What is the best way to get over analysis paralysis?

Question

I'm very new. Learning as much as I can for free because I don't have the income to pay for much. I would like Real Estate Investing to be my career, but I feel fear of the unknown. That fear keeps me trying to learn instead of getting out there. Anyone got any ideas for me?

Jeremy T. · Answer

@Brian Stone The way I started was by reading Rich Dad Poor Dad. Then I asked people I knew and family members if anyone was doing rental properties or investing in real estate. A friend of a family member was. That family member, the friend, and me got into a car saw a few properties and I bought one and 6 months later I bought the next one. Both were turnkey properties and I probably over paid by about 30%, but they still cash flowed and when I sold them 2-3 years later I probably broke even or even made a little bit of money.

I knew it was a great thing to do, but I didn't have the confidence to jump in alone so having the family member and someone they trusted lead the way meant I could basically not put too much thought into it and rely on trust. Now... that's not what I would recommend completely but fortunately the outcome wasn't too bad.

That experience taught me what I can and can't do. I can't be a very good landlord, I can't fix anything myself (my wife reminds me of that frequently), and I probably shouldn't be the one negotiating the deal unless it's highly complex because I lack the key ingredient for success in real estate... which is patience! Ultimately, I figured out what I could do - which was understand how businesses operate, build effective teams, and be able to have both the long term strategy and short term tactics in mind.

I then found Bigger Pockets and started trying to network to buy a multifamily property. Then I would network to find good references for financing and property management. I found a guy who agreed to sell me his multifamily property and then turned the tables and said it wasn't for sale but we could still meet and talk about investing together.

@Troy S. met me at a coffee shop and on top of promising to sell me his multifamily property and then not selling it he proceeded to ambush me by having his savvy partner @David Ross present at the first meeting. We talked for about a half hour, I admitted I had no idea how to do much of anything in real estate, they admitted not knowing as much as they could about setting up a company and running a business.

Fast forward a year and we must have done more than 20-25 deals, have a website, and it sort of feels like the real deal. It hasn't been easy - the learning real estate part - but finding people who shared the same values, ethics and principles has made it a lot easier. People talk a lot about getting started in real estate by studying investing strategies, finance and project budgeting, but ultimately, what it comes down to is management and personalities. Do you really think the head of a large company knows that much more about the world to be so much more qualified then you? Maybe, but chances are their greatest strength is knowing how to choose the right team, manage performance, and, hopefully, understanding how to play by the rules and having integrity when it comes to navigating the grey.

Go build your circle of trust.

Account Closed · Answer

Brian,

You have an excellent question. When I too first started in real estate, I also had a bit of analysis paralysis. Being only 22 when I did my first wholesale deal, needless to say there were multiple things causing me to stop in my tracks and keep me from progressing forward. Even to this day, with all of the things I have accomplished, I still get analysis paralysis at times with new ventures.

You did bring up one very important point that you must remember and that is that this is new. Truth be told, the fear that you feel is so common. You are going into unfamiliar ground, and as you stated, you fear the unknown and you don’t know what you don’t know. You have to be able to feel the fear, know that you are not alone in feeling that feeling, and just go do it anyways. It is with the engagement that the fear will disappear.

We as entrepreneurs want to triumph in everything that we put our hands on, however, you need to expect to fail. You need to expect to screw up and not get it right. Even when we try our hardest to accomplish a task, there is no such thing as perfection. You will fail, then when you get up and do it again, you will fail better the next time.

Do not be afraid of those small beginnings. You don’t have to have a million dollar portfolio tomorrow or have done however many hundreds of deals. Have you heard of the compound effect? It is the little things done consistently over time which allow us to gain traction and create bigger things. Start small and work your way into something bigger. As you grow and continue to go forward, the fear will dissipate and you will become much more confident with your investing knowledge and skills.

Another thing that works is to have a mentor that you can reference in times of trouble. When I started, I did not pull the trigger on my first deal until I had someone that knew a bit more about investing than I did. I can say that this definitely helped when I wasn’t as confident in my abilities, I was confident that my mentor was guiding me in the right direction. I did have to pay for my mentor which was a monthly fee of less than $200 a month. I think that that was not too bad for the advice that I received.

