Mental block buying your first property

[Margarita Artiushenko]

Wondering if others have had any mental blocks when making offers on their first property or buying their first property in general.
What were they and how did you overcome them?

[Bruce Woodruff]

Quote from @Margarita Artiushenko:

Wondering if others have had any mental blocks when making offers on their first property or buying their first property in general.
What were they and how did you overcome them?

I'm the opposite....I jut plow ahead and get myself into trouble :-)

My business strategy is 'paint yourself into a corner and figure a way out'. Really.

But if you are having paralysis, one thing that works is to analyze the crap out of the deals. Build your own spreadsheets, do comparisons until you're blue in the face, walk neighborhoods until you're crippled. This tends to build an inner confidence because you know that you know everything......

Do not rely on Social Media and Apps and the 'how can I make it easier' mindset....

[Jeff Roth]

Hi Margarita-

Great question.

There are many mental blocks and friction points to buying your first property.

First off, just buying property outside of a first or second home to use is not done by most people and buying your first home is a major purchase for most people.

That means the people in our immediate sphere of influence are not thinking about buying investment property, they see it as risky and out of a sense of protecting you or themselves encourage you not to do it.

I remember having the same mental blocks and fears you probably do thinking about buying your first property or first investment property.

The most critical thing to overcoming these mental blocks is self education and surrounding yourself with the best team of people to help you.

An investor friendly Realtor who can refer you to an investor friendly lender, title company or closing office, property inspector, property manager, and insurance agent.

Real estate is relational and having the best team will keep you out of the weeds.

To Your Success!

[Brian Jackson]

I think everyone has these mental blocks. Depending on your risk tolerance, make sure you are financially ready for the worst scenario. Other than that just do it and rely on those in the forums or your inner circle to help guide you through the process. Best of luck!

[Manny Vasquez]

Yes, I think a lot of BiggerPockets members will admit to suffering from  "Analysis, Paralysis", I know I did!  I also had fear of the "unknown" and fear of "not making it".  However, I sat down with a Real Estate mentor at the time and we looked at all of the "What-Ifs".  He discussed each one of my fears in detail and logically explained how those fears were "far away" from happening.  Pretty much he gave me the confidence to move forward with my first purchase and I haven't looked back since!

Every now and then, some "Analysis-Paralysis" flares up again and those other fears will rear their ugly heads.  But I quickly spell them away.  A couple of quotes I always like to use to give myself confidence are:

"Timing the market does not work, however, Time In the market makes all the difference in the world!"

"Knowledge is Power but Knowledge without Action is useless.  Therefore, put what you learn into Action!

Its totally normal to have some mental blocks before your first purchase. It happens to all of us. That's what the BiggerPockets community is for, to help you get over them.  Anytime you have some mental blocks, share them here and we will help you walk right through them.

I hope this helps and good luck!

[Margarita Artiushenko]

Quote from @Manny Vasquez:

Yes, I think a lot of BiggerPockets members will admit to suffering from  "Analysis, Paralysis", I know I did!  I also had fear of the "unknown" and fear of "not making it".  However, I sat down with a Real Estate mentor at the time and we looked at all of the "What-Ifs".  He discussed each one of my fears in detail and logically explained how those fears were "far away" from happening.  Pretty much he gave me the confidence to move forward with my first purchase and I haven't looked back since!

Every now and then, some "Analysis-Paralysis" flares up again and those other fears will rear their ugly heads.  But I quickly spell them away.  A couple of quotes I always like to use to give myself confidence are:

"Timing the market does not work, however, Time In the market makes all the difference in the world!"

"Knowledge is Power but Knowledge without Action is useless.  Therefore, put what you learn into Action!

Its totally normal to have some mental blocks before your first purchase. It happens to all of us. That's what the BiggerPockets community is for, to help you get over them.  Anytime you have some mental blocks, share them here and we will help you walk right through them.

