Panic attacks are impacting my deals
Kingston, NY · Member since 2017 · 252 posts · 138 votes
I know the feeling of being nervous going into a flip. It sounds like you and I are both doctors--so I know my biggest problem in rehab deals is that construction is not my area of specialty. I solved that by having a contractor who I trust--and that just happened by accident, but it sounds like you may have one too.
A little mental game I play with myself to put risks in perspective, is I ask how many shifts I would have to pick up to cover a worst case loss. In reality it isn't all that many, and depending upon your specialty that's probably the case with you, too. No, I don't relish the idea of picking up extra shifts to make up for a catastrophic loss on a real estate deal, but how catastrophic can one deal really be? I paid way more for medical school than I would stand to pay in the school of hard knocks on a single real estate flip. And you can make more money in real estate than you can in medicine.
@James Canoy every deal will build your confidence, so the key is getting through the first one. First of all, I can assure you that the challenges of being homeless, army and medical school are way more stressful than flipping a home.
Consider the worst that can happen and accept that. The worst situation in a flip is losing money. Many people lose money on their first flip and just consider it the cost of being educated in flipping.
Another possibility to consider is that you are not ready to enter the flipping business. There is no shame in deciding to wait a year or two, until you have more cash reserves built up. Maybe a better plan is focusing on your career, which has high income potential. Sometimes fear and panic is our body telling us to step back from danger.
Realistically being nervous and having a panic attack resulting in pulling out of a deal are two entirely different things. Definatly not within the normal range of investor anxiety.
Panic attacks are a serious medical condition that should be addressed. Resolve that issue first medically then deal with moving forward with investing.
What you are experiencing is not normal regardless of what others may think. It is a disability that should be and can be easily addressed with medication. Make your life easier and your investing will benefit.
I 100% agree with @ @Joe Splitrock! You're nervous because you have no confidence, and the unknowns are high, and yes, it's scary at first. After a few, it because exciting-- because you know the unknowns, costs, and estimate rehabs more accurately.
The sooner you accept that things will go wrong-- maybe list out the cost of replacing a roof, plumbing, HVAC, etc... and understand your worst case scenario, and have an honest talk with yourself-- can you handle it emotionally and financially? I guarantee, stuff happens, things go wrong.. you need to learn the beauty of "rolling with the punches" because it happens! Last year, the contractors (I'm 99% sure) stole our our copper pipes, all the sudden a $4K expense came because we had to replace all the plumbing.. it happens, you roll with it and move forward.
@James Canoy I can remember the first game I pitched in college. I wanted to throw-up right before I took the mound. Needless to say I didn't have the best first outing... I realized if I wanted to keep my scholarship I had to get it under control. I had been on the mound a thousand times before but it came down to the fact that I was really just afraid of failure. Our pitching coach pointed out that even all-stars lose fairly regularly and to use the fear of failure to fuel my preparation/training habits. As I bought in my game prep habits got much more focused than ever. The better prepared I was, the less performance anxiety I had, the better I pitched.
So, first of all realize that you are going to make some mistakes. We have all made mistakes and we will all continue to makes mistakes here and there. Show me someone who says they have never made a mistake in real estate and I will show you a liar. The key is to minimize the damage from mistakes. Preparation and education is the key. Read everything you can. Listen to podcasts. Find mentors.
You mentioned medical school. I assume you are a physician. In my book I wrote about Physicians White Coat Syndrome, a condition I recognized, that affects Physician's investment decisions. Contact me and I will send you a complimentary digital copy of my book or snag it on Amazon.
You may also want to consider initially partnering in a multifamily deal with a syndicator. Syndicators have the experience you currently lack and if you work with the right one, they will let you shadow them as they walk thru the entire process from market and submarket evaluation, Shopping comps, Underwrite, LOI, PSA, Due Diligence, Financing, Final walk thru, Closing, and Operations.
Also as a physician you may enjoy the passive nature of working with a syndicator. Does your schedule allow time for 1 am leaking toilet calls? What about the water heater that blows or the garbage disposal that jams. there are lots of ways to make money in real estate....decide the lifestyle you want before jumping in to the deep end.
Read "Who Moved My Cheese". It's a short, light read, but filled with good advice.
Change can be daunting to alot of people. Others thrive on change. So, when I read some of the responses on this thread, I see the way some thrivers don't get how change could be scary.
Make a list of pros and cons of your decision to go into RE investing. Is it for you? Why? Make the argument on paper that you can refer to later.
Have an experienced investor evaluate your deal. There are surely plenty of them on BP with no shortage of opinions who can tear through any deal and let you know where the holes are.
