The Fallacy of Waiting in Real Estate Investing: Embracing the Power of Action

[Jacob Deacon]

In the realm of real estate investing and in life, the allure of waiting for the perfect time to strike often tempts many individuals. Dreams of landing a grand "home run" deal can be captivating, but it's crucial to recognize that such opportunities are exceedingly rare. As a seasoned professional in the industry, I advocate for a different approach. Instead of holding out indefinitely for the ideal moment, consider the power of starting with smaller wins—a single or a double—when it comes to real estate investments. By taking action and gaining valuable experience, you open the door to continuous growth and progress in this dynamic market.

The truth is, the perfect time for real estate investing may never manifest. Market conditions are ever-changing, and delaying action in pursuit of an elusive moment can lead to missed chances and a stagnant portfolio. Embracing the philosophy of getting in the game, making well-informed moves, and learning from each investment is the key to success. Even if you encounter setbacks, each experience serves as a valuable building block for your real estate journey. So, let go of the misconception that the right time is just around the corner. Instead, embrace the world of real estate investing, savor the learning process, and watch how swiftly you grow with an action-oriented mindset.

[Randall Alan]

Quote from @Jacob Deacon:

In the realm of real estate investing and in life, the allure of waiting for the perfect time to strike often tempts many individuals. Dreams of landing a grand "home run" deal can be captivating, but it's crucial to recognize that such opportunities are exceedingly rare. As a seasoned professional in the industry, I advocate for a different approach. Instead of holding out indefinitely for the ideal moment, consider the power of starting with smaller wins—a single or a double—when it comes to real estate investments. By taking action and gaining valuable experience, you open the door to continuous growth and progress in this dynamic market.

The truth is, the perfect time for real estate investing may never manifest. Market conditions are ever-changing, and delaying action in pursuit of an elusive moment can lead to missed chances and a stagnant portfolio. Embracing the philosophy of getting in the game, making well-informed moves, and learning from each investment is the key to success. Even if you encounter setbacks, each experience serves as a valuable building block for your real estate journey. So, let go of the misconception that the right time is just around the corner. Instead, embrace the world of real estate investing, savor the learning process, and watch how swiftly you grow with an action-oriented mindset.

@Jacob Deacon

Maybe… but maybe not (in my opinion).  All things being equal - if you have a deal that cash flows well (for a hold)… I would agree with you.   

I think you have to look at the opportunity costs of how you spend your money.  $50,000 invested to buy a $200,000 house that cash flows $150/month nets you $1,800/year.  Yes, hopefully you get appreciation… but certainly not what we saw in the last 2 years.  You will have an interest rate you will want to refi as soon as rates come down costing you several thousand dollars - offsetting any early gains you make.  Plus you have the risks associated with maintaining the property, turnover, vacancy, etc. 

Meanwhile, the same $50,000 in a 5% high interest savings account is going to yield $2,500 + compounding risk free while you wait for rates to start coming down next year.  (Yes, they will go up two more times this year … but that still doesn’t make 7.5% a rate I want to invest in now regardless).   

So while I’m all about getting started, I think you have to suffix your proposition with the phrase “with a deal that makes sense and is the best use of your money” and worth holding in the meantime.  

I think one has to acknowledge that real estate isn’t ALWAYS the best option at every turn, and right now it is an uphill battle for the majority of the country.  I’ve bought 37 units in the past 5 years.  But they all cash flowed at least $300/door when I purchased them, and since then have increased that by over two fold.  I wouldn’t advocate buying something that cash flowed poorly at something like $50-$100/month just to get started.   It’s not worth the investment / not the best use of your money in the current environment in my opinion.

All the best!

Randy