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?

[Frank Patalano]

@Alex Verdugo

Stick to some conservative numbers but there is nothing wrong with buying now if the numbers work.

Another possibility is to partner with a more experienced person. Share the risk and the reward especially because if your credit issues.

[Mike Dymski]

Originally posted by @Frank Patalano:

@Mike Dymski

Fears a tough one overcome. I will tell you that everyone has fear even if they don't admit it. Robert Kiyosaki says that he still shakes a little bit at the closing table when he buys a property. One way to help overcome fears for knowledge. Another way is through experience. It's easier to buy property number 6 than to buy property number one.

I lost money on my first deal and I'm still doing it. Remember that risks are what make life memorable. Do you really want to play it safe your entire life? Think of the regrets.

You have to commit yourself to goals. Pick one goal even if it's fearful in each section of your life. I'm not saying to go skydiving or anything but perhaps just to go to a monthly real estate meaning. Look at one property a week. Make an offer on one property a month. It doesn't matter how low the offer is. If you get accepted than you were not low enough.

At the beginning of the year I set out with six goals and so far I've been pretty successful at five of them.

Incidentally, I was afraid of heights...still am a little.  So, I went skydiving...50 times.

"Life begins at the end of your comfort zone." -Neale Donald Walsch

[Anthony Wick]

@Frank Patalano I'm looking off market, MLS, LoopNet (insert laugh here). Everywhere. I have two realtors, in two different locations, looking specifically for me. And making it known to everybody and anybody what my criteria is. I did bid on a 5 plex recently. "Off" market. Only, two of us knew about it and bid on it. I will be interested to see what the other bidder bought it at. My numbers said one thing, the other bidder obviously had different numbers that worked for them. My pockets are not deep, and I am a W2 wage employee part time RE investor. Cash flow is a must, but value add is also what I am looking for. I can be patient as we do not actually take a salary from our RE investments.

[Frank Patalano]

Skydiving, are you joking? 

Originally posted by @Mike Dymski:

Originally posted by @Frank Patalano:

@Mike Dymski

Fears a tough one overcome. I will tell you that everyone has fear even if they don't admit it. Robert Kiyosaki says that he still shakes a little bit at the closing table when he buys a property. One way to help overcome fears for knowledge. Another way is through experience. It's easier to buy property number 6 than to buy property number one.

I lost money on my first deal and I'm still doing it. Remember that risks are what make life memorable. Do you really want to play it safe your entire life? Think of the regrets.

You have to commit yourself to goals. Pick one goal even if it's fearful in each section of your life. I'm not saying to go skydiving or anything but perhaps just to go to a monthly real estate meaning. Look at one property a week. Make an offer on one property a month. It doesn't matter how low the offer is. If you get accepted than you were not low enough.

At the beginning of the year I set out with six goals and so far I've been pretty successful at five of them.

Incidentally, I was afraid of heights...still am a little.  So, I went skydiving...50 times.

"Life begins at the end of your comfort zone." -Neale Donald Walsch

[Frank Patalano]

@Anthony Wick

So you are taking action. Just keep at it. Search for that needle in a haystack.

[Jalen Smith]

@Frank Patalano I'm completely new to real estate. I've self educated obsessively for the tester part of a few weeks. I've done nothing but scour for deals and analyzing how good of a potential deal it could be. There are REI meetups in Nashville, TN (where I reside) but I missed the most recent one. I want to make myself as beneficial as possible to seasoned investors I can partner with and learn from. My inexperience is the only thing stopping e at this point.

[Frank Patalano]

@Jalen Smith looking at properties online is cool and everything but get out there and actually look at them on site. If you have extra time look at as many problems as you can over the next month. That will build some experience as you are prepared to talk to seasoned investors.

[Aaron Dorley]

For me it is a mix of not having a set path I want to take because of fear and also capital

[Alexander Ball]

Right now, it's find a deal where the numbers work. Too many of them would immediately be bad deals with even a minor downturn in the market. My plan is to look at every potential property near me, make offers where the numbers make sense. If that doesn't work, I'll start looking into potentially going after foreclosures and doing a BRRRR. Or, I'll just be patient and save more. I think it's easier to get good deals on the more expensive properties since there's a bigger barrier entry. Or I'll look into partnering. We shall see.

[Sharissa P.]

