New to RE investing - finding the right deal
Member since 2026 · 2 posts · 5 votes
New to RE investing - finding the right deal
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Arman AhmedPro Member
Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 939 votesQuote from @Richard Dominguez:
I'm just starting out. Got my down payment and preapproval. Looking to buy my first 4 plex in the seattle area. I'm trying to find a good deal as I'm scared of getting into a bad one.
There's alot of money in this market. I'm worried that I'll get too caught up on finding the right deal that I'll miss on opportunities. Any guidance on walking the line between acting and having analysis paralysis? Thank you!
What you’re feeling is pretty normal right before your first deal, analysis paralysis usually shows up when you’re trying to eliminate all risk, but real estate never gets to zero risk. The goal isn’t finding a perfect 4-plex, it’s finding a solid one where the numbers work even if a few things go wrong. I’d focus on underwriting conservatively, knowing your worst-case cash flow, and then setting clear criteria so you don’t keep rewriting the rules every time a new listing pops up. In expensive markets like Seattle, that hesitation gets amplified because the margins are tighter. That’s why a lot of first-time investors end up testing their first deal in more forgiving Midwest markets, where entry prices are lower, and mistakes are cheaper while you’re still learning the process. The key is acting once a deal meets your criteria, not waiting for a deal that checks every emotional box.
8 Replies
- 3moArman AhmedPro MemberReal Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 939 votes
Quote from @Richard Dominguez:
I'm just starting out. Got my down payment and preapproval. Looking to buy my first 4 plex in the seattle area. I'm trying to find a good deal as I'm scared of getting into a bad one.
There's alot of money in this market. I'm worried that I'll get too caught up on finding the right deal that I'll miss on opportunities. Any guidance on walking the line between acting and having analysis paralysis? Thank you!
What you’re feeling is pretty normal right before your first deal, analysis paralysis usually shows up when you’re trying to eliminate all risk, but real estate never gets to zero risk. The goal isn’t finding a perfect 4-plex, it’s finding a solid one where the numbers work even if a few things go wrong. I’d focus on underwriting conservatively, knowing your worst-case cash flow, and then setting clear criteria so you don’t keep rewriting the rules every time a new listing pops up. In expensive markets like Seattle, that hesitation gets amplified because the margins are tighter. That’s why a lot of first-time investors end up testing their first deal in more forgiving Midwest markets, where entry prices are lower, and mistakes are cheaper while you’re still learning the process. The key is acting once a deal meets your criteria, not waiting for a deal that checks every emotional box.- Member since 2026 · 2 posts · 5 votes3mo
Quote from @Arman Ahmed:
Quote from @Richard Dominguez:
I'm just starting out. Got my down payment and preapproval. Looking to buy my first 4 plex in the seattle area. I'm trying to find a good deal as I'm scared of getting into a bad one.
There's alot of money in this market. I'm worried that I'll get too caught up on finding the right deal that I'll miss on opportunities. Any guidance on walking the line between acting and having analysis paralysis? Thank you!
What you’re feeling is pretty normal right before your first deal, analysis paralysis usually shows up when you’re trying to eliminate all risk, but real estate never gets to zero risk. The goal isn’t finding a perfect 4-plex, it’s finding a solid one where the numbers work even if a few things go wrong. I’d focus on underwriting conservatively, knowing your worst-case cash flow, and then setting clear criteria so you don’t keep rewriting the rules every time a new listing pops up. In expensive markets like Seattle, that hesitation gets amplified because the margins are tighter. That’s why a lot of first-time investors end up testing their first deal in more forgiving Midwest markets, where entry prices are lower, and mistakes are cheaper while you’re still learning the process. The key is acting once a deal meets your criteria, not waiting for a deal that checks every emotional box.Thanks Arman. I appreciate your input and context. I'm looking to househack so I would be living in one of the units. Although nothing I have found would be cashflow positive, it would significantly decrease my personal cost of living as the delta between the payments and rental income would be less than what I'm currently paying in rent. Just kind of lost trying to figure out what would makes sense
- Rental Property Investor · Everett, WA · Member since 2015 · 458 posts · 386 votes3mo
@Richard Dominguez What areas are you currently focusing on King or Snohomish County? The market for two to four unit properties can be pretty competitive depending on the condition and area. At the moment, interest rates are up so properties are sitting a little bit longer. This can help you negotiate for seller concessions or credits towards closing. I like credits at closing as this will lower the amount you need to bring to close but the seller still feels good that they "got" their sales price.
Don't forget to account for the rules governing rent increases in your underwriting. It's common to see properties with really below market rents. Just know you may need multiple years to bring them up to market value.