I hope this helps and good luck!

 Thank you for your thorough reply!
How did you find your mentor?
I listen to podcasts, read books, use BiggerPockets calculators, do my own analysis, have an agent and lenders. Maybe the mentor is the missing part?

[Margarita Artiushenko]

Quote from @Bruce Woodruff:

Quote from @Margarita Artiushenko:

Wondering if others have had any mental blocks when making offers on their first property or buying their first property in general.
What were they and how did you overcome them?

I'm the opposite....I jut plow ahead and get myself into trouble :-)

My business strategy is 'paint yourself into a corner and figure a way out'. Really.

But if you are having paralysis, one thing that works is to analyze the crap out of the deals. Build your own spreadsheets, do comparisons until you're blue in the face, walk neighborhoods until you're crippled. This tends to build an inner confidence because you know that you know everything......

Do not rely on Social Media and Apps and the 'how can I make it easier' mindset....

 Thank you! I like your strategy. Great advice too!

[Manny Vasquez]

Quote from @Margarita Artiushenko:

Quote from @Manny Vasquez:

Yes, I think a lot of BiggerPockets members will admit to suffering from  "Analysis, Paralysis", I know I did!  I also had fear of the "unknown" and fear of "not making it".  However, I sat down with a Real Estate mentor at the time and we looked at all of the "What-Ifs".  He discussed each one of my fears in detail and logically explained how those fears were "far away" from happening.  Pretty much he gave me the confidence to move forward with my first purchase and I haven't looked back since!

Every now and then, some "Analysis-Paralysis" flares up again and those other fears will rear their ugly heads.  But I quickly spell them away.  A couple of quotes I always like to use to give myself confidence are:

"Timing the market does not work, however, Time In the market makes all the difference in the world!"

"Knowledge is Power but Knowledge without Action is useless.  Therefore, put what you learn into Action!

Its totally normal to have some mental blocks before your first purchase. It happens to all of us. That's what the BiggerPockets community is for, to help you get over them.  Anytime you have some mental blocks, share them here and we will help you walk right through them.

I hope this helps and good luck!

 Thank you for your thorough reply!
How did you find your mentor?
I listen to podcasts, read books, use BiggerPockets calculators, do my own analysis, have an agent and lenders. Maybe the mentor is the missing part?

I found my mentor through a friend of mine. It turns out my friend had told me about his uncle who owned several properties across Orange County.  Since I was young I knew that I had always wanted to own properties so when my friend told me about his uncle, I asked my fried if I could meet his uncle so that I could ask him about his properties.  My friend arranged for us to meet and I was amazed how much of smart yet simple guy he was, super down to earth.  I was envisioning some dude with expensive bespoke suits, gold watches and driving around in a Rolls Royce but he was super chill and down to earth.  In short, he seemd like a "regular Joe" and he had this laid-back style about him and he explained property ownership in simple terms (I was 24 at the time) for me to understand.  His tone was upbeat and positive (it still is) and he pretty much gave me the confidence to move forward.  

I don't think I ever asked him specifically to be a "mentor", it just happened organically. He gave me his number and he said I could call him at anytime regarding any question.  He also told me that I could use his team of plumbers, electricians, flooring guys, etc if I ever needed help with any of that.....and so I did.  Right before buying my first home, I ran the deal by him and I kept him in the loop throughout the transaction.  He kinda "held my hand" through the process which gave me greater confidence. Every now and then I would call him with questions or run ideas by him to get his opinion.  As a matter of fact, I still call him every now and then and I thanked him for being so kind and motivating me into buying properties. 

What I would recommend, is to find someone that you know that owns properties and ask them if they would be willing to answer some of your questions, possibly serve as a mentor for you.  You will know from your conversations who is a right fit for you and who is not. 

I hope this helps!

[V.G Jason]

This isn't therapy. You do your diligence, you assess your risk tolerance, and you keep it moving.

[Ken M.]