Be confident in your decision after following the first two steps. When fear creaps in, refer back to your written notes to yourself about why this was the choice you made.
I disagree that you should put more Earnest money down on deals. That only increases your liability and risk of losing it if an issue arises. Although, I am sure that the suggestion was made in jest (I hope it was).
Have a support system. This could be family members, or a good networking group of investors. Reach out to them when you get the gitters.
A little prayer never hurt either. :)
@James Canoy I can remember the first game I pitched in college. I wanted to throw-up right before I took the mound. Needless to say I didn't have the best first outing... I realized if I wanted to keep my scholarship I had to get it under control. I had been on the mound a thousand times before but it came down to the fact that I was really just afraid of failure. Our pitching coach pointed out that even all-stars lose fairly regularly and to use the fear of failure to fuel my preparation/training habits. As I bought in my game prep habits got much more focused than ever. The better prepared I was, the less performance anxiety I had, the better I pitched.
So, first of all realize that you are going to make some mistakes. We have all made mistakes and we will all continue to makes mistakes here and there. Show me someone who says they have never made a mistake in real estate and I will show you a liar. The key is to minimize the damage from mistakes. Preparation and education is the key. Read everything you can. Listen to podcasts. Find mentors.
You mentioned medical school. I assume you are a physician. In my book I wrote about Physicians White Coat Syndrome, a condition I recognized, that affects Physician's investment decisions. Contact me and I will send you a complimentary digital copy of my book or snag it on Amazon.
You may also want to consider initially partnering in a multifamily deal with a syndicator. Syndicators have the experience you currently lack and if you work with the right one, they will let you shadow them as they walk thru the entire process from market and submarket evaluation, Shopping comps, Underwrite, LOI, PSA, Due Diligence, Financing, Final walk thru, Closing, and Operations.
Also as a physician you may enjoy the passive nature of working with a syndicator. Does your schedule allow time for 1 am leaking toilet calls? What about the water heater that blows or the garbage disposal that jams. there are lots of ways to make money in real estate....decide the lifestyle you want before jumping in to the deep end.
I’m always up for reading more. So if you give me a link I’m more than willing to pay for the book. I’m continually listening to podcasts during my drives.
I would love to work with a syndicator. The only one I know of wasn’t interested and I tried to frame it as beneficial to him though there isn’t much skill set overlap.
I have no interest in being a manager though rental arenof interest. I’m just trying to get going with the funds I do have and I figured flipping was probably the best way to do that.
@James Canoy I can remember the first game I pitched in college. I wanted to throw-up right before I took the mound. Needless to say I didn't have the best first outing... I realized if I wanted to keep my scholarship I had to get it under control. I had been on the mound a thousand times before but it came down to the fact that I was really just afraid of failure. Our pitching coach pointed out that even all-stars lose fairly regularly and to use the fear of failure to fuel my preparation/training habits. As I bought in my game prep habits got much more focused than ever. The better prepared I was, the less performance anxiety I had, the better I pitched.
So, first of all realize that you are going to make some mistakes. We have all made mistakes and we will all continue to makes mistakes here and there. Show me someone who says they have never made a mistake in real estate and I will show you a liar. The key is to minimize the damage from mistakes. Preparation and education is the key. Read everything you can. Listen to podcasts. Find mentors.
You mentioned medical school. I assume you are a physician. In my book I wrote about Physicians White Coat Syndrome, a condition I recognized, that affects Physician's investment decisions. Contact me and I will send you a complimentary digital copy of my book or snag it on Amazon.
You may also want to consider initially partnering in a multifamily deal with a syndicator. Syndicators have the experience you currently lack and if you work with the right one, they will let you shadow them as they walk thru the entire process from market and submarket evaluation, Shopping comps, Underwrite, LOI, PSA, Due Diligence, Financing, Final walk thru, Closing, and Operations.
Also as a physician you may enjoy the passive nature of working with a syndicator. Does your schedule allow time for 1 am leaking toilet calls? What about the water heater that blows or the garbage disposal that jams. there are lots of ways to make money in real estate....decide the lifestyle you want before jumping in to the deep end.
Ironically the sports metaphor fits. I played basketball internationally on a really low level. My nerves killed it but, you’re right there, I just did it. The nerves got better, I got better, and this is probably no different.
My advice is to take care of yourself first if you are really having panic attacks.
@James Canoy - Here is my advice. First off, as long as you buy a deal that you can hold on to during a downturn, you will be safe. Stop looking for the deal of the year and just take action! Make sure it works and in an absolute worst case scenario, you can pay the mortgage payments.