You are never going to feel totally certain that the property you decide on is the perfect one. Just remember, this property is just one step on your journey. You take the good, learn from the bad and continue moving forward.
All the best.
John
- Realtor · Hanover Twp, PA · Member since 2018 · 3k+ posts · 3k+ votes3mo
@Richard Dominguez, a few thoughts:
1. When you are just starting out, you shouldn't be worried about losing money! This is INVESTING and by definition that means there is a "risk of loss" unlike your savings account in the bank which is insured.
2. Identify the likely ways things will go sideways, how often they will happen and how impactful they will be.
For example, how often would you expect to evict a tenant? How long will it take in your state to oust them? How much rent will you lose in the process? What is the average damage you will eat to prep for the new tenant, this will depend in part on how hands-on you are?
3. If you identify some of the risks you are scared of and assign some order of magnitude numbers to them you can take away the fear. Now make sure you can handle those scary things. Maybe it is having reserve funds, maybe its developing a relationship with a lawyer to do evictions, OR learning the process to do it yourself well.
4. When it comes to finding deals, underwrite a LOT of them. The more you do the more things will become clear AND the more confident you are in what you are doing.
5. When underwriting deals, do NOT accept what is advertised to you as "fact". Challenge any number given to you by the listing agent or owner.
For example, a listing agent might say a vacant rental will rent for $2,000/month. Do not accept that number, do your own analysis because you may find $1750 is more appropriate.
6. Make sure to underwrite/budget for soft expenses like Cap Ex, Vacancy, and Repairs/Maintenance.
7. Scrutinize the utilities! In some places some utilities are provided by local government entities. Those utilities many times can become liens on the property if unpaid! This can vary from municipality to municipality, so its easy to miss.
If a government provided utility is a flat fixed price, its usually just baked into the rent price, BUT if the utility provided is based on usage like water then it often makes more sense for the landlord to pay it and then bill it back each month to the tenant. This way the landlord maintains control of the bill that could potentially become a lien.
8. If you work at it a deal generally becomes BETTER over time!
Market rents increase... Property values appreciate... You improve the property itself (forced appreciation)....
In addition, later on, you may take other actions like refinancing the mortgage to a lower rate and re-amortizing (stretching out) the payments again thus lowering your payment and increasing cash-flow.
A deal you hold a long time is not static. What it looks like in year 10 may be a fair bit better than year 1.
- Real Estate Broker · New York, NY · Member since 2020 · 2k+ posts · 1k+ votes3mo
Richard,
One thing I heard early on that stuck with me is: you'll never feel ready because ready isn't a feeling.
That said, you don't want to confuse taking action with being reckless. My suggestion would be to analyze a lot of deals before buying one. The more properties you run numbers on, the quicker you'll recognize what's good, what's bad, and what's just average.
I think analysis paralysis usually happens when you're trying to find the perfect deal. In reality, most successful investors are looking for a deal that meets their criteria, not a perfect one.
You've already got your down payment and preapproval, which puts you ahead of a lot of people. Keep learning, keep underwriting deals, and trust that your confidence will come from repetition, not from waiting until you feel 100% certain.
I'm a broker in the NYC and Long Island markets and work with a lot of first-time buyers and investors. My DMs are open if you'd like to connect and talk shop.
- 3moAlfath AhmedBusiness MemberReal Estate Agent · Columbus, OH · Member since 2022 · 1k+ posts · 1k+ votes
Quote from @Richard Dominguez:
I'm just starting out. Got my down payment and preapproval. Looking to buy my first 4 plex in the seattle area. I'm trying to find a good deal as I'm scared of getting into a bad one.
There's alot of money in this market. I'm worried that I'll get too caught up on finding the right deal that I'll miss on opportunities. Any guidance on walking the line between acting and having analysis paralysis? Thank you!
Are you buying solely for the appreciation and equity factor? Most RE investors tend to look OOS into the midwest because prices are cheaper, state is landlord-friendly, and west coast tech companies are investing.
ReafCo | Ahmed Group 536 Reviews - 3moSean SmithBusiness MemberReal Estate Agent · Seattle, WA · Member since 2020 · 164 posts · 105 votes
@Richard Dominguez exciting! There is a lot of negotiability in the 2-4 unit segment right now. Rates are scaring off a lot of the traditional buy-and-holders. Recently I've landed some of my clients house-hacks with solid numbers in West Seattle, Matthews Beach, Ballard, Bremerton, University District, Ravenna, etc. There are a few I'm looking at now that have sound financials - happy to share how I run my numbers/analysis
Fellow Real Estate Services537 Reviews
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