Quote from @Margarita Artiushenko:

Wondering if others have had any mental blocks when making offers on their first property or buying their first property in general.
What were they and how did you overcome them?

@Margarita Artiushenko: There are millions of people that feel the way you do.

There are 4,000 new people every week at Bigger Pockets that feel the same way. The solution is to find a group or someone, to help you make the decisions and to get things moving.

When you learn to ride a bike, someone holds the bike while you get on and then teaches you how to peddle, steer and brake. It's pretty simple after you learn the fundamentals. People who answer your questions are the group you start with, in selecting that person to help you get you through the indecision.

[Michael Smythe]

@Margarita Artiushenko knowing the numbers and understanding investing requires risk taking.

[Julian Broyles]

Quote from @Margarita Artiushenko:

Wondering if others have had any mental blocks when making offers on their first property or buying their first property in general.
What were they and how did you overcome them?

 The mentor thing I agree. But you need a partner or accountability partner. 

[Rick Albert]

There are couple of things you can do:

1. Figure out why the block is there. What are the concerns and how can you address it? For example a lot of my clients are concerned if it is a "good deal." I then proceed to show them comparable sales in the area and a report we pay for that shows projected appreciation rates based on a variety of data. 

2. I have what I call "Rick Proverbs." One of which is the "F*** It Price." If you are on the fence, at what price would you say, "screw it, at this price it makes sense." I had a house hacking client do it and it ended up being a phenomenal deal. 

3. You have to remember that real estate is a long term game, not short term. In the big scheme of things, on a typical property (nothing crazy like major hillside work, septic, etc.) you can screw up pretty bad and if you hold on to the property long enough, it will likely work itself out. When we bought our second house hack, we made a lot of mistakes. My wife and I ended up moving into our 360 square foot ADU instead of the beautiful home we remodeled and expanded. I even thought about selling mid construction. But I had to take a second and remember that things take time. Fast forward to today and we are in the main house, and I was able to take a HELOC out and buy an investment property, and with my tenants in place we are paying below $2K/month to live in a 3 bed house with a nice backyard.

Your team (Realtor and Lender) should be able to walk you through the process. They can double as mentors and partners because if you buy a property at a good value, everyone wins. I have a house hacking client where we are on the search for his third property in three years. 

[Peter Mckernan]

Quote from @Margarita Artiushenko:

Wondering if others have had any mental blocks when making offers on their first property or buying their first property in general.
What were they and how did you overcome them?

 My first deal was something I just jumped into without running the numbers... It worked out fortunately lol! I know that they say run the numbers.. I never did and was lucky to have made it out alive! 

The fact is that having a mental block happens to all of us, some with work, some with business, some with fitness, and some with real estate investing. The truth is that you need to get a partner or mentor.. I would say partner, someone that has been doing it for a few years or longer. There are three people in the deal triangle (this is my thought), deal finder, deal funder, and project manager. If you have small amounts of capital and cannot find the deal, go for the PM route and do one deal like that then the next one.. 

You can learn through the process and get to a place that will be hugely beneficial for the learning experience for you and build confidence. Then you can go the next one with the partner and then the next one and then the training wheels are off! 

[James Allen]

Yes, I was worried about making a costly mistake on my first property or buying a bad deal or in a bad area. A lot of this can be solved by doing the work upfront. Taking time to educate yourself on your market, drive the streets around your target zip code or area so you know the good streets, bad streets, and up and coming streets. Taking the time to speak to local investors and know what an average roi is for your area. In addition, run the numbers on dozens of deals yourself so you can confirm what an average deal, good deal, and great deal looks like in your market.  

I did this for a while before making my first purchase and this gave me the confidence I needed to move forward. I purchased my first rental out of state and it was a success and led to buying many more great deals. 

