Does the person in the image on the right remind you of someone? Uh Hello! Yes, Im talking about you. Is that what you do when you finally start thinking about how to actually proceed and start investing in Real Estate? Hey! I mean it’s okay if it is. We’ve all been there before. I was super scared when I first decided to do my first deal.
If you have already spent a hundred hours reading everything you can possibly read about real estate investing then you my friend are stuck in analysis paralysis syndrome. This is fear driven syndrome that will eat away at you. You have probably already read every situation on how to invest in real estate. Am I right? I mean with all the free real estate investing books out there and information out on the internet, you are probably over consumed with information. You have probably even read step by step guides on how to invest in real estate yet you still are afraid.
People!! It’s time!! Get off your butt and make it happen! That is one of the stud qualities you need in order to achieve success. Fear and being afraid is not on this list.
What I can tell you is that after the first one, the fear goes away. If your first deal goes well, I can pretty much guarantee you that you will be on a high that feels great. A real estate investing high which can consume you. I admit after my first deal, it took me awhile even after that before I bought another but that was because I was young and stupid. Not because I was afraid anymore. And now I want nothing more but to invest in more real estate.
I urge you to get over these fears already and pull the trigger!! Heck, if you need or want personal advice from me on a deal or anything just shoot me a personal message and I’ll be more than happy to help if I can. If that is what it takes to get you off your butt and pull the trigger then so be it. Remember the end goal here is to make Cash Flow! Retire Early!! All that good stuff. Financial Freedom!
Here are some of the top reasons why you are scared to invest in real estate.
1) I Don’t Have Enough Money
- Okay how long have you been telling yourself this? I hope not years? Once you decide to invest you should be on a hard-core mission to save enough money to at least make a down payment. Stop messing around and really start putting money away so you can invest. Heck you can start by cutting out all your crap bills you pay each month. And if you are super creative, you can find ways to make no or low money down deals. This can be done and people do it all the time. Try reading this book for more ideas on that: The Book on Investing In Real Estate with No (and Low) Money Down
. I personally have always been the pay the down payment and get financing sort of investor but that is because that is the best option for me.
2) It’s Not The Right Time
- If you keep telling yourself this then you will never invest in Real Estate. It’s never the right time! Once you become a Real Estate Investor you will learn that it’s always the right time. There are always deals out there, you just have to search. If there are no deals in your area, go out of state like I did with purchasing a turnkey rental property. No one can predict the future and no one can tell you what will happen. This is why it is imperative that when you do purchase a real estate investment, that you are making cash flow right from the beginning. And I know these deals are out there because I have been finding them. Two of them already just this year.
3) I Can’t Find A Good Deal
- If you are solely looking at zillow to try to find deals then you my friend are doing this wrong! There are deals out there, you just need to know how to find them. Here are some alternative ways to try to find deals: a) Talk to wholesalers, as many as you can and have them send you deals, b) setup MLS listings to email you when a new property that fits your criteria hits the market. A realtor
can set this up for you. c) Network to as many investors as you can, find them on the internet and at local REI clubs, the more people you know, the more chances you have at finding a deal. The deals are out there!! You just need to look deeper and try harder. As I mentioned above, if you just live in a market where its super hard to find deals then don’t be afraid to purchase real estate investments out of state. There is a ton of information out there to help you with this like this blog to begin with. This is exactly how I invest now because there are no more cash flow deals where I live and this is the type of investing I want to do.
4) I Don’t Want To Be A Landlord
- I can see how this may sound troubling for you but I have two words for you folks! Property Management! It is absolutely okay to use a property manager if you don’t want to deal with the headaches of being a landlord. They will do all this for you. All you need to do is make decisions and cough up money when necessary. I have even written out all the interview questions to ask a property manager here for you. Make sure you find a good one and make sure you incorporate all future vacancies/repairs in your numbers so you know you are getting a good deal.
Do these sound familiar to you? These are the common reasons why people are scared to invest and if you let them hold you back you will never achieve your goals. Do not let this happen. Be strong, grow some courage and say “F it”!!
Hey thanks for the post. Now that I have moved into my new house with 3 roommates, I am already licking my chops on the next property that I hope to buy in a year or 2.
