First deal hurdles

[David Greene]

Hello,  I was curious who on here is working towards their first deal, and what kinds of hurdles they are personally experiencing in getting there.

[David Greene]

Hi Nicole,

Please dont' feel alone.  Every one of us has felt this when we started.  Some people feel it so strongly it keeps them from starting at all!  Two things to think about.

1) Fear of the unknown:

The majority of fear comes from the unknown. You're scared about what could happen and you don't know what to expect. You don't want to lose money, and you don't want to look like a fool.

Rather than focusing on what could go wrong.  Try to focus on what is reasonable to expect going wrong.  What I mean by that is yes, it is possible your house could get sucked into a sink hole. Your tenants could completely trash it. You could not realize there are tons of liens against it when you buy it. The roof could be ready to collapse any minute. The market could totally drop. Sharknado could descend upon it on the day of closing and eat your tenants. The driveway might have some cracks due to tree roots underneath it. Etc.

While all these things could go wrong, they aren't likely to. And if they were likely to, you would most likely find out about it during the process.  For example: Most areas don't get hit by sinkholes ever, in areas where they do there is insurance for that.  Tenants can trash a place, but using property managers to screen your tenants makes this much more unlikely to happen. A title check during the escrow period should reveal any liens.  A home inspection would reveal the condition of the roof. Making sure your property cash flows properly will keep you safe from shifts in the market. Sharknado only happens in bad movies. The cost to replace the concrete in a cracked driveway may eat up a few months profits but it won't kill you.

If things were going as horribly wrong as you're afraid they will, there wouldn't be a whole bunch of us fighting to buy investment property.

2) Fear of failure:

Most of us don't ever start because we are afraid of failing.  The irony is, we ensure failure by not trying.  You may have this image in your head of needing to know everything, or do perfectly.  The reality is you're going to learn as you go, and that's ok! There are so many financial advantages to owning real estate that even if things go wrong, they usually get balanced out by what goes right.  When I was new, I didn't even expect to turn a profit the first year I owned a property.  I still don't.  And taking that pressure off myself helped me to take action when i was paralyzed by fear of screwing up or looking stupid.

Think about everything else in life.  Who is really ready to be a parent when that happens (I don't have kids but I'm sure I'll never be "ready")? Who doesnt suck at a new job during the first week and hate feeling stupid the whole time? Who learns to surf, or snowboard, or play a sport, or run, or lift weights, or knit, or play video games, or write articles, or TURN ON SOMEONE ELSE'S SHOWER FOR THE FIRST TIME without sucking at it and feeling stupid? It's just the pattern of how life works.  If you can accept it will suck for awhile, your brain will start to adapt and figure it out.  Then it gets fun.  Then it gets addicting.  Then you find yourself on this website everyday reading more crap you didn't know and realizing even as a successful investor you still don't know it all.

So to sum it up, I would say that not acting would be the easiest way to guarantee you never succeed.  Even screwing up hugely on your first, second, or third deal and losing a ton of money can be a big success if you learn enough from it and don't quit.  Imagine if the 4th, 5th, and 6th deals double the money you lost in the first three.  You'd be very glad you didn't quit and wouldn't want that you lost money.  And that's a worst case scenario.  It likely won't be near that bad.

Hope that helped.  Just remember as long as you're learning and moving forward you are winning!