Providence, RI · Member since 2018 · 29 posts · 409 votes
7y
Having just recently bought my first property, I know for myself what was holding me back was the fear that I would overpay, especially in this type of a market. I would get analysis paralysis and basically talk myself out of every property I looked at.
What's holding me back is my lack of experience and funds- I'm in my last year of college and I've been reading about investing but I have to save up first!
If you can put in the time you can compensate for not having funds. Plus you can learn on the way.
Could you elaborate? I'm definitely trying to learn but I don't have the means right now to take out a loan on a property. I'm trying to build my credit score and secure a full time job after college so I can start investing.
You can invest non-capital gains in an opportunity fund, but you don't get any of the tax benefits. In your situation, an Opportunity Zone investment wouldn't make sense.
That said, if you decide to flip your first property and have a significant gain, that could be the right time to start an OZ fund to get the tax deferral on your flip gains so you can move the full pre-tax gain into your next investment.
What's holding me back is my lack of experience and funds- I'm in my last year of college and I've been reading about investing but I have to save up first!
If you can put in the time you can compensate for not having funds. Plus you can learn on the way.
Could you elaborate? I'm definitely trying to learn but I don't have the means right now to take out a loan on a property. I'm trying to build my credit score and secure a full time job after college so I can start investing.
Sure. You find a partner that has money. You put in all the work. You find the deal, run the numbers, and put it under contract. Your partner funds the deal with cash and decent credit
Rental Property Investor · Houston, TX · Member since 2014 · 10 posts · 13 votes
7y
@Frank Patalano
Hi Frank,
What held me back is not knowing where to get capital from to finance a deal and who to trust. Frank I’m just getting started and decided that I’m all in, and will learn along the way.
What held me back is not knowing where to get capital from to finance a deal and who to trust. Frank I’m just getting started and decided that I’m all in, and will learn along the way.
Consider a partner. You put in the time and they put in the money.
Real Estate Agent · Tulsa, OK · Member since 2019 · 3 posts · 0 votes
7y
@Frank Patalano
The thing holding me back is not having enough capital to make a big enough down payment on a loan to get my first property. I recently just graduated from college in May and am eager to start investing but I’m still trying to find a way to get it financed with my low income. I started working as a real estate agent 2 weeks after I graduated and am about to close on my first sale but it still won’t be enough to get me started. Also the fear of not knowing/ having enough experience is always in the back of my mind.
The thing holding me back is not having enough capital to make a big enough down payment on a loan to get my first property. I recently just graduated from college in May and am eager to start investing but I’m still trying to find a way to get it financed with my low income. I started working as a real estate agent 2 weeks after I graduated and am about to close on my first sale but it still won’t be enough to get me started. Also the fear of not knowing/ having enough experience is always in the back of my mind.
Media, PA · Member since 2018 · 54 posts · 25 votes
7y
@Frank Patalano. I bought my first property when I was 25 (in 07 before the crash). I overplayed, Didn’t have any experience, then the crash hit. The tenant eventually passed away and her grandson moved in and destroyed the house, was late and short on rent and then eventually skipped on me. I later found out he was in jail for drugs. I was paying out of pocket for nearly a year and racking up credit card debt, making repairs just to try to get it rent ready again to pass inspection.
I owed $87k and the house was appraised at $33k. I had no way out so I had to let it go to foreclosure.
I’m now 36 with a wife and child, and my credit is still being mended, and I still have the foreclosure on my record. So, the credit, and the cash to Invest is really me back, but the desire that I’ve had to be in Real Estate is still there.
@Frank Patalano. I bought my first property when I was 25 (in 07 before the crash). I overplayed, Didn’t have any experience, then the crash hit. The tenant eventually passed away and her grandson moved in and destroyed the house, was late and short on rent and then eventually skipped on me. I later found out he was in jail for drugs. I was paying out of pocket for nearly a year and racking up credit card debt, making repairs just to try to get it rent ready again to pass inspection.
I owed $87k and the house was appraised at $33k. I had no way out so I had to let it go to foreclosure.
I’m now 36 with a wife and child, and my credit is still being mended, and I still have the foreclosure on my record. So, the credit, and the cash to Invest is really me back, but the desire that I’ve had to be in Real Estate is still there.
I'm sorry to hear that you had such troubles in your first deal. I lost money on my first real estate investment as well. The difference is that I stayed in it for the experience and punishment.
That is one of the big problems that I have with single family rentals. Relying too much on one tenant.
You could try wholesaling a few deals to start. Or you can try to find a property with seller financing.
Credit + funding. Funding comes in Jan 2020. I'm working on improving credit before then as well.
Sounds like you have a plan. Educate and network as much as you can before then. If you don't want to wait, find a partner who has the cash and credit.
