So what's holding you back?

[Frank Patalano]

When I help new investors with buying their first property I often want to know what is holding them back from pulling the trigger.

So I'll ask here. What is holding you back?

[Kristen Reyes]

@Frank Patalano 

Thanks for the advice. My plan is to try to find some local meetups. I already found one in the area. The more knowledge I can get the less fear I will have to take the plunge!

NWI- Northwest Indiana. All the cities I would look in would be 35 minutes- 1 hour from Chicago. This is a diverse area. You can go from an impoverished Gary to a very well off St. John- So I want to select my market carefully. 

Because I already run an online Ecommerce business and am a work-at-home mom with 2 little ones, I feel like I will do my first property within 20 minutes drive. That narrows it down a bit for me. 

If you don't mind asking- what are your criteria for selecting your market? What stats are you looking for an in an area?

[Clifton Morgan]

Originally posted by : @Frank Patalano

Originally posted by @Clifton Morgan:

I have serious analysis paralysis. Literally at the brink of purchasing this property in Tx, but after doing the numbers I noticed the taxes are so high there. Also noticed the market is super neutral and afraid that if I ever wanted to cash out it would be extremely difficult. Luckily it already has a paying tenant but the cash flow would only be about 200-300/month. Really just interested in the property due to the high equity currently (buying under market) but overall the mtg is high and scared of potential long-term vacancies down the road with potential recession looming...mtg expenses too high for that. See what I mean about the paralysis lol.

 If it is a decent property, why would there be long-term vacancies? If you're buying the property was such a high equity, can't you flip it or wholesale it instead?

what do you mean when you say super neutral?

my suggestion is to take the best deal you can find. If something is Cash flowing positive a couple hundred dollars a month, go for it. You will learn so much more as an owner then as someone who plays with numbers.

@Frank Patalano Thanks for your reply! By super neutral I just meant that I noticed homes are staying on the market for longer time and selling under market.

And you’re right, it is nice so long term vacancies likely won’t happen but there may be a month or so where it is vacant in between tenants and because it is in the mid 200s I’m afraid that I could be taking on too much where the monthly payments are close to 2k/month.  

This would be my first, which is why there is so much hesitancy I believe and I don’t wanna talk myself out of a potential good deal. Just worried im taking on more than what I can potentially handle in the event the market down take a down turn at all. Should I even be thinking this hard about that?

[Frank Patalano]

Originally posted by @Larry Smith:

@Frank Pw2atalano

For me, I'm in the military and do not know what my next move will be and I would like to be local to learn from my team as well as maintain some control. More than that, I have 10K+ saved and it seems like in Maryland and Virginia where I am now, I may need a little more little money to cover closing and or the down payment. I have a realtor and potential lender that I am in contact with, so I based the second hold-back off of conversations we have had pertaining to the local area. Hopefully these do not sound like a copout, but I want to ensure that when I make that move for the first time, that I'm all in and not putting my family in a bad situation at the same time.

 Hi Larry. In Baltimore this weekend.

You should probably partner. Especially one with Money.

Have you looked into VA Loans?

[Frank Patalano]

Originally posted by @Account Closed:

They aren't accepting new STRs, they're limited to only a certain number of Short term Rentals in residential zones. Pretty much everything near Disney is a Residential zone. And the applications in other cities are expensive and need to be renewed and there's laws saying that you and the renters can be fined if there are noise complaints. Other cities limit the STRs to 5% of the communities and other cities and township just straight up prohibit them.

Today, The wife and I decided to just do our STRs throughout Europe. There's still cities with those regulations like Paris and Barcelona and a few others, but they aren't as strict.

 Sounds like you are already being creative. Over regulation sucks.

[Frank Patalano]

Originally posted by @Clifton Morgan:

Originally posted by : @Frank Patalano

Originally posted by @Clifton Morgan:

I have serious analysis paralysis. Literally at the brink of purchasing this property in Tx, but after doing the numbers I noticed the taxes are so high there. Also noticed the market is super neutral and afraid that if I ever wanted to cash out it would be extremely difficult. Luckily it already has a paying tenant but the cash flow would only be about 200-300/month. Really just interested in the property due to the high equity currently (buying under market) but overall the mtg is high and scared of potential long-term vacancies down the road with potential recession looming...mtg expenses too high for that. See what I mean about the paralysis lol.

 If it is a decent property, why would there be long-term vacancies? If you're buying the property was such a high equity, can't you flip it or wholesale it instead?

what do you mean when you say super neutral?

my suggestion is to take the best deal you can find. If something is Cash flowing positive a couple hundred dollars a month, go for it. You will learn so much more as an owner then as someone who plays with numbers.

