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.
I currently have a single family home that is 90% complete. What's holding me back is, I don't know if I'm ready for the responsibility of a tenant. I spent all my money on the rehab, and one phone call from a tenant about something not working properly or is broken, and I'm a bad landlord. I don't have access to capital to fix a furnace or replace a water heater, etc. I'm not really sure how to properly screen tenants either. Any advice would be appreciated
Thanks
David
You are so worried that perhaps you should just sell the property. I don't know what you bought it for and I don't know what you can rent it for but if you're that concerned you could always have it professionally property managed. It sounds like that might cost you too much money.
Yes things are going to break once in awhile. You have to save all of your rental income to build up an emergency fund.
For me I have a one-page application and we check credit and criminal record. There are websites that can do this and it does not cost you anything as the tenant will pay it. Call the previous two landlords. Make sure they are generating enough income to support the rent. Two-and-a-half to three times the rent should be sufficient.
I would be happy with chucks of money, doesn’t necessarily have to be steam of income. I don’t own a home though
Sounds like you can go either way then. Why Don't You Fix and Flip a couple. If you don't like it or get tired of it buy a multi and house hack it. Eventually you'll be able to do both the same time.
Hello, I’ve wanted to get involved in investing for some time (flipping and possibly rentals), but have some debt and driving a truck. Looking on settling in Florida and wondering what kind of “entry level” real estate market arena I can get involved in in order to learn some things about the industry while making some money. A bank? Title company? Agent? I also have an MBA if that helps. Anyone have any suggestions? Thanks!
Any of those would work. I would also consider being a mortgage broker, or property manager as well.
You can own property and drive a truck at the same time. I don't perform any work on my properties. I pay someone to handle it.
I've been renting for more than 34 years and I KNOW I need to get out of this situation!
I would say my greatest fear is making a mistake and having a deal fail miserably, i.e. a Fear of failure. This has caused me to get stuck in the 'paralysis of analysis' in the past- a lot of activity with no action.
Right now I'm just trying to learn good ways to generate leads to be able to research.
Thanks.
Gordon, I assume that you rode a bicycle when you were a kid. When you first started you probably fell off that bicycle a couple of times. Did you never get on a bike again ? Failing once in awhile is okay that is how we learn. I think you need to join a public speaking class. That is one way to get over fear.
I lost money on my first property. Good thing I didn't give up then.
Lender · Anoka, MN · Member since 2019 · 30 posts · 6 votes
7y
Thanks Frank, I appreciate that. It's good to know that even though money was lost on your 1st property failure the 1st time around should be a learning curve, not an excuse to quit.
I actually had pretty good balance when I first started riding a bicycle so I never fell over but that's beside the point. ;) Drove into a swamp yes, but never fell over, lol.
The math is what is holding me back. I question my numbers. Im not sure if I have everything accounted for when trying to calculate all month expenses. That leaves me with the question of can I really afford this property.
On my first property I utilized a handful of calculators from BP, watched YouTube videos, and read as many articles as I could. While it still wasn't perfect, using a diverse array of spreadsheets and instruction gave me some confidence as to knowing if my analysis was in the ballpark. After that, you gotta take the plunge at some point!
Thanks Frank, I appreciate that. It's good to know that even though money was lost on your 1st property failure the 1st time around should be a learning curve, not an excuse to quit.
I actually had pretty good balance when I first started riding a bicycle so I never fell over but that's beside the point. ;) Drove into a swamp yes, but never fell over, lol.
I still make mistakes once in a while. My philosophy is if you don't fail once in awhile then you're not challenging yourself hard enough.
Rental Property Investor · Hemet, CA · Member since 2019 · 25 posts · 8 votes
7y
@Frank Patalano it looks like they’re ranging between the $350k - $500k Mark. Rents are anywhere from $800 to $1200. The big issue I’m having is that the Hemet area is rough. It’s “good” properties are scattered throughout rough neighborhoods and the good neighborhoods aren’t selling any deals. I’m staying patient though.
I'm not a new investor, but I am trying to step up from duplexes to 4-8 plexes. What is holding me back is other "investors" overpaying. I've been outbid a few times, and I can't figure out how the winning bid is making any money! I'm guessing they have deeper pockets than me and are counting on improvements, appreciation, and much higher rents in the future, so they can take a loss in the short term.
I am seeing the same thing. I saw two weeks ago a couple properties go for 80% of ARV at the auction. How does someone make money on this flip after closing costs and rehab costs?! I wanted to actually ask them what their rationale was. But figured they’d wouldn’t want to share that info.
@Frank Patalano it looks like they’re ranging between the $350k - $500k Mark. Rents are anywhere from $800 to $1200. The big issue I’m having is that the Hemet area is rough. It’s “good” properties are scattered throughout rough neighborhoods and the good neighborhoods aren’t selling any deals. I’m staying patient though.
