I am a beginner who is very frustrated in how to do well in investing I'm a beginner who read some books and did some research online. I'm interested in multifamily buildings. I want cash flow with the potential of raise in rent and appreciation of property. However, it is quite frustrating for me to spot out a good investment. I know location is important, but good location usually means huge price and the rental yield is probably low. If the location is not good, the price is low, rental yield is probably "good", but the property may face huge depreciation. Even I have chosen a location, I need to find agents, brokers, sellers to find good deals. Although the numbers maybe look "good", it may not be good only if a thorough due diligence is conducted. However, it costs lots of money. What if the properties are not worthy and I wasted lots of money. It can be lucky to find good property. But what if I find 10 "good-looking" properties, and it may already eat up my savings to do due diligence. So l'm so frustrated and don't know what to do.
It sounds like you are in analysis paralysis. My advice is simple, come up with crystal clear criteria (CCC)for your investment properties. Then screen each property against your criteria; if you have the funds to finance and meets your CCC, then go for it. A poor decision today is still better than no-decision.
You are only buying one place at a time and run the numbers before you look at it. The only money it will cost is if you put an offer in and it is accepted. Then you need to pay for the inspection. ALL houses will have problems, it is knowing what can be fixed easily and what you can use to lower the sales price.
@Fok Ming I completely agree with @Joshua McMillion . You're worrying about problems that haven't even happened yet. I would suggest to continue your practice of analyzing deals. Yes, majority of properties listed on the mls will not be financial sound deals. That being said, there are always creative means you can take to add value to the property and make it a deal.
@Fok Ming We've all been there. Your options are to quit now and go back to school/job and possibly live with the regret of not trying. Or, continue learning, networking and hunting for a deal.
The first deal is the toughest.
@Fok Ming I like to think of investing in multifamily through creating my own value. I like investing in areas that are still a bit sketchy but close to good or growing parts of a city. If you buy lower, the chance of you making a mistake that tanks the deal is much lower. I also find that rents typically vary little between bad and decent parts of town so you may not necessarily be getting much lower rents due to location. I'd suggest you learn the basics, pick a project, and go for it! Definitely don't burn all your cash on your first deal.