@Frank Patalano Thanks for your reply! By super neutral I just meant that I noticed homes are staying on the market for longer time and selling under market.

And you’re right, it is nice so long term vacancies likely won’t happen but there may be a month or so where it is vacant in between tenants and because it is in the mid 200s I’m afraid that I could be taking on too much where the monthly payments are close to 2k/month.  

This would be my first, which is why there is so much hesitancy I believe and I don’t wanna talk myself out of a potential good deal. Just worried im taking on more than what I can potentially handle in the event the market down take a down turn at all. Should I even be thinking this hard about that?

 You always need to have an emergency fund in case there is a vacancy or turnover.

Like I said before buy the best deal that you can find. You will learn so much more as an owner.

Build experience on one now. Then you can get more if the market turns.

[Anita Moore-Bohannon]

What’s holding me back is feeling like I don’t know enough yet. I have spent countless hours reading and studying real estate but yet, I am afraid to make a move.

[Donnie Wiseman]

For me, it's complete lack of knowledge in this industry. I'm not sure what to learn first... I read though Bigger Pockets' "Ultimate Beginner's Guide," but that seems to merely scratch the surface. I'm looking to quickly gain knowledge and confidence first and foremost, but my other limitation is funds...

[Frank Patalano]

Originally posted by @Anita Moore-Bohannon:

What’s holding me back is feeling like I don’t know enough yet. I have spent countless hours reading and studying real estate but yet, I am afraid to make a move.

 I don't know everything that there is know about real estate. I build strong Partnerships with people who know what I don't know.

[Frank Patalano]

Originally posted by @Donnie Wiseman:

For me, it's complete lack of knowledge in this industry. I'm not sure what to learn first... I read though Bigger Pockets' "Ultimate Beginner's Guide," but that seems to merely scratch the surface. I'm looking to quickly gain knowledge and confidence first and foremost, but my other limitation is funds...

 Pick a strategy and learn everything that you can. Also network. Keep reading. Keep learning.

[Joshua Marcano]

@Frank Patalano

Money and education

[Frank Patalano]

Originally posted by @Joshua Marcano:

@Frank Patalano

Money and education

 You can get tons of free education right now. Books out of the library and online podcasts. Money is slightly harder but not impossible with real estate. You really did not give me enough information to help with you money issue.

[Chris Salerno]

Originally posted by @Frank Patalano:

Originally posted by @Chris Salerno:

Myself from growing. 

 Chris. You are doing just fine. At the same point, mindset goes a long way.

Frank thank you. I am looking forward to connecting in person. I have a very strong and positive mindset. But I always feel I can push myself harder. Looking forward to connecting. Are you going to jake and gino event? 

[Frank Patalano]

Originally posted by @Chris Salerno:

Originally posted by @Frank Patalano:

Originally posted by @Chris Salerno:

Myself from growing. 

 Chris. You are doing just fine. At the same point, mindset goes a long way.

Frank thank you. I am looking forward to connecting in person. I have a very strong and positive mindset. But I always feel I can push myself harder. Looking forward to connecting. Are you going to jake and gino event? 

 At Rod's Event right now. Paige F says Hi. Can't make Jake and Gino. I have to be home more. In Boston next weekend (Chose Boston over Denver, closer). Was in Brooklyn last weekend. 

If someone says that you are working too hard, only listen to them if they are working harder than you. 

Always great to chat.

[Chris Salerno]

Originally posted by @Frank Patalano:

Originally posted by @Chris Salerno:

Originally posted by @Frank Patalano:

Originally posted by @Chris Salerno:

Myself from growing. 

 Chris. You are doing just fine. At the same point, mindset goes a long way.

Frank thank you. I am looking forward to connecting in person. I have a very strong and positive mindset. But I always feel I can push myself harder. Looking forward to connecting. Are you going to jake and gino event? 

 At Rod's Event right now. Paige F says Hi. Can't make Jake and Gino. I have to be home more. In Boston next weekend (Chose Boston over Denver, closer). Was in Brooklyn last weekend. 

If someone says that you are working too hard, only listen to them if they are working harder than you. 

Always great to chat.

You are correct! Well, I am sure we will connect very soon! HELLO Paige! super excited to connect with her also! 

[John D McCreary Jr]

@Frank Patalano

The following are my hold backs.

Beginners Fear/Unknown

What backend systems needed?

Essential automation

PMLs/HMLs

Regards,

JD McCreary

[Frank Patalano]

Originally posted by @John D McCreary Jr:

@Frank Patalano

The following are my hold backs.

