So what's holding you back?
Rental Property Investor · East Providence, RI · Member since 2018 · 1k+ posts · 1k+ votes
When I help new investors with buying their first property I often want to know what is holding them back from pulling the trigger.
So I'll ask here. What is holding you back?
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.
No money or experience. I’m doing my best to listen and read anything I can to learn but still need the knowledge and the financial backing to get going on my first property.
I call it the 3 legged stool approach.To be successful at real estate you need to be strong in at least one of 3 things. Money, Experience, or Time.
If you have a lot of time you can partner/work for others as you build up money and experience.
I think the REAL QUESTION here should be... "What's Falling You Forward?"... Finding deals/Marketing for deals that come to you/Prospecting deals , Analyzing Deals(quickly to rule out the thumb and then deep dive mo into da numbers and then if makes sense... Put in da OFFER ...Land da Moneys. And if you think something is holding you back then analyze that... Are you really focused on the GOAL? Once you do that, the obstacles are only in your peripheral vision my friend.
I thing that most people are so responsive to this post because they have a mindset that there is one hurdle that they need to overcome.
"What's falling you forward?" I see your point but think that most people would be confused about what that even means and would keep scrolling.
Hey! Just started on the app and wanted to get some advice. I'm a 20 year old young entrepreneurial college student who loves the idea of real estate investing . My father did it years ago before he had us kids and I really enjoyed hearing his successes . I've done a decent amount of reading/listening/learning about real estate investing and I believe it is time to take action . Whats holding me back personally is that I think I'm too young to qualify for any type of financing. With around $9k sitting in the bank, I want to invest but just don't know if I'd be able to, especially in an expensive NJ market . Let me know if anyone has suggestions for a young guy looking to join the real estate world . Thanks !
If you think you're "too young to qualify for any kind of financing" then you're right and you won't. At least not if you don't do anything about it. I had similar thoughts once too until I actually talked to a lender. Turns out, there are lots of people that would like to lend you money but they likely won't show up at your door. You have to put the work in and seek them out. I would recommend starting with a local credit union or community bank and having a discussion about your goals and your financial situation. Sometimes smaller local institutions are more flexible in what terms they can offer. Another option, (and this is what I did for my property) is to look up a few mortgage brokers to discuss your situation with as they have access to lending programs across multiple financial institutions. Keep in mind, they are sometimes paid commissions from those institutions for connecting them with buyers so you would want to make sure the loan product you decide on really is in your best interest. Let's say you do that and everyone confirms your suspicion that you can't qualify for anything right now--ask why? Find out what you need to do to qualify. If a lender is unwilling/unable to help you understand why you don't qualify then you don't want to work with them anyway. Move on to the next one. There are a lot of different ways to get financing besides the more traditional way I described but for someone new to real estate I think that's probably the best place to start.
My other general advice for getting started is to do stuff. I tend to want to have perfect plan before I start anything but that sometimes prevents you from doing anything. So I would follow some forums on BP, listen to the podcast, read books but then go do something too, such as: talk to lenders, look up and attend local real estate meet ups to make connections(I'm going to my first one tonight and I'm pumped about it!), learn how to analyze deals even if you can't afford them--practice it anyway. Lastly, it sounds like your dad has worked/does work in real estate. There is a huge free resource right there that you could tap into. Don't overlook that. Best of luck to you.
I agree with David. Like I said, I know 17 year olds doing deals through partners. Jake, you can make it happen.
I am new to this forum and I am looking to grow my net worth and cash flow for the future. I make great income with my real estate team in Houston, high credit score and having trouble deciding where to start. I would like to keep my initial personal cash costs below $50-60k on the first opportunity. I recently closed on a minor repairs flip that was a pre-foreclosure. (I wish I would have kept it and refinanced out to keep as a rental - BRRRR) Find an under market property to rehab in a suburban area with good schools or to an area closer in town where it is re-gentrifying and looks like property values increasing rapidly? The potential tenants in the suburbs might be easier to deal with. Any thought or ideas welcome.
You have already started a great business. You probably have plenty of connections already. Based on what you have told me I would continue to do a few flips to generate a chunk of cash. The other option is to is to partner with someone willing to invest more money and do some bigger deals.
You are doing great.
@Frank Patalano
I just made my first offer on an investment property in GA near my town. It was a great experience even though I didn’t get the deal. Having my realtor educate me about the 1% rule, comparing comps, and not paying “retail” even though the house was still at a good return was all helpful to my education.
Now, I just need to find another property in my cash budget.
Sounds awesome. You also have a keep of an agent. Take can of him/her. They are worth their weight in gold. At the same point look for off market deals as well. Since the property is not publicly for sale you should get a much better deal. You can still pay your agent to help you on the first property if you want.
