I now get why everyone doesn’t invest in RE!

118 Replies

Because it’s hard and taking the first step in the hardest!  We have money ready to go and I always wonder why people who seem to do better than us, don’t invest in RE.  But the emotional roller coaster has almost done me in!  I know I’m not supposed to let feelings come into play, and it’s just numbers, but I’m especially sensitive to it today.  We have put in two offers that have been rejected.  And we had one accepted today, but decided to pass.  Tell me how you overcame the first JUMP, and let me know that it gets easier ;)!

You're exactly right. If it were easy, everyone would be doing it. If you continue to educate yourself and continue to make offers (take action), the right deal will come. I must have made at least 15 offers before my first one got accepted.  

Every successful real estate investor has made sacrifices to get to where they are. You have to be willing to get out of your comfort zone if you want to grow. 

Originally posted by @Michael Craig :

 

Every successful real estate investor has made sacrifices to get to where they are. You have to be willing to get out of your comfort zone if you want to grow. 

Yes, the comfort zone is the hardest part for me. I can't stop thinking of all the things that can go wrong (our goal is to purchase a property that needs some fixing up to Airbnb and then BRRR). What if the market tanks, what if Airbnb is saturated, what if our other rental loses a tenant, what if, what if, what if...those humps are the hardest for me to get over.

 

I think a lot of people have limiting beliefs in general and are afraid to invest. And of those who have the money to invest they believe the stories/stereotype phrases of the awful tenants who trash the place, getting called at 2 AM to unclog a toilet, etc. and because of this have zero interest in investing in RE.

For me, I'm one of those people who HATED working for other people in a 9-5 (I got let go from my job writing sales letters at a media company) but I also realized I needed to make money and not burn through it and so I decided to look into real estate. 

Buy a deal where the numbers make sense. Even if you scour this forum and learn, you'll still learn A LOT by going through the process. 

When you get into something, it always appears amazingly fascinating and sometimes scary, crazy, fast-paced from the outside.  After 2-3 years in the trenches...it's same-old, same-old.  I bought a house last week; offered on one yesterday, getting ready to offer on another tomorrow.  And tonight I'll have a beer and maybe once I will wonder if either of my offers will get accepted.

Once you've made 100 offers, it becomes routine.  But still profitable.   Keep at it.

More offers with an understanding agent. Try to get more deals coming in your inbox through wholesalers and other marketing techniques. Network at the local REA. Don't limit yourself to what's infant of you. More leads = more offers = more closings. Keep pushing and keep it up! Took me a year of offers to find my first property but it was because I didn't have enough leads.

@Frank Geiger where do you find more leads? I find myself limited to the MLS. My realtor is a flipper herself, and she finds all of her deals on the mls as well. I feel like everything has been overpriced (hence the not getting any offers accepted), today's offer that was accepted I feel like I just got cold feet. I was thinking of cooling my jets for a month of two (it was here that I learned November and December were good times to buy).

@Erik W. I can’t wait to get to that point...I can’t even imagine!

@Karl B. I would love to slow down on my day job too.  The trouble is I am too scared to do it until I am generating more income from this...but I need more time to research.  The classic chicken or the egg!!  

It's always a good time to buy but I get your point haha. Sign up for email lists with wholesalers you meet on here or through google (not all their deals will be good but its a start). Add everyone from BP in your area and ask how they are finding deals. Those are three good starting points without investing your own money into lists or cold calling.

@Anita Anand Gaining a big-picture perspective helped me overcome the fear and analysis paralysis when I first got started. My total net worth when I first started was around 40k and I put down 20k on a property (half of my life savings!). But I knew that if I never got started, I would never reach my goals. Start with identifying your goal(s). Early retirement, more time with family, travel, charity work, vacation home? Much of my goals were focused around having enough passive income or "financial freedom" to travel the world and not be pinned down to a W2 job for the rest of my life. 10 years later, I have to say that 20k investment was the best financial choice I ever made. Best of luck to you! 

@Travis Watts that’s where I am.  Analysis paralysis.  I spent the entire night last night crunching numbers and even got an extension on the decision until noon today and I was STILL paralyzed.  At that point without a clear plan I just balked and said no.  Of course now, I am feeling regret.  I keep hearing people say “when you know, you just know it’s a good deal.”  Either I can’t find them or I still don’t know and feel awfully frustrated.  There are so many variables and my mind always goes to the worst case scenario!

Fear is what keeps 99.9% of people from doing something like this. It’s amazing how fearful some of the people I talk to are when we talk about rentals. Just ask yourself this, what is the worst thing that can happen?


