Biggest Fear for Newbies

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Biggest Fear for Newbies

Jon Lee
Investor · Las Vegas, NV · Member since 2014 · 471 posts · 241 votes

Every investor no matter how experienced was a "newbie" at one time....everyone had a point where they were starting out.  

For all the NEW INVESTORS out there....what IS your biggest fear and how DO you plan to overcome it?

For all the VETERAN INVESTORS out there....what WAS your biggest fear and how DID you overcome it?

For example...when I started almost six years ago...I was terrified of not seeming "credible" as an investor until I completed my first deal.  I overcame that by committing to the process of becoming educated and scrutinizing multiple potential deals until I completed my first two flips at the same time.  Working through the process to find those first two flips in a competitive market (Las Vegas) helped me overcome the credibility anxiety.

Please share as much as you like so others can benefit from your current or past experiences.

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Bob Razler
Rental Property Investor · Boca Raton, FL · Member since 2017 · 329 posts · 237 votes
9y

Hello:

My biggest fear is that life has no intrinsic meaning or value.  That a single human or even the entire human species is insignificant, without purpose and unlikely to change in the totality of existence.  That each individual is an isolated being born into the universe, barred from knowing "why", yet compelled to invent meaning.

My second biggest fear is Jell-O.

After that, I worry most, like @Brad E. , that I make a mistake so big that it hinders my ability to move forward at the pace I desire toward my REI goals.

Bob

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  • Jon Lee
    OP
    Investor · Las Vegas, NV · Member since 2014 · 471 posts · 241 votes
    9y

    @Shenise America Tavares...I don't take your fear lightly AND it really is as easy as you see when you run numbers on a calculator.  I HIGHLY suggest that you connect and network with experienced investors in your area.  If you bust your rear to take action...there are folks who will meet you halfway.  Find a local investor meeting and connect with those who can help you.

    0Reply
  • Jon Lee
    OP
    Investor · Las Vegas, NV · Member since 2014 · 471 posts · 241 votes
    9y

    That's right @Jake Hart...numbers won't steer you wrong.  $500 monthly cashflow is not bad at all....especially when considering you ONLY put in $18k.  On it's face...that's a 33% cash on cash return...that is smoking hot return on investment!!!!!

    0Reply
  • Phil Allen
    Eugene, OR · Member since 2017 · 7 posts · 2 votes
    9y

    Fear? I would say time. Also trying to commit to one thing but always thinking about what @Bob Razler said. Thanks Bob:)

    1Reply
  • Bob Razler
    Rental Property Investor · Boca Raton, FL · Member since 2017 · 329 posts · 237 votes
    9y

    Don't blame me @Phil Allen .  Blame Jean-Paul Sartre.  :-)

    0Reply
  • Kristal Pecherski
    Austin, TX · Member since 2017 · 14 posts · 1 vote
    9y

    Newbie here: 1) finding a good deal 2) cash needed/financing

    1Reply
  • Brian Haase
    Enola, PA · Member since 2017 · 12 posts · 3 votes
    9y

    My biggest fear is making my 1st purchase and it goes horribly.  On a recent podcast the guest said to try and make your 1st investment a homerun.   Using that analogy creates a lot of pressure to find that perfect deal.  My wife and I like our W2 jobs and aren't looking to get rich quick.  This investment plan is more of a secondary stream of income for the retirement years.  In our 401k's we can blame everyone else for poor performances.  In real estate the blame falls right at our feet if we don't buy and manage effectively.   

    0Reply
  • John Olson
    Investor · Atlanta, GA · Member since 2016 · 13 posts · 15 votes
    9y

    I am a new investor and for me it was always negative thinking and the thought of massive failure.  I remember asking myself: Will I buy a flop? will my tenants take advantage of me? can I handle the repairs? Or will my wife divorce me over this?  These were all stifling thoughts. However, one thing I have learned is that you must accept failure on some levels to succeed.  I have five units now and I learned that there is no teacher as impactful as the sting of failure.  The lesson here is that we must use these experiences as unique information, and adjust our strategy and approach the next time around, so we have an advantage that no one else does.

    2Reply
  • Mike Burke
    Barnegat, NJ · Member since 2017 · 18 posts · 6 votes
    9y

    @Jon Lee My biggest fear is trusting my numbers. When a deal makes sense I keep thinking I am doing something wrong. I will overcome this by just doing it and not worry as much. My 2nd fear is contacting some (direct mail) and sounding like a complete idiot so I am delaying it. I will overcome this by taking others advice and just doing it, over and over. If it doesn't work I will change how I do it. 

    0Reply
  • Greg Lott
    York, PA · Member since 2017 · 27 posts · 13 votes
    9y

    I'm a complete newbie and own 0 properties. Currently, my biggest fear is buying a property that doesn't cash flow well and is a problem child. I'll do my best to mitigate this through research, but in the end, it still may happen. The best thing to come out of a situation like that is the overall learning experience. I learn best through failure. As Michael Jordan said, "I've failed over and over and over again in my life. And that is why I succeed."

    1Reply
  • Rich S.
    Central, MN · Member since 2015 · 148 posts · 184 votes
    9y

    Biggest fear.... being on this site 10 years from now, realizing I have done nothing in real estate... watching the "leap of faith" folks, talk about how much their business has grown over time...long time lurker... kicked lots of tires... trying to get over the hump and flip that first property... feel the next step is "just do it already".... 

    1Reply
  • Michael Gellar
    Investor · Chicago, IL · Member since 2017 · 9 posts · 4 votes
    9y

    I recently completed my first deal but my biggest fear was putting down the down payment. I live in Chicago and decided to invest in a multifamily. Coming to grips with moving from a investment strategy (stocks, bonds, mutual funds, etc) which I am comfortable with to real estate was the biggest hurdle. 