The last thing that I can say which has helped me is to break things down into tasks. For organization, I follow the GTD (Getting Things Done) method which has definitely helped me accomplish everyday tasks. I also use ToDoIst which is a task list system where you essentially are awarded for the tasks you complete. Definitely helps when even when you are scared to do something, you have this task list staring you in the face and see that your points are going down because you are not accomplishing these things. Make sure to check out the GTD method and ToDoIst when you have time!

I know this has been a long post, but this subject is something that I am very passionate about and I hope I was able to help you some.

Feel free to contact me if you have any questions. If there is any way I can help you move forward, I am happy to help.

Jill DeWit · Answer

@Brian Stone

Sure Brian! Start out with an easy transaction, like vacant land, and pay cash. You can find properties for as little as $150-500 (for a full acre or more!) with access, in established areas, and pay cash.

You will get to practice finding the property, buying, transferring ownership, marketing, selling, working with counties, etc. Get a few of those under your belt and grow to more or bigger properties.

You do not need a license. It's like the old FSBO way. (For Sale By Owner) Since you paid cash, you can take your time learning and marketing.

Start with a $500 property. Easy to resell for double or triple - then repeat.

Hope that helps! Jill

Jeff B. · Answer

hmm; While you are learning, especially here on BP, education costs your NOTHING! (if you're bright enough to stay away from those $xx,xxx mentoring programs).

[begin rant] There are those that advocate "just take action", and that's ok, after all, it's your money at risk, not theirs.  Action without adequate preparation is like diving into the deep end of the pool not knowing how to swim.  Yeah, if you're luck you may make it to pool side, but that's one heck of a risk.  The other analogy is placing an ante on the poker table, and saying ok someone teach me to play poker.[end rant]

There are several types of Real Estate Investing(REI):

• Buy & Hold, where you become a landlord
• Rehab-Flipping where you take a distressed property, fix it up and then sell at a FMV (aka ARV) to keep a margin.

Then too there's various means to get 'control' of a property:

• Tax Liens
• Foreclosure Auctions
• and various forms of wholesaling, taking Subject To, creating a 'Wrap'

Your personality, background and goals in REI will preclude some and lead you to favor others.  Great; now Take Action (if you will) to learn the steps, skills and process used by the path you have chosen.  You don't need to be able to define or write all the contracts, but you should at lease Know the rules of the game you wish to play.

REI is never profitable using the trial-and-error approach, but it sure gets expensive quickly that way.

Garry C. · Answer

As you've already noted, the response here on BP is great, lots of people ready to help. If you think you've found a deal, post about it in the forums and ask for advice. You'll get plenty, most of it good. If a few people say 'looks good, go for it', that should help you get over your fear and make a move. If it's not a great deal, people won't hesitate to point that out and let you know what to do differently in order to find better deals.

Brian Stone · Answer

I'm overwhelmed. Over inspired at such quick and most helpful responses. It really showed me what a community BP really has. I signed up the same day as I posted this. So amazed. Thank you.

Luke Smith · Answer

Nice, topic. Got this thread flagged in my email. Saw it come up while I was on the phone with a lady I made an offer to. Offered to buy her 5 acres for $500. She called me back and wanted to complain about paying 20K for that vacant land a long time ago. She has been paying taxes for years and years. She had a real estate agent list it years ago for 35K and has not had one offer or any interest in the property since. My $500 offer is her first and only offer. She still wants 35K but said she might take me up on my offer if no one else makes an offer.

Not sure what I could sell it for but at $500 for 5 acres in a county where the cheapest listed 5 acres is over 2 grand I think there is some room for error.

Steve Smith · Answer

@Brian Stone

I had the same problem the way I overcame it was. To start making offers. You can analize all day until you make offers your situation won't change

Make it happen

Steve

What is the best way to get over analysis paralysis?

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