Your goal of Airbnb/brrrr is awesome! Worst case scenario.... you go over budget, it doesnt cash flow as much as you think, it takes longer to complete than you think, you can’t refi with the numbers you’re looking for, operating costs are slightly higher than anticipated.... everything in the world could go wrong and more than likely, if you’re numbers are correct, conservative and you stick to them.... you’ll come out a winner.... or at least not too bad a loser. Pull the trigger.

@Anita Anand hi Anita I think all of your problems can be solved with just a shift in the thought process. Rather that looking at it from a “what if these things happen standpoint” I would say to try to look at these situations as a “when they happen” stand point because let’s be honest a lot of unexpected events happen to us all the time and we can control, but sense we know some of these situations will possibly happen, being prepared for them is the best way we can go about handling them. For example your question of “what if our rental loses a tenant” we are prepared for that possibility by working a vacancy expense into our expensive numbers when analyzing properties just as an example hope this helps!

Now would be a great time to decide if you want to take on being a RE investor. Bcuz pretty soon the problems are going to become a lot more stressful, (if u let them). Tenants not paying- tenants destroying ur freshly remodeled property- furnace needs replacedgetting sued- plumbing in a fully occupied 4 plex is backed up snake cant get through, house sits on a slab, and u have to dig up concrete in apartment to replace cast iron while u have 4 families screaming at you. Those are just a small sample size of things that go wrong. So b4 ur money deep into this, now is the best time possible to decide whether your built for this or not. But let me tell you, if you can figure how to handle the the stressors w out getting all excited, being a RE investor can change your life immensely. Bigger pockets is a massive help, and is always there for you when the going gets tuff. It has helped me a ton. I wish you the best of luck on your future endeavors.

7 years ago I made the jump into self employment. For YEARS I grinded away at factories, always dreaming of the day I could stop. 

One day, I told myself there's only one way to see this through and I just gotta dive in. No savings, no Bill's paid in advance, none of that. I put my back against the wall, and dove in headfirst. At the time, my house had burned down, and my family and I were sleeping in the living room at my friends house. It was now or never.

The best motivation I have ever had was riding that bleeding edge of actual starvation and homelessness. You learn to swallow your pride, and get creative in how to make whatever your doing profitable. 

I'm not gonna say I haven't failed, because more than once I had my utilities shut off. Usually because I didn't stay humble and got cocky. But I learned each time I failed. They were hard lessons.

8 months after the jump into self employment, I bought my first foreclosure. 

Make the jump. Be scared. Fail. You will not regret it 10 years from now. The entire time, you will grow both spiritually and financially. Dont forget to smile the entire time, because you are doing something 90% of the population only dreams about.

You got this! 

@Anita Anand Like someone above me on here, I always ask "what's the worst that can happen?" Things will likely go wrong, they won't work out exactly how the books and podcasts will have you believe, but you will learn so much just from that first deal. Fear is what keeps most people from investing in RE. My partner asks me occasionally "what if you lose all your money?" That's just fear speaking. Even in bad deals, the likelihood of losing ALL my money is pretty low. So just ask yourself "what's the worst that can happen?"

Theodore Roosevelt had a few words a lot dating greatly. This is one of my favorite speeches and helped me get started.

"It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, and comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows the great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who know neither victory nor defeat."

Feel the fear .. and do it anyway ! Look, Most people retire broke living off some assistance program in their old age . Don’t let that be you . Real estate is your way to stack the odds in your favor

As a motorcycle rider, we say dress for the crash, not the ride. You don't expect to crash and usually don't. But if you do it is good to have full gear, not flip flops and T shirt, to protect from the asphalt. I assume you like your skin and want to keep it. Be alert and watch what is going on, try to predict what others will do to help stay safe and alive.

Protect yourself as best you can, but jump on and ride, have fun. Hope this analogy helps. Go make money.

@Anita Anand I’m just starting out as well and am in emotional throws of trying to lock down my first purchase. Last week was a roller coaster where I went from missing out on my first purchase only to have the other buyer abruptly walk a few days later. Within 15 minutes of getting that under contract I got notified that a lowball offer I never expected to get accepted, did, and then all of the sudden I went from 0 to 2.

Not gonna lie, the “oh ****” feeling came very quickly after the the initial excitement and I’ve had many internal conversations to “check myself”. I’ve also found that adopting Ray Dalio’s philosophy of asking myself “how do I know I’m right” instead of just thinking “I’m right” forces the issue of giving every angle an honest look if I want any chance at being successful at this.

I wish you the best of luck and hope that one day we’ll each have our own Bigger Pockets podcast interview talking about how we first got started in real estate.

@Anita Anand why did you decide to pass if accepted?

I see lots of people talking about making massive offers routinely. Honestly, I don't like the MLS much and look for off market deals. Most of the time if I get an opportunity, I find a way to make the deal. Its always about solving someones problem and finding solutions to create a win win. I hate massive offers