[Joseph Bui]

Took me a bit to overcome analysis paralysis for purchasing my first property. In the end, what I thought about was this, my capital needs to be invested "somewhere". I have some in etfs already. I need to diversify. Whats the worst case scenario for investing in Real Estate? Whatever the worst case sceneario is, its much less severe than investing in the stock market. Plus, I realized the only way to learn is to take action. Thats why I started in cheaper cash flowing midwest markets and now sit at 9 doors across Memphis and Detroit and looking to add more. Happy to connect if you want to chat about overcoming the "first property hurdle" and or anything else.

[Carlos Valencia]

Hi Margarita, 

is this your first purchase? if it is its normal to have mental blocks or experience paralysis analysis. If your purchasing your first investment. First thing is you need to remind yourself on what your goals are for this property. Are you trying to flip it, house hack it, mid term rent, long term rent. Adding value to the property to be able to rent it out for as much as possible. Make sure your due your research and create yourself a check list that makes sense to you so when your out there making offers you can take that property through your checklist and see if that property meets your needs for what you are trying to accomplish. Current market especially in Los Angeles is very challenging to find a positive cash flowing property. Might be like finding a needle in a haystack. In Los angeles at least you know you will have appreciation if your going to hold for long term but don't expect much cashflow. You will be lucky to break even on paper. Good luck on your search hope this helps get you out of that mental block.

@Albert Bui @Matthew Kwan

[Jake Andronico]

@Margarita Artiushenko

Absolutely. It will ALWAYS feel scary at some point no matter how good the property/deal is. 

I always advise my clients that even if we are in escrow on a property they do NOT have to purchase it. 

There are multiple outs in the contract and making sure they know what's at stake and when is incredibly important. 

Sometimes reframing it helps a lot as well. There are 20-40 properties that are purchased in our relatively small market each and every day. The horror stories are minimal, and if you trust yourself enough if things get rough to figure it out, you will. 

Best of luck to you! 

[Nina Penuela]

Hey @Margarita Artiushenko

From my experience, I've seen investors doubt and have fear of making a mistake or choosing the wrong investment. The pressure of committing significant capital and potentially facing financial repercussions if things didn't go as planned.

To overcome this, I´ve helped them by educating them thoroughly about the real estate market and conducting extensive research on potential properties. They start gaining confidence to make informed decisions and mitigate risks effectively.

Looking forward to hearing your thoughts!

[Jeremiah Dunakin]

I had mental block/analysis paralysis. I had a 1000 reasons not to buy a property.

1. I was gonna get sued, I have an umbrella policy and a good lease agreement.

2. I don’t know what I’m doing, you only get better at things by doing them. I still don’t know what I’m doing 2 years later but I know a tad more

3. No one will want to rent my property, I had probably close to a 100 replies. We found a good tenant through rent redi helping with the background checks

4. I have to get a perfect deal like I hear on podcast. I bought when the market was crazy. I got out of work to go see a house at 3:30 by the time I got there it had an offer on it. This happened a couple times. I ended up getting a small place that I spent way too much time and money on. However once I got it going it has been great and I learned so much.The perfect deals of buying a duplex for 40k and then discovering it actually a triplex by putting  a 500$ wall and door in, then the value is 400k cash flowing 3k a month with 41k isn’t real life. I know someone will say I get those deals all the time kuddos to them.Most of us ain’t that

5. I don’t want three o clock phone calls. If you don’t want hire a PM m, however it will take a substantial part of income. I am fairly handy and deal with calls myself. The shower wasn’t hot (I looked at anti scald it was to low. Door lock was finicky, nowhere to plug tv in hired an electrician to install a new outlet. I’m not saying things won’t happen but I don’t think that things are as bad as people make them seem. I try and stay ahead of the game on PMs I change air filters and get furnace serviced I replace shut off valves and add them where needed. Piping is old I replace it before it breaks. If I see that a pipe only has a couple years left in it I change it before it breaks. 

There are a million reasons not to take the step but the reward is worth it. You can do it.