What is the price range that you look for in buying a rental house? 100k to 200k? The house I’m in now may be too much risk for renting (290k but easily could rent out and cover expenses), but I would do a lot of research in determining potential tenants.
Have a good day,
Erik
Hey Erik. Ha Yeah it sounds like you have the real estate bug now. It’s great! Price ranges vary on locale but right now I am buying rentals for less then 75k in Indianapolis.
Yep. We have a few other goals we have to hit first, but once those are done, we’ll be saving for a down payment.
And yes, these are real things that we do have to do first. Like a $25k bill next year for my husband’s dental implants. And paying off our mortgage first, since we’re a one-income household. I don’t want to juggle two, even though I know one can pay off the other.
But I’d definitely like to own at least one, if not two or three, rental properties by the time I either slow down or stop working. We’ll be using a property manager, since health issues mean we couldn’t be as on the ball as we’d want.
Well it sounds like you actually have a game plan so you are on the right track. Congrats.
I completely agree on the property management. Makes it so much easier. Thanks for commenting.
These reasons definitely show how people make excuses to avoid doing what they really should be doing. It’s important to look past the negatives and focus on solutions to make everything work out for you. Thanks so much for sharing!
Thanks Drew!! I do think its very important to overcome hurdles and get going!
I am a real estate agent and getting luxury real estate training in an institute. I think this article is helpful for me. I saw many investors scared to invest on real estate. Thanks for your post
Hey Kevin! That is awesome youre an agent and getting additional training. It can only help!! Most of my friends and family are scared to invest even though they see me making money from it. I admit its not super easy and takes knowledge but once youre in the know, its just a matter of pulling the trigger!
Thanks for commenting, I appreciate it!
Very accurate! It’s just last year that I started venturing in real estate, and I can totally relate with number 4! It’s my greatest fear, that I might not be responsible enough to handle everything on my own. Sure I attended few seminars about investing and I am already fully aware of the pros and cons of it, and the thing about bankruptcy is what triggered my fear! I started investing in a condominium and hired a rightful manager, consulted experts and everything turned out well. Believe me when I say never ever regret getting a manager! Sure it’ll cost you, but the profit will definitely get back ten folds!
Hi Kim! I think #4 is a big one for a lot of people and I dont blame you one bit. Property management is awesome and if you find a good property manager, make sure you keep them for life!
This is a really great post, I was one of those people, scared to invest and hovering at the edges of the property investment scene.
I had been aware of the power of investing in property for years, but fear held me back. I read so many articles and books always learning but never taking that first step. I’m not sure why things changed but I think it was when I switched banks and refinanced my mortgage I got brave enough to ask if I could use some of our equity in our home as a deposit for a rental property. The bank said hell yes! Until then I had thought I couldn’t afford to finance a property but the bank supported my lending 100%. So I bought my first investment property. It was probably the scariest thing I’ve ever done. I learnt so much and everyone I dealt with was happy to answer my stupid questions. I ran the numbers and worked through a few “worst case scenarios” that really helped alleviate my fears. I’ve owned that rental for less than a year and the value has already gone up 218,000 to 256,000!! I got really lucky buying at just the right time before the market took off in that area. Too find value I also had to look out of my area, ended up buying 300km away and I hired a property manager too. I really feel like if I can do it, then anybody can.
Wow what a great story you have! Im really happy to hear you pulled the trigger and it worked out. You had the courage to go for it and that is what most people need. Having a lender that supports you is huge and I can see why that pushed you over the edge finally. congrats!
Now to find another!! 😉
Indeed, anytime is going to seem like a bad time, but real estate isn’t as bad as some people think. That doesn’t mean let your guard down, because you still need to work for it to pay off. Hopefully people can get it to pay off for them.
Thank you so much for doing a breakdown of the most common reasons in being scared of investing into the seemingly difficult world of real estate. Your article explained everything clearly and your advice is easy to follow.
Thanks Larissa! 🙂
Great advice here. Investing in property can be tricky so it’s not something you should just dive into without at least a little bit of research. Thanks for sharing.
Thanks Vern!
I know, when I was twenty-one I thought I knew quite a bit. I didn’t. I didn’t know anything about investing in Real Estate. Now today, at 29, I think I know everything. I don’t. And that is how you have to start investing. Thanks for sharing this post it reminded me of my old struggling days.