What do you wish you knew when you started out?

Question

Hi all! After months of research and education, I'm preparing to invest in my first property. I know there is definitely going to be some learning-on-the-go, but what are the top 2 or 3 things you wished you knew when first starting out?

Philip Barr · Answer

One of the best ways to ease fear and stay focused as a new real estate investor is to make sure your investments are well-protected. When you know that your properties are legally separated from one another, it brings peace of mind, so you can concentrate on what you do best: finding great deals and building your real estate portfolio.

I always recommend that clients use LLCs (Limited Liability Companies) to help shield themselves and their assets from liability. Placing each rental property into its own LLC can protect your personal assets and your other investments from liability tied to any one property. It essentially acts as a compartment to seal off liability from that property.  Additionally, setting up a holding company—ideally structured as a Wyoming LLC—to own those rental LLCs adds another layer of protection. This approach can help guard against personal liability and keep potential creditors at bay.Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.

Nadeem Alamgir · Answer

Run your numbers conservatively, build a solid team (they matter just as much as the deal), and don’t wait around for the “perfect” deal.

The biggest trap is analysis paralysis, and the best way to break through it is to take action and learn as you go.

Terrance Teague · Answer

Hi Christine!

Congrats on all the research you’ve put in and on taking the leap into your first investment!

There’s definitely some trial and error involved in real estate, but here are a few things I wish I had really embraced early on:

1. Trust your gut.
If something feels off, whether it’s a deal, a contractor, or even a potential tenant, it probably is. Your instincts are usually based on something real, even if you can’t put your finger on it right away.

2. Don’t be afraid to ask for help.
There’s no reward for figuring everything out the hard way. Surround yourself with people who’ve done what you’re trying to do, and lean on them. The right agent, lender, mentor, or property manager can save you time, money, and stress.

3. Have fun with it.
It’s easy to get caught up in the numbers or stress about making the “perfect” decision, but if you’re not enjoying the process, learning, networking, then it may not be the right path. Real estate should support your life, not drain it.

Wishing you the best on your first property!

Ryan Spath · Answer

• Have a Strong, Specific Lease
Make sure your lease clearly outlines expectations and addresses common situations. Here are two key clauses to consider:

• Early Termination Clause
     Example:

If the tenant seeks to terminate this rental agreement before the lease end date, the tenant agrees to pay [$____], not to exceed two months' rent. The landlord agrees to waive the right to seek additional rent beyond the month in which possession is regained.

• Why it helps: Useful if a tenant needs to      relocate or purchase a home mid-lease—it sets clear expectations and      simplifies the process.
• Holdover Clause
     Example:

The tenant must vacate and remove all personal belongings by 11:59 p.m. on the lease end date. Failure to vacate may result in immediate eviction proceedings. If the tenant remains without a written agreement and the landlord accepts rent, tenancy converts to month-to-month at a rental rate of [$          ]/month, payable in advance, and subject to the lease terms.

• Why it helps: If a tenant needs a short      extension, this clause applies pressure to either move out promptly or      formally renew for another term.

• Separate Banking
Set up a dedicated bank account for all rental income and expenses. This makes tax time easier and helps keep your finances organized and professional.
• Online Rental Payment collection: Tons to choose from, chose one that fits your needs. Rent Redi, Schedule my rent, avail.

Why it helps: Automation is key, most platforms enforce your late fees etc.

Hope this helps, we self manage a dozen doors in two states, feel free to reach out if you have any specific questions. Always glad to help and share what we have learned.

What do you wish you knew when you started out?

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