@Frank Patalano
I live in So. CA. Have 1 rental here now, and looking to buy another. Have a decent amount saved, which puts me in the $200k under range to do 20% down on a conventional. I’m finding some decent deals in Texas on SFRs, that will cash flow $300-$500 monthly but my fear is the distance.
Wondering what the biggest challenge is during escrow and there after. Property management?
Guess I should just leap but not sure....
@Frank Patalano
Hi frank,
Im happy to say I’m close. I have most of my team in place and funding but every time I go look at a place an offer is already pending. A day late every time. Just connected with a few wholesalers in my area hopefully that helps. I’m in the Seattle market and it’s hot right now.
@Frank Patalano
Cash to get started and lack of knowledge.
I've always been into personal finance and I just accomplished getting my emergency fund fully funded (after 2 years of maxing 401k and Roth IRA contributions so kind of backwards).
I keep telling myself I'm in the learning phase because I've only been interested in real estate for the past 3 months or so.
I've read 4 books, listened to 40 bigger pockets podcasts and watched about 1000 hours of YouTube videos about real estate. I plan to shift to reading alot more and actually taking notes on what I'm learning, while saving $1700/mo for the next 18 months before taking a dive.
I really hope I don't get stuck in an analysis paralysis phase, but I'm hopeful that since I have a plan laid out (what I'm going to read/study, events I'm going to attend, people I plan to speak to), and a dollar amount that I think is good to start with, that 18 months from now I'll be posting about my first deal.
@Vinay H.
I’m just getting start up near the Newburyport area and am finding cash flowing deals in the nearby areas. My goal is to wholesale, hold rentals and property manage for myself and others. Let me know what your looking for and I’ll add you to a specific buyer list.
@Frank Patalano
I live in So. CA. Have 1 rental here now, and looking to buy another. Have a decent amount saved, which puts me in the $200k under range to do 20% down on a conventional. I’m finding some decent deals in Texas on SFRs, that will cash flow $300-$500 monthly but my fear is the distance.
Wondering what the biggest challenge is during escrow and there after. Property management?
Guess I should just leap but not sure....
If you can find a great property manager you will be all set. You can usually get the PM referrals through here. But I would also double check with my agent. Perhaps you should take a weekend out there and meet some of the property managers.
@Frank Patalano
Hi frank,
Im happy to say I’m close. I have most of my team in place and funding but every time I go look at a place an offer is already pending. A day late every time. Just connected with a few wholesalers in my area hopefully that helps. I’m in the Seattle market and it’s hot right now.
A wholesaler will be your best bet. There is no problem with just throwing it out there on Facebook to your friends and family what you are looking for. I still have people to tell me oh yeah I forgot. I forgot you were looking to buy property. Other people are like. Why didn't you tell me that you were interested in buying property? Sometimes you will bang your head against the wall. Other times you will find deals.
@Frank Patalano
Cash to get started and lack of knowledge.
I've always been into personal finance and I just accomplished getting my emergency fund fully funded (after 2 years of maxing 401k and Roth IRA contributions so kind of backwards).
I keep telling myself I'm in the learning phase because I've only been interested in real estate for the past 3 months or so.
I've read 4 books, listened to 40 bigger pockets podcasts and watched about 1000 hours of YouTube videos about real estate. I plan to shift to reading alot more and actually taking notes on what I'm learning, while saving $1700/mo for the next 18 months before taking a dive.
I really hope I don't get stuck in an analysis paralysis phase, but I'm hopeful that since I have a plan laid out (what I'm going to read/study, events I'm going to attend, people I plan to speak to), and a dollar amount that I think is good to start with, that 18 months from now I'll be posting about my first deal.
Sounds awesome. You're doing great. Stay motivated, and keep to those goals. If you want send me an update once in awhile.
@Frank Patalano
I’ve been looking at properties for over a year, but struggling to pull the capital together to put the 20% down payment down. Are there good deals for under 30 grand? 6-9 grand is a feasible number for me to save up. Anything over ten is shooting for the moon. I’m very anxious to get the ball rolling, but worried that I’m too far off.
@Mark Bommarito
I have two properties in Birmingham AL area. Have just fired my old property manager, and hired another. He told me he had some leads on some properties.
@Frank Patalano
I’ve been looking at properties for over a year, but struggling to pull the capital together to put the 20% down payment down. Are there good deals for under 30 grand? 6-9 grand is a feasible number for me to save up. Anything over ten is shooting for the moon. I’m very anxious to get the ball rolling, but worried that I’m too far off.
So you are in Pittsburgh. There are plenty of houses in the Ohio markets for under 50K. Look there. Also consider a partner.
@Frank Patalano
Money.
The beauty of real estate is that money is not as much of a requirement. You can use leverage.
You can use other people's money.
You can partner.
You can wholesale.
You can get referrals.
You can get seller financing
I know people that have bought a house with CC money.
