    • Nick,

      Here are a few options:

      1. Consider buying on a land contract
      2. Consider buying with a lease option
      3. Consider getting a money partner
      4. A lot of people buy Sub2, although I am not a fan and can not recommend
      5. Consider wholesaling
      6. Consider calling me up to talk things over 🙂

      All of the above can be accomplished with 10k – I promise. OK – so, you are not going to look for deals that can be done this way on the MLS. MLS is for cash buyers, and you are not a cash buyer. You have to be more creative than that,

      You are lacking experience and knowledge – there is no shame in this. All of us were there at one time. Do something about!

      You complain about “lining educators pockets.” Fair enough, however, we are not dealing in widgets here. We play with hundreds of thousands of dollars. True – a $5,000 course may only yield $10 worth actionable information. But, also true is the fact that in this business $10 of the right kind of information could make you 500k.

      Don’t get frustrated. Get educated!

      • Ben,

        Thank you for your reply. Let me comment your pullet points:
        1. Owner finance? Possible but why would a distressed seller finance anything if they are facing a foreclosure?
        2. Same. Rent to own? How does it help me? I want own to rent
        3. Good idea but all people I know either have little money or would not lend me anything without guarantees. I more than once offered different “money” people various investment ideas only to hear: “I’ll participate if has no risk of loss”.
        4. Not sure what “sub2” means. Google finds “subject to…” contracts. Is this the same as having property under contract and then re-assigning it to another buyer?
        5. Full time job. I already have one and my goal to get away from it.
        6. Definitely when I have more knowledge and/or a ready to go deal 🙂

        Now, financing is not my primary concern. I could borrow from myself (401k loan) if I could find a deal that cannot lose. E.g. I can borrow 50K from 401K today to buy a house for 50K if I know that I will resell that house for 100K a week from now.
        However, I have no idea where to find such a deal even though I keep reading and hearing about them all the time.
        Like you said MLS is not good for this. Craigslist is the same.


        • Nick,

          1. Did I mention buying REOs? I don’t remember saying that 🙂 There are many kinds of distress…Does the property have to be in default necessarily? I let guys and gals who don’t know anything except buying foreclosures fight it out – I don’t’ buy foreclosure necessarily. I mean, I will if it’s there for me and it works, but there are many other opportunities out there
          2. If you don’t know people who could go in on a deal, then you are hanging out with the wrong kind of people. This isn’t a judgment, but it is the truth – Tell me who your friends are, and I’ll tell you who you are.
          3. Sub2 is taking property over subject to existing financing. I do not recommend doing this by and large for many reasons, however it can be done and many do make a lot of money with this tool specifically in this market. Research this to understand if it’s right for you. If you do decide to go with Sub2, look into land trusts as well.
          4. I couldn’t agree more about wholesaling. But, beggars can’t be choosers 🙂
          5. Nick – you are lacking perspective and education. You are exposed to common wisdom which is prevalent in the marketplace and is propagated by the gurus. There is no such thing as a magic bullet. There are no such things as guarantees. If you want risk-free, keep the money in the mattress. Success is a function of knowledge. You’ve got potential for sure, but at the moment your attitude can be summed up in the following way: You hear the bells wringing in the distance, but you can not see them. You know they are there, but you just can’t see them. Nick – you are in a dangerous place specifically because you havemoney to spend. This means you havemoney to loose! Invest in you education first, property second…It’s up to you, but I would suggest you look into CFFU on my website. I think you’ll really benefit from it, and it wont set you back much 🙂 Good luck

        • Nick,
          You still struggling? I want to say all the above (your numbers) I want to put my two cents in. What Ben says is really true. You can do all that with under 10 grand. Sometimes nothing.
          1. Owner finance? Possible but why would a distressed seller finance anything if they are facing a foreclosure? —-They will trust me. Some will just be pissed but many will thank you. You get them out of foreclosure and give them a little capital to move and get a place. Many more reasons.
          2. Same. Rent to own? How does it help me? I want own to rent –Real estate is not just owning but controlling. If you can rent to own a property and sell that lease or even stay in the middle and make a profit why not? There is risk but thats why you can make money.
          3. Good idea but all people I know either have little money or would not lend me anything without guarantees. I more than once offered different “money” people various investment ideas only to hear: “I’ll participate if has no risk of loss”. ———-Hard money is easy to find private money (like yourself is harder to find) but its out there. Not always your friends and family. You already have the money (your 401) though which is 1/3 the battle. You need help finding a property.
          4. Not sure what “sub2? means. Google finds “subject to…” contracts. Is this the same as having property under contract and then re-assigning it to another buyer?—Sub 2 is in easy terms taking over or assuming the loan without the banks permission. I do it, it works but there are some possible drawbacks although usually the risk would be on the seller but ya you could also sell your sub2 contract and get out.
          5. Full time job. I already have one and my goal to get away from it. ——wholesaling is not a full time job, I don’t care what all the “guru’s” here on bigger pockets say. It can be if you want it to be –more money :)– but if you put a system in place you can cut your time down.
          6. Definitely when I have more knowledge and/or a ready to go deal 🙂 ——-Call me too lol jk Im in washington state and im just commenting.