Yeah hold out. Don't buy good properties in rough areas unless you think that the entire neighborhood can gentrify through a downturn. Keep focusing on those good neighborhoods. Walk the streets. Look for distressed properties on those good streets. You may have to try to go after off-market opportunities in those good neighborhoods
I'm not a new investor, but I am trying to step up from duplexes to 4-8 plexes. What is holding me back is other "investors" overpaying. I've been outbid a few times, and I can't figure out how the winning bid is making any money! I'm guessing they have deeper pockets than me and are counting on improvements, appreciation, and much higher rents in the future, so they can take a loss in the short term.
I am seeing the same thing. I saw two weeks ago a couple properties go for 80% of ARV at the auction. How does someone make money on this flip after closing costs and rehab costs?! I wanted to actually ask them what their rationale was. But figured they’d wouldn’t want to share that info.
Yeah I can be scary especially when you're buying foreclosures without seeing the inside of them.
Rental Property Investor · Hemet, CA · Member since 2019 · 25 posts · 8 votes
7y
@Frank Patalano yeah, that’s my best bet. I want to start looking into how to get on this Direct Mail marketing tool and trying my hand at those better neighborhoods. I appreciate the advice man!
Seattle, WA · Member since 2019 · 1 post · 0 votes
7y
Currently renting an apartment that has a lease into next year. Until then, I plan on learning and acquiring the knowledge needed to hopefully by a duplex/triplex once my current lease is done. Also reading about ways to see if im able to jump into the investing game while still renting if it doesn't put me back financially.
Currently renting an apartment that has a lease into next year. Until then, I plan on learning and acquiring the knowledge needed to hopefully by a duplex/triplex once my current lease is done. Also reading about ways to see if im able to jump into the investing game while still renting if it doesn't put me back financially.
You should be Educating and Networking.
You could try Wholesaling. Little money but lower percentage of success when starting out.
For me it's a fear of not really knowing what I am doing and a lack of capital. When I passed my state EMT (Emergency Medical Technician) exam, a paramedic instructor I had took me under his wing and taught me everything I needed to know to be a great EMT. I have reached out to a couple of friends I have that are already RE investors, but none seem to eager to take someone "under their wing." I have been searching for properties that I think have potential but no one to lean on and say "hey, what do you think about this?"
For me it's a fear of not really knowing what I am doing and a lack of capital. When I passed my state EMT (Emergency Medical Technician) exam, a paramedic instructor I had took me under his wing and taught me everything I needed to know to be a great EMT. I have reached out to a couple of friends I have that are already RE investors, but none seem to eager to take someone "under their wing." I have been searching for properties that I think have potential but no one to lean on and say "hey, what do you think about this?"
Perhaps if you can bring them value others might be more willing to help you. Find out how you can help them in their re adventure. Perhaps they need someone to drive by properties or stuff envelopes.
Start going to your local REIA as well. You might find like minded people only one step ahead of you willing to share knowledge.
How do I establish more leads? Besides marketing though networking, banners, business cards, Craigslist, website? I want callers to reach out to me besides just me finding them though driving for dollars and foreclosure list.
I currently live overseas and I am just starting to learn about REI. What is holding me back now is the fact that I am overseas but I am moving to NC in a few months. My goal is to have a property within 90 days of being back.
@Frank Patalano I’ve just started with bigger pockets. I have two rentals that I manage that are rent to owns where my grandfather holds the note.
I’ve been self employed (cleaning company) and have tried to put all my pennies into growing the business and not focusing on paying myself first - averaging $25-35k/yr.
This year I’m ditching the employees, working my butt off and paying myself as much as possible ($12-15k/mo) saving almost all of it for my “first bank mortgaged” property.
The problem is since I’m self employed they are going to want to see my last two years of returns where I made very little. I’m working on getting pre-approved, but may have to save cash for my first $40-75k deal this year or just wait a year before I can prove I have the money and get financing
Contractor · Matthews, NC · Member since 2017 · 15 posts · 1 vote
7y
Willingness to spend. Right now we are working on building a cash reserve and maxing out retirement contributions since it will have a longer time to grow now as opposed to contributing later in life.
Aside from the retirement fund goals, we are making some home improvements, including adding an in-law suite with a private entrance that we rent our either long term or airBnB.
We want to start our real estate journey from a position of financial strength.
How do I establish more leads? Besides marketing though networking, banners, business cards, Craigslist, website? I want callers to reach out to me besides just me finding them though driving for dollars and foreclosure list.
If you done everything that you have said then that is a lot. How about mailers, doorknockers, and facebook ads?
If you are not getting enough leads with everything that you are doing, you might need to look at the materials themselves. Figure out why they are not being effective.
I currently live overseas and I am just starting to learn about REI. What is holding me back now is the fact that I am overseas but I am moving to NC in a few months. My goal is to have a property within 90 days of being back.
That's a fine goal. You can still keep educating and making contacts now. You might be able to get preapproved now and have an agent already looking for you.