Beginners Fear/Unknown

What backend systems needed?

Essential automation

PMLs/HMLs

Regards,

JD McCreary

 More knowledge reduces but does not eliminate fear.

Back end systems? Depends on investing strategy.

Essential automation? Are you self managing?

You can find non-traditional lenders at your local REIA.

[Philip Jansen]

@Frank Patalano right now I'm actually in a pretty good position to start out. I have a strong income from my janitorial company that employs approx 160 people in Lubbock Texas. I have some capital but can quickly raise more. I'm a pretty conservative guy so until I get a few under my belt I don't plan on over leveraging just right way. I do own the office/warehouse that my company leases from my LLC. I'm excited because I purchased the land (a half acre) right on the growth pattern of the city for 62k and now the lot next to me asking price is 195k. So 1st step for me is I want to set up another LLC and second step will be to get with a commercial lender to arrange a commercial line of credit as I'm wanting to make all cash offers. I'm really excited about the BRRRR method. I just hope I have success analyzing the deals!

[Jason Brubaker]

@Frank Patalano a job that used to be 40-50 hours per week slowly building itself up to 100+ in hard weeks and 60 on slower weeks on a salaried position.

I’ve bought one small multi before work cranked up this many hours but haven’t moved forward in the field for three years now. It has cost me a spouse, forward motion, and trying its best to remove any remaining self-respect. I know what I eventually need to do but I don’t know how to do it.

[Michael Nichols]

@Frank Patalano

After reading Dave Ramsey’s money makeover, I feel as though I need to wipe out all of my debt (mortgage not included) before I start investing in real estate. I have about 15k left until I am free and clear of everything except my mortgage. Once I do that, I am going to save enough money for a 20% down payment towards a rental property investment. Any suggestions or tips are appreciated.

[Terry Thomas]

@Frank Patalano Will do! Thank you, sir. :) 

[Frank Patalano]

Originally posted by @Philip Jansen:

@Frank Patalano right now I'm actually in a pretty good position to start out. I have a strong income from my janitorial company that employs approx 160 people in Lubbock Texas. I have some capital but can quickly raise more. I'm a pretty conservative guy so until I get a few under my belt I don't plan on over leveraging just right way. I do own the office/warehouse that my company leases from my LLC. I'm excited because I purchased the land (a half acre) right on the growth pattern of the city for 62k and now the lot next to me asking price is 195k. So 1st step for me is I want to set up another LLC and second step will be to get with a commercial lender to arrange a commercial line of credit as I'm wanting to make all cash offers. I'm really excited about the BRRRR method. I just hope I have success analyzing the deals!

Perhaps I am misunderstanding what you are trying to say, I don't know many lenders that will give you a loan on vacant land. 

I would join a local REIA and keep educating myself and networking.

The BRRRR method is a fine stategy. I'm more a fan of cashflow but wouldn't complain about having chunks once in a while.

[Frank Patalano]

Originally posted by @Jason Brubaker:

@Frank Patalano a job that used to be 40-50 hours per week slowly building itself up to 100+ in hard weeks and 60 on slower weeks on a salaried position.

I’ve bought one small multi before work cranked up this many hours but haven’t moved forward in the field for three years now. It has cost me a spouse, forward motion, and trying its best to remove any remaining self-respect. I know what I eventually need to do but I don’t know how to do it.

 What type of job is it?

Out of 3 things what would be your strength? Experience, Money, Time. Obviously its not time but those are the big three.

[Frank Patalano]

Originally posted by @Michael Nichols:

@Frank Patalano

After reading Dave Ramsey’s money makeover, I feel as though I need to wipe out all of my debt (mortgage not included) before I start investing in real estate. I have about 15k left until I am free and clear of everything except my mortgage. Once I do that, I am going to save enough money for a 20% down payment towards a rental property investment. Any suggestions or tips are appreciated.

 I love Dave Ramsey but I don't follow all of his principals. I joke that I have Dave Ramsey on one shoulder and Robert Kiyosaki on the other.

All that I can say is that one of my Partners, Jimmy owed $70K in Student loan debt when he bought his first multi. He was able to pay off his loans quicker because of it.

[Ben Guttman]

@Frank Patalano great meeting you at Bunzzz last week! Awesome to see you back here!

[Frank Patalano]

Originally posted by @Ben Guttman:

@Frank Patalano great meeting you at Bunzzz last week! Awesome to see you back here!

 It was definitely a great networking event. Baltimore has a lot of nightlife.