          Make this short. You just need to find deals it sounds like. Call wholesalers up buy from them. You have the money or at least a way to get it. If you can’t find a real wholesaler keep looking. Yes you can find deals on mls they are harder to find though. Get a few realtors involved to send all reos or lowest price houses in there area to you every few days sift through them, then make lowball offers on the fixers only. Craigslist does work . Mls and craigslist will be more work though but you will find deals if your looking. Or do your own direct mail or bandit signs.

          Good luck man.

        • Hi Rook,

          Thank you for chiming in. I am struggling primarily with my fear of financial loss. Everything else stems from it. That’s why I want my first deal to be perfect and make money from the day one.

          As for finding deals, I contacted several wholesalers and got the following types of responses:
          – I already have enough buyers and don’t want to deal with yet another one
          – Sure, here is list of my properties – none of them make sense in terms of numbers.
          – Sure, I’ll give you a list but I want to meet in person and have you sign a non-disclosure agreement. Oh and by the way, we have a contractors, bankers, realtors, etc., so you don’t have to look for them.

          I guess I’ll keep educating myself (as in “reading books”) and try different wholesalers.

          BTW, how do I know if a wholesaler offers me a good deal? He already added his markup to the price, so whatever is left is probably a market price less repairs. Not a good deal. Am I correct?

        • Nick,
          You say your worried about financial loss correct? So this is one thing that gets a lot of people. Im not saying there is no risk but the main risk is your credit and losing the house you didn’t have before you started. Now im not saying that there’s no chance to get sued for your personal stuff as well but that is extremely extremely odd. I suppose it would depend on your state as well. Heres the thing. You can always claim bankruptcy, and I do not advocate it but that is a last resort. It is why its there. If you don’t take any chances then you won’t ever get to the upper level. Walking down the street is a risk.

          I have gained huge and lossed huge. 6 or 7 years ago I almost lost everything I had –not quite everything but most– I made too much to claim bankruptcy which was fine but the thing is, I only lost the stuff I had gained from real estate. I also took a huge hit on my credit which as of this month is good again. But that didn’t stop me. I did take a pretty long break from real estate but Seriously I took too long. I never should have took the break.

          Because of my credit I had to do this stuff without credit and it made me a better investor. You don’t need it. So don’t let the fear get you down. The other thing with that is if you are using hard money or private many of them will not go after you personally if setup right. They know the risk. They will take the property themselves and hold it. Not saying all are like that but the good ones don’t make you attach yourself to the deal personally. They won’t fund it unless they think its a good deal, and they understand if it goes south. –might not be happy but they understand the risk– They charge hefty fees because of the risk but there you go. Yes most want you to have some money involved but there are plenty of ways to deal with that. This is getting long so Ill stop it here, look I actually had a post on one of my blogs where you were brought up in a comment (I actually thought it was you signing someone elses name) They had followed me from one of the bp posts and had a similar question, go there if you still have questions email me and Ill call you and talk to you. Let me know your market area. Im in Wa state so rules might be different. For some reason I feel the need to help. One guy I sent to biggerpockets, he was in florida and he sent me a big thank you. So normally Id refer you here lol but go ahead and take me up on the offer.

        • Hi Rook,

          First of all I did not comment one your blog – I did not even know about it until today. I have a common name and common fears though, so I don’t mind if someone else expressed thoughts similar to mine.

          Now, on the subject. As strange as it is, I don’t care about my credit. I have 800+ score and have no idea what it’s good for as don’t plan to have any personal debt once I pay off my mortgage (16 month are left).

          What I fear is the loss of uncertain amount of money. You see, if I have a certain and guaranteed loss, I am OK with it. For example, I don’t care about my car’s depreciation or property taxes I pay on my house. These are certain losses that I know I will have and there is nothing I can do about them and I get something in return. They are also limited.

          But if I enter in a transaction where I may gain or lose and neither is certain, that drives me crazy. For example, if I bought a stock I would either sell it for a smallest gain possible (hopefully next day) or for a biggest loss (may take a year). Been there, done that, and don’t buy stocks anymore.

          Now I suspect that the same twisted line of thinking would apply any other investment e.g a rental house. The only way I could do it if the deal is so good that I cannot lose on it even if I literary sell it to a highest bidder on the next day after I bought it.

        • Nick,

          There are so many things I could say. You have given me material from at least 4 articles 🙂

          Fear is not a bad thing in and of itself Nick, but misguided it can be paralyzing. What you are looking for does not exists – there are no risk-free investments; by definition there aren’t! I could give you a house with 60% and I am certain that you would find a way to screw it up and lose money, which brings me to the 3 points I’d like to make:

          1. Risk can be avoided – this is what you are doing now by keeping money on the sidelines. Obviously, though, even now you loose, because unless you earn at least 3% after-tax you loose value doe to inflation. I think you know this, which is why you are looking for answers.
          2. Risk can also be managed – this requires KNOWLEDGE which you lack, and confidence in yourself, which you also seem to lack.
          3. Success does not happen inside your comfort zone Nick! Let me say this again: SUCCESS DOES NOT HAPPEN INSIDE YOUR COMFORT ZONE. If you do the same things the same way, you will achieve the same kind of results that you always have. If you want more out of life than that, you will need to step outside of your comfort zone – period!