Somerville, MA · Member since 2016 · 1 post · 0 votes
7y
@Frank Patalano. I am not that risk averse because I bought a place with a friend years ago in Brighton when we had pretty much nothing and made a nice little profit that I put into my current place in somerville. I want to take that equity and make it work somewhere else - thinking newport or savannah. What’s holding me back? I’m trying to time the rental market for students - I think I missed the window they will rent
I've been involved in REI for about a month now. What's holding me back is I haven't decide what type of investment I want to focus on. Fix&flip, wholesale, buy&hold, etc. I read a couple of books, listen to podcast, YouTube video but so much information overwhelm me, I some time I just feel like taking a metal break. I feel I go no where.
Los Angeles, CA · Member since 2018 · 16 posts · 4 votes
7y
@Frank Patalano what was holding you back? Investor for 15 years, bought your first property in 2009. So you owned for 10 yrs, invested for 5? Must have had a fat wallet to buy 65 properties and 300+ syndications in 10 years
You need to be comfortable with rehab if you want to get into houseflipping and BRRRR. It can be very stressful dealing with contractors, budgets, and the dreaded unexpected. I found that out the hard way from only one rental and it lead to near sleepless nights. Unless you're doing it yourself, which is another matter altogether.
Your current lifestyle and obligations might help dictate which path you choose. Your expectations will as well. The higher the risk, the higher the reward. If you want to start smaller then there are more passive ways to invest.
I am 100% ok with starting small and passive. I'd love to try and find someone that I can partner up with on a few house flips so that I can get my feet wet, build up some equity and get something going somehow before diving in all alone.
I just need a lot more time to understand the process and get my educational foundation created. I've only started binging this stuff for about a week now. I'm hooked, I don't have much money, so I'm just really focused on saving as much as I can as soon as I can so that once I've gotten comfortable understanding the basics, I can spend the weeks to develop my plan before I actually get going.
I'm a big learn and plan first guy, so it's really all about getting all of that down before I actually start approaching CPA's, lenders, lawyers, realtors, etc.
You are early in the process so keep going.
Set goals to do so much reading a day. Try to listen to at least one podcast a day. Try to go to one networking event a week.
I wouldn't worry about a CPA yet. Get yourself 3 people first. A lawyer, a contractor, and an agent.
Go out there and look at so many properties a week.
Sounds good--Before I do that, I still need to determine my plan---including choosing whether I'm going to go with straight real estate investing, wholesaling, houseflipping, and/or BRRRR. I really need to study the pros and cons of these and how they fit into my goal(s). Any advice on that?
What are your goals?
Well, that's a loaded question. At an 80,000 foot level, I want to get to $50k/month; My ideal timeframe is to reach this goal by the end of 2025. I'd like to begin passively, with REI being a side hustle until I'm able to reach $25k/month before quitting my job and going into REI full-time for another 15 years and be done by 55.
I'd also post in the BP sub-forum for the area you live in. Chances are favorable there are experienced folks out there willing to bring on a partner for a fix-and-flip project. You have to get to know folks first.
Finding an investor/realtor hybrid in your area to talk to might also be advantageous to your networking.
Rental Property Investor · Middletown, NY · Member since 2019 · 8 posts · 1 vote
7y
Whats holding me back is fear and money..
Im looking at putting in a bid on my first property. A 2 family 3bedroom 2bath side by side duplex in foreclosure. I want to make it a owner occupied rental. Not necessarily a cash flow but rent/mortgage free allowing me to save up and purchase my 2nd property. I look at opportunities 2-4hrs daily.
My fear is upon purchasing the multi family.... the rehab process and time, Trying to pay my rent in the meantime until the duplex is Livable.
Getting it rented out as soon as it ready I don’t have any fears. Prime locations great school low crime popular location. Just the fear of the rehab process with a 203k (fha) and finding a stable,qualified contractor for a full home rehab .
I also have a lot of ideas since it’ll be my home on one side.
New hard wood floors, central ac. Updated electrical, new bathroom, new roof, siding. Front and rear porches. I’m honestly terrified I’d go over budget and not get what I want or would want in a quality rehab.
(The reason I want to update all new because the before the rehab process is even start if I can get it for the foreclosure amount the property has over 80k in equity and the revaluation after the rehab I can only imagine will sky rocket)
But my ideas and dreams can crash and I’d be stuck.
Holding me back ummm? Fear and money of course just like the rest :) I do feel that the more that i get educated the more the fear will be replaced with excitement to invest. I am truly a newbie just started to research properties and learning the ins and outs. I have narrowed down what I would like to do its just finding the financing and the right deal. I live in Denver and love my area but the prices are high just haven't found the deal yet but I will keep looking. In the meantime more research and saving money.
@Frank Patalano. I am not that risk averse because I bought a place with a friend years ago in Brighton when we had pretty much nothing and made a nice little profit that I put into my current place in somerville. I want to take that equity and make it work somewhere else - thinking newport or savannah. What’s holding me back? I’m trying to time the rental market for students - I think I missed the window they will rent
You definitely missed the window for this year. You pretty much missed the window for the spring semester. If you are looking now I would consider doing Airbnb until next August but start marketing it in by January for August 2020.