What is really holding real estate investors back today? How can they overcome it?
It’s easy for outsiders to make assumptions about why aspiring investors aren’t actually doing deals. So I started this trending thread in the BiggerPockets Forums, and here are the top 10 reasons investors say they are still stuck, waiting to do their first deals or waiting to scale investments the way they would like.
The 20 Best Books for Aspiring Real Estate Investors!
Here at BiggerPockets, we believe that self-education is one of the most critical parts of long-term success, in business and in life, of course. This list, compiled by the real estate experts at BiggerPockets, contains 20 of the best books to help you jumpstart your real estate career.
The Top 10 Reasons Newbies Say They’re Stuck
1. Time it Takes to Get Paid
One of the toughest things about going all in to real estate is perceived as being the time it takes to go from zero to closing that first deal and getting paid. So consider starting part-time or finding a route that can put money back in your pocket within 30 days.
Friends and family won’t always get it. They don’t always have to. Don’t try to sell them on joining you full-time. They simply will not always see what you see and are often overprotective. Many will try to keep you in what they consider their comfort zone. Of course, this is normally counterproductive. Get out there and show them it works. Then help them if they decide to join in.
By far one of the most common excuses is not having lots of money to invest or access to private money. If you do want to borrow, be willing to make lots of calls. There is money out there. Or look for real estate investment options that let you get started with just a few thousand dollars. Partner up with others in the same situation and make it happen together.
4. Saving Up Enough
Some try to save their way into real estate. They try to put aside a little from each check towards reserves and buying capital. That’s tough. You can never keep up with inflation, cover emergency bills, or make fast progress this way. Look for a way to leap in now, and let real estate bulk up your finances and income.
5. Finding Inventory Close By
This can be a legitimate roadblock. You may simply not be able to find many deals if you are light on cash and credit and live in high cost areas with intense competition, like parts of California, New York, or Seattle. But you can look out of state and find more affordable deals with better profit margins. Open up your map.
6. Intimidated By Large Dollar Amounts
Some are daunted by the big numbers. They’ve never borrowed or bought anything for $200,000 before, never mind $2 million. But if you have goals that big, you had better start playing with numbers even bigger!
7. High Property Costs
Carrying on from number 5, some find local property really expensive. If you’ve got an average job, and your average local home price is $1M+, that can seem like a challenge. Look elsewhere or partner up.
8. Marketing Budget
A lack of marketing budget can seem like a challenge. Fortunately, there are many guerrilla marketing tactics for real estate. Seek them out, use them, then reinvest and build your budget.
9. Having to Create a Team
Yes, you need a team. Go out and find them. Break out your phone and find local pros to lunch with, consult with, network with, and who are looking to partner up in some way.
The most honest answer to this question is “me.” Most excuses come down to F.E.A.R. (False Evidence Appearing Real). Call it what you want; just don’t try to justify it. The best antidote for this poison is just taking action.
Look out for my next article for more practical solutions you can put into play fast to overcome these obstacles and get your next deal closed faster.
What’s holding YOU back from investing?
Let me know what you’d add to this list with a comment!