          So Nick, you are looking for risk-free investments which do not exists by definition, and you are looking for success inside your comfort zone, which also does not exist. Why are you surprised that you can find neither?

          I am a father, husband, professional investor, writer, teacher, and mentor to a few select people. You NEED to educate yourself. If you want, go to http://www.JustAskBenWhy.com , click on “Contact Ben” tab, pick up the phone and dial the number…

          Good luck Nick!

        • Hi Ben,

          I am glad I can help you with material for your articles 🙂

          You’re right about knowledge and confidence. I lack both but I am working on the easy part – knowledge. Reading books, going to occasional seminars, etc. Confidence is another matter – it’s a catch 22 – I would have it if I had a successful deal but to have a successful deal I need confidence.

          You’re wrong about risk-free investments. They do exist but they come and go quickly or have some limitations.
          For example:
          – Leveraged Savings & CDs (not at this time though). In 2004-2008 I ran a “nano-hedgefund”: borrowed money from 0% interest credit cards and invested in FDIC insured CDs at 4-5%. Infinite ROI and no risk. The limit was how much I could borrow.
          – 401k match – 100% company match = 100% risk-free ROI in my case. Limit – up to 6% of salary.
          – Employee stock options – all gain and no pain.
          – Employee stock purchase plan – you buy company stock at at least 15% discount and immediately hedge or sell. 15%+ risk free but limited to 10% salary.
          – Any income producing investment that produced enough income to pay for itself – once your properties are paid for you have no risk in terms of lost initial investment. Dividend paying stock that were bought 20 years ago and paid for themselves are in the same category.
          – Sweepstakes – I never won one but it costs nothing to enter, hence a potential risk-free windfall.

          I can go on but you got the idea.

          You’re right about comfort zone. Last time I got out it was when I immigrated to the USA. I am from Russia, just like you’re. Did I take a risk? Absolutely. Was it worth it? You bet. But this was a different kind of risk or maybe it was the fact that I was 15 years younger. I don’t know…

          I’ll call you some time.

        • Nick,
          Love this conversation hope everyone else is getting some value in it.

          Your above mentioned arent risk free anymore than when you lost in the stock market. I’ll explain when I get to a computer. Phone is tough 🙂

    • I see a man. He is a middle-aged immigrant from Russia, with black hair which has substantial white in it, and dark brown eyes. He is an extremely smart and highly-educated guy. He is a high-level specialist in his very narrow field. He is revered by coworkers and bosses.

      Because he is so GOOD at what he does, he would be very, very, very difficult to replace, which gives him as much job security as is possible to achieve in America. The company would literally have to go belly up for this guy to loose his job.

      He is extremely conservative and risk-averse. He is a saver. He does not invest. He never looses big relative to finances, but he never wins either…

      Is this guy you Nick? May be not, but it most certainly is my father – one of the most brilliant engineering minds out there. Reading your writing brings his image before my eyes Nick.

      Nick – I think you should give me a call some time. At the very least, I think you would enjoy the conversation 🙂

    • Brian,

      Private banking is a terrific idea if you have properties to buy. However, I have no idea how to find them.
      Besides, people will want guarantees that I cannot provide.


      • Nick, I feel your pain! I still don’t get the concept of how to get sellers with equity to come to me without me going out to find them first. It reminds me of the book that was really popular a few years ago, The Secret, with the concept that positive thoughts are a magnet.

        • Oh, you may have to go to them Sheri. But, why would they listen to you even if you came? Sellers with equity have options…I want to say the same thing to you asI did to Nick directly above. Please read it. Understand – I studied for 7 years before doing my first deal.

  12. Ben,

    For some reason I cannot comment to comment so I’ll reply here.

    I agree with most of you say. However, spending 7 years before buying first property may not be an option for me. I’ll be almost 50 by then. At that age I should be enjoying passive income already not just starting out.

    As for education, I looked at your site and checked out your curriculum. I know most of that already and I can get the rest from various books and BP forums. I know what kind of property I want to buy, how to finance it, who I would rent it to, etc. The problem is that I have no practical experience and I have a fear of loss and failure. That’s why I need someone to be my sponsor and walk me through the first deal while providing a safety net.

    I want my first deal to be successful. Second, third, nineteenth could a failure. But the first one must be perfect. Then and only than I will gain enough confidence to move forward.


    • Ned,

      Unfortunately it wasn’t me; I it it were. But I’ll tell you this: I want to buy in a way that works – the MLS doesn’t work 🙂 By the way, I’ve started working on the article we discussed a few days back. Give me a couple of weeks.


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