Feeling overwhelmed with Real Estate?
Are you feeling overwhelmed with your Real Estate start? It makes sense, there's a ton of information to sort through and horror stories from 10 years ago of people going bankrupt. The amount of acronyms in real estate can make people run for the hills. And the number of properties on the market on any given day would be impossible to search through (if you don't have specific criteria).
But don't let that deter you from making moves towards your end goal! There's a lot of "free" activities that will help you in the long run. Reading real estate and business books from your local library, listening to BiggerPockets podcasts, and searching the MLS are all activities that do not require any financial obligation. They do require time, but you can "create" time by listening to podcasts while driving to work, reading books during lunch, and searching the MLS instead of Facebook. Eventually, the lessons learned will become so ingrained in your mind that you're no longer going to be overwhelmed.
I'm not kidding! After reading, listening, searching for 100 hours, it will start to feel completely normal to invest in real estate. Yes, you worked hard for the down payment. But you also worked hard learning real estate valuations and learning about great deals. Once you find a great deal, you'll know it and everything will come together nicely. Just take a deep breath and trust the process.
For myself, my wife and I got into real estate investing through House Hacking. Essentially, we purchased a home knowing we were short of the 20% threshold so we would have to pay a PMI. We just couldn't stand the idea of renting from someone else anymore. However, I really, really hated paying $300 a month in PMI for absolutely nothing. So, we searched for a private loan to put towards the down payment and bring our LTV up to 80%. Bought a new appraisal, and all of a sudden we were PMI free and had an extra $300/month in our pocket every month.
But how did we pay for the separate loan? Well, there was an extra room in our house, so we rented it out and used the money earned towards the loan. The loan essentially cost us nothing (except for dealing with a roommate), and we had an extra $300 in our pocket every month. From then on, our eyes were opened to the wonderful world of real estate. Since then, we bought another house and have been renting out the original house ever since. In 15 days, we will close on our 2nd rental property. We plan to max out our conventional financing options within the next 2-3 years as we continue to build the retirement portfolio.
Lesson learned - Spend your time learning as much as possible, then take action!