@Frank Patalano
Hi Frank!
As someone who is looking to buy their first property, I would say not knowing whether or not the deal
I’m looking at is truly a ‘deal’ or not! Knowing the market is my biggest weakness. I also live in the city without a car, and it is hard to visit properties due to this fact.
Its a mind thing for me and possibly for many others too. Many folks have 9-5 day jobs and they get paid well enough with benefits (me included) which means all we have to do is save as much as possible and stick to the road well traveled . Since there is no urgent crippling need to take massive action+mind shift,there are delays in starting, fear etc. Imagine if you had nothing else you can do other than R.E.I, where is the question of fear ,doubt etc?
I know for sure that there are things truly to possibly fear and are riskier than real estate investing , for example driving every day to work in Tampa ..its like a death race every day to work. Compare that to R.E.I where for every step you take you got multiple folks to reach out to to get confirmation on if you are on the right track. There are possibly folks in BP who if you reach out to and maybe pay them an agreed reasonable amount,they will remotely guide you/look over your shoulder thru every step of your first flip or rental etc . To truly succeed in R.E.I or anything investing or business related, that safety net that comes from work has to be burned in your mind , and that does not necessarily mean quitting your job....since its in the mind ,its not easy to do,but needs to be done to succeed or often even get started.
@Frank Patalano
Hi Frank, I think what's holding me back is the apparent 'hot' market competition for good deals, in my area. Many properties just don't cashflow when running the numbers and I'm competing with cash buyers who can snatch the deals way faster. Additionally, I work a ton and don't have the time hunt for deals all day like these wholesalers do. Don't I wish it was 2011 again!
For the BRRRR method, no one talks about the "seasoning period" that comes with an investment property and how you have to wait 6 months before being able to refinance an investment property and get the cash out of the appraised value. If you don't wait, you can only get the cash out of the purchase price plus renovation costs. Thats a big hiccup that is hidden when explaining this whole deal!
Looking to purchase my first rental property! Feel like I am in the "Paralysis by Analysis" stage. Can not decided between SFH or Duplex. I like the cash flow of duplex but I am currently finishing school (21 years old) and only have so much money for a downpayment! Starting my first full time teaching job in January so will have more income to invest later on!
I love helping teachers. What percentage do you plan on putting down on the single? What is that as a dollar amount?
@Frank Patalano I hope to put down about 20%. I am actually thinking of partnering with my brother who has full time job already. Between the two of us we can afford about 35-40K downpayment. Just not sure what the best course of action is with our available funds. Should we maybe look at higher cash flowing duplex? Or two smaller SFH that we could sell in a few years to turn into more properties.
@Frank Patalano
Hi Frank!
As someone who is looking to buy their first property, I would say not knowing whether or not the deal
I’m looking at is truly a ‘deal’ or not! Knowing the market is my biggest weakness. I also live in the city without a car, and it is hard to visit properties due to this fact.
Brooklyn was a tough market to make money. Be careful about some new laws just passed in the last month at the state house. Many bigger investors are taking about it.
You have to keep analyzing and running numbers until you are comfortable that a property can make money.
You don't have a car but you have quite a public transit system.
Its a mind thing for me and possibly for many others too. Many folks have 9-5 day jobs and they get paid well enough with benefits (me included) which means all we have to do is save as much as possible and stick to the road well traveled . Since there is no urgent crippling need to take massive action+mind shift,there are delays in starting, fear etc. Imagine if you had nothing else you can do other than R.E.I, where is the question of fear ,doubt etc?
I know for sure that there are things truly to possibly fear and are riskier than real estate investing , for example driving every day to work in Tampa ..its like a death race every day to work. Compare that to R.E.I where for every step you take you got multiple folks to reach out to to get confirmation on if you are on the right track. There are possibly folks in BP who if you reach out to and maybe pay them an agreed reasonable amount,they will remotely guide you/look over your shoulder thru every step of your first flip or rental etc . To truly succeed in R.E.I or anything investing or business related, that safety net that comes from work has to be burned in your mind , and that does not necessarily mean quitting your job....since its in the mind ,its not easy to do,but needs to be done to succeed or often even get started.
I agree that it is a mindset thing.
I was working a decent job when I first started. Instead of blowing all of money or keeping it in the bank, I needed a place to invest. I started with real estate and stocks.
@Frank Patalano
Hi Frank, I think what's holding me back is the apparent 'hot' market competition for good deals, in my area. Many properties just don't cashflow when running the numbers and I'm competing with cash buyers who can snatch the deals way faster. Additionally, I work a ton and don't have the time hunt for deals all day like these wholesalers do. Don't I wish it was 2011 again!
We all wish it was 2011. I'm not sure what type of investing you are doing. I buy most of my buy and holds from wholesalers.
Are you doing your own marketing?