If you still can't seem to drum up the courage to make an offer and stick with it, it's clearly because you are uncomfortable. You need to work on becoming comfortable with discomfort.
How do you do this? "Uncomfortability" is like a muscle. You have to work it out every single day to make it stronger. If you stop, you'll lose it. So every day, try to put yourself in uncomfortable (not dangerous) situations. For example, maybe you drive a new way to work, ask your boss for a raise, get a random person's phone number, or try to negotiate a price down next time you buy something?
Doing these things will make you used to that "uncomfortable" feeling and taking that next step of buying a property will be no problem!
@Michael Knaus, I really liked your positive and encouraging advice to @James Canoy. That advice touched us, touched me too. And I have just actually order the 5 second rule as I too often suffer from panic attacks, but mine seems to be more overthinking stuff, which then just cripples me from moving forward. The panic attacks are bad too for my public speaking career, which I want so bad to master, but the fear and panic gets in the way a lot, so I have got Mel's audiobook and will start listening to it today. :)
@Michael Knaus, I really liked your positive and encouraging advice to @James Canoy. That advice touched us, touched me too. And I have just actually order the 5 second rule as I too often suffer from panic attacks, but mine seems to be more overthinking stuff, which then just cripples me from moving forward. The panic attacks are bad too for my public speaking career, which I want so bad to master, but the fear and panic gets in the way a lot, so I have got Mel's audiobook and will start listening to it today. :)
The issue IS the thinking. Analysis paralysis to the max. I’m ordering the 5 second rule myself.
Your poor realtor! Please buy him/her expensive gifts and if you’re not going to buy something stop wasting his/her time
I’m buying I’m buying. I’m just looking for insight.
I really love the great advice above. It touches me that everyone is soooo nice and giving such empathy and cheering you on James makes us newbies know that we are in the right place, with the right crowd :)!
Agreed. I figure someone here has either dealt with it or has some sort of insight other than “suck it up” or “quit”. Sucking it up is possible but then you get snappy with your wife and kid and make their lives miserable. Quitting is not an option. It’s just...not.
@James Canoy I really feel for you. I suffer from SEVERE claustrophobia with panic attacks. Any situation where I feel physically stuck brings on a panic attack: when a ski lift stops and does not immediately start back up, I don't ever step foot in an elevator, even in a stairwell if I try a door and it doesn't open I will start hyperventilating. I have problems getting dental work done. They have to put me under to do an MRI.
When I get stressed the panic is much, much worse- throughout my life there have been periods when it's better and periods when it's worse but I have found that repeated successful experiences do make it better. Once I've been in a stairwell a couple of times and not gotten stuck it gets easier. I had cancer a while back (treatable) but I had to get radiation which meant laying very still on a table and having them close a big door; the radiation techs were very understanding and would talk me through it and somehow I managed and after six weeks of daily treatment I barely had any panic.
If your wife is on board, maybe she can help reassure you. I hope you can find a way to not let the fear rule your life and stop you from doing what you want to do. It's so hard sometimes.
@James Canoy What whatever it's worth I get a minor panic attack (not completely literal) whenever an offer is ACCEPTED. Why are they selling? Why did they accept my offer? Did I pay too much? Are the tenants horrible and that's why they want out? Did I screw up my pro-forma? Why didn't someone offer more than me? What if all of the tenants bolt the first month after I take ownership? So I "solve" it by rebuilding my pro-forma from scratch. It pretty much always ends up the same. It's not the most productive use of time. And then who knows what happens after the property inspection and lease review stage...sometimes I do it all over again.
Anyway, I'm not exactly "recommending" this as course of action but it's how I deal with it. I also have a couple of people that I run the deal past to make sure that I'm not insane. But I do that before making the offer...which doesn't really help post-acceptance...
@James Canoy anything that is new is definitely going to cause some nervousness. Seeing as I haven't purchased my first property, I know exactly what you are going through. I've had the ability to make a couple offers, but unfortunately nothing as been accepted. I'm a big believer in positive thoughts. No matter what the situation, continue to focus on the positives instead of the negatives. Let me know how everything goes!!!
@James Canoy Congratulations!! Glad to hear you took the plunge. Keep us informed on the progress.
I call it analysis paralysis …….
I have great book you should read.... it helped me when I started...…. Now I am an investor on steroids... just joking
https://www.booktopia.com.au/feel-the-fear-and-do-it-anyway-susan-jeffers/prod9780091947446.html?source=pla&gclid=EAIaIQobChMIiOqquLCt3wIVBB4rCh0USQ26EAQYBSABEgK-v_D_BwE