    Mike

    1Reply
  • Jon Lee
    OP
    Investor · Las Vegas, NV · Member since 2014 · 471 posts · 241 votes
    9y

    @Kristal Pecherski....Especially starting out; it's always harder to find the property than the money.  Just know that if you have a property structured "deal"...there will always be money available whether it's hard money, portfolio lending, or private money.  Focus on finding the "deal"...the money will be waiting.

    0Reply
  • Jon Lee
    OP
    Investor · Las Vegas, NV · Member since 2014 · 471 posts · 241 votes
    9y

    @Brian Haase...don't know if you are focusing on flips or buy & hold but as long as the deal is strustured properly according to you invesitng model..you will be fine.  Best to keep it conservative since it's a secondary income for you.  Best of luck!

    0Reply
  • Jon Lee
    OP
    Investor · Las Vegas, NV · Member since 2014 · 471 posts · 241 votes
    9y

    Well said @John Olson!

    0Reply
  • Jon Lee
    OP
    Investor · Las Vegas, NV · Member since 2014 · 471 posts · 241 votes
    9y

    @Mike Burke...practice talking to sellers by calling Craigslist ads.  For each call focus on only three things: 1) build rapport; 2) Dig for distress, motivation, and/or  flexibility in the seller; 3) write down on paper whatever the sellers says...no matter how crazy what they say sounds.  

    You don't have to know everything...people sell to those they like.

    Hope this helps!

    1Reply
  • Jon Lee
    OP
    Investor · Las Vegas, NV · Member since 2014 · 471 posts · 241 votes
    9y

    @Rich S....be M.I.A.  - Take MASSIVE INDISCRIMINATE ACTION!!!!

    Whatever you are hung up on...just take action to get past that obstacle...and then the next one, and then the next one...and then the next one......

    0Reply
  • Jon Lee
    OP
    Investor · Las Vegas, NV · Member since 2014 · 471 posts · 241 votes
    9y

    @Michael Gellar....Congrats on completing your first deal!  Remember growth happens outside of your comfort zone!

    0Reply
  • Chris Armstrong
    Realtor · Charleston, SC · Member since 2016 · 229 posts · 159 votes
    9y

    Investor for a few years now but 

    Biggest fear was buying into a saturated market and then having rents fall leaving me in a position where  I had negative cash flow each month.  I got over it by looking at the overall economy of my area and what businesses were coming, tourists etc. Then I changed my plan from long term to short term rentals and have not looked back. 

    FLEXIBILITY and MULTIPLE EXITS are KEY! 

    1Reply
  • Luis Angel Lopez
    Miami, FL · Member since 2017 · 25 posts · 1 vote
    9y

    My biggest fear is putting other people's money or my investors money on the line and then a deal going sour... the only thing I can think to overcome this is really do your homework on each deal

    0Reply
  • Brian Haase
    Enola, PA · Member since 2017 · 12 posts · 3 votes
    9y
    My focus is on Buy & Hold.  I don't feel I could dedicate enough time and energy to flips working 50+ hours. 

    Originally posted by @Jon Lee:

    @Brian Haase...don't know if you are focusing on flips or buy & hold but as long as the deal is strustured properly according to you invesitng model..you will be fine.  Best to keep it conservative since it's a secondary income for you.  Best of luck!

    1Reply
  • Michael Caine
    Attorney · Dallas, TX · Member since 2016 · 15 posts · 3 votes
    9y
    Jon Lee My biggest fear is simply losing money. More importantly, losing money by making a stupid mistake. I'm really concerned with flips because it seems one surprise could eat all profits. One thing I've realized is every deal is not going to be a home run, base hits are okay. Im in the process of negotiating my first flip deal and the numbers aren't spectacular (approx 20k profit) but it gets me in the game with real experience and off the sidelines, hopefully giving me confidence for the next deal.
    1Reply
  • April Adams
    Rental Property Investor · Los Angeles, CA · Member since 2009 · 52 posts · 9 votes
    9y
    I'm scared of selling, letting go. I might need it one day. I feel like I'll be a 'hoarder'. A property hoarder. 😏
    0Reply
  • Ian WalshBusiness Member
    Lender · Philadelphia, PA · Member since 2016 · 2k+ posts · 1k+ votes
    9y

    This will sound lame, but my biggest fear really was failure.  I was highly focused to do anything it would take.  Many people I have noticed are stuck with paralysis analysis or lack of focus.  

    1Reply
  • Lana G.
    Escrow Officer · Ewing, NJ · Member since 2017 · 35 posts · 16 votes
    9y
    My goal is to purchase my first multifamily rental. I'm worried I'll get the numbers wrong: what if I pay too much, then get the rehab estimates wrong? I've never hired a contractor before, what if he screws me. Then what if the rental income for the area isn't enough to cover it, even with house hacking? PITI plus repair reserves and utilities etc. What if I don't qualify and this optimism is all for nothing.... I only make around 50k, 750 credit score, planning to use fha 203k to buy a tri- or quad... I feel like other people are making it happen with less, but maybe I'll ruin it somehow. Should I apply as section 8 or rely on a service to vet cash tenants? Honestly, I didn't even have these concerns until this dream became more of a reality for me. I'm trying to make this purchase in <18 months. I know the answer is doing my due diligence and getting confident about the numbers. Work with a realtor and find a mentor. Learn the laws of landlording and just take the leap. I'm soooo excited, but I also know that this is a big move with possibility for error, increased by the number of units.
    0Reply
  • Mike Burke
    Barnegat, NJ · Member since 2017 · 18 posts · 6 votes
    9y

    @Jon Lee I will take your advice. Thank you.

    1Reply
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