@Frank Patalano I plan on house hacking what’s holding me back is fear of not being successful or my home becoming a financial burden rather than cash flow. Education is also a major part everyday I come across something I didn’t know and makes me think is this for you? As well as money not having enough for down payment and closing and not having money after all of it is done.

[Brandon Targ]

The main thing that is holding me back is strategy. I don't know if I want to start my real estate investing portfolio with a buy and hold, or if I want to put the time and effort into a flip.  It is really holding me back from starting down this path. 

[Stephen Brodman]

@Frank Patalano what's holding me back at this point in time from making my first deal is lack of capital. I'm looking to downsize from current large home on acreage to something more reasonable. I am married with our fourth child on the way and want to be careful with our first deal. My wife also has some student loans and a car payment we could make disappear with buying a smaller place. I bought our current home at the end of 2009 and it has appreciated quite well - approximately by 125% or so. We live in the Spokane/Coeur d'alene area and at least most of the deals on the MLS don't make much sense and they fly off the market so fast! I'm talking about duplexes which is what I'm interested in mostly. Current home value 425000 with 162000 in mortgage and HELOC debt and approx 50000 in student loans/car loan.

[Frank Patalano]

@Aaron Dorley

In order to get around that I would recommend networking. If you continue networking with other real estate people you will eventually find a path you want to take. Keep reading and educating as well.

[Frank Patalano]

@Alexander Ball

I see what you're saying. While I don't know exactly what you have going on perhaps you should start small then if you make a mistake it won't be as bad even in a downturn. The real way to get better is through experience. It's okay to fail once in awhile. Those small failures are learning opportunities and will be more valuable than any real estate program that you can buy.

[Frank Patalano]

@Sharissa P. House hacking is the probably the best way to get into multifamily investing. It will help you build so much experience for when you buy more properties in the future. You definitely need a place to live so instead of just renting at least you get to build equity into something. My partner Jimmy bought 14 unit and never paid a dime in mortgage payments. The rent's allowed him 2 live virtually free. That was a different time in the market but you should still be able to get discounted rent and build equity.

[Greg Baca]

I’m 23 years old and new to investing, I been reading a lot and educating myself. I have pretty good credit with little debt. Only thing holding me back is money. I have a decent job but haven’t had it for 2 years. So any advice would help.

[Frank Patalano]

@Brandon Targ

Sounds like you're putting too much pressure on yourself to find the perfect deal. Just go out there and make the best offer you can on the best deal you can find. If it's doable, just do it.

[Frank Patalano]

@Stephen Any Brodman it sounds like you're in an awesome position. You've built up a great amount of equity and have plenty of options compared to many other people. If you want to keep the house you're in you could also do a HELOC and use that as a down payment to invest. Do you love where you live now?

[Frank Patalano]

@Greg Baca

You are in a great position. If having a lack of money is your only problem I would be out there networking with larger and more experienced investors. Ask them, how can I help you? Do not ask them for anything else. Over time as you build those relationships you will gain experience and they made me let you in on a deal. Another way is to find a deal and partner on it or just wholesale and get a wholesale fee. Plenty of options some people have time, some people have money, and some people have experienced. Use what you have to its full advantage.

[Marsha F.]

Lack of capital :(

[Alexander Ball]

@Frank Patalano

So, would you recommend buying something even if it isn't a great deal?  I did buy my first house hack back in November and I learned a lot from that already.  I'm just reluctant to buy something where I could just be breaking even for a while when I could keep looking for a bit longer to see if I can get a deal I'm happy with.  If I take a year then that's obviously not ideal, but if I take a few more months I don't feel I have much to lose.  Any thoughts?

[Frank Patalano]

@Marsha Fils

The best way to get around a lack of capital is to partner with someone. Besides that, if you find a deal and you bring it to someone they will probably give you some sort of a referral for finding a deal for them.

[Frank Patalano]

@Alexander Ball

No. If you've already done a house hack than you're doing fine. I'm having a hard time finding deals as well right now. It's okay to wait for your numbers to work. I meant to buy a house hack if you owned nothing. You are building experience as we speak. Keep looking for that diamond in the rough.

[William S.]

@Frank Patalano

What's holding me back right now is my moving history. I've lived in four different cities in the past eight years. I do have some rentals, but am unsure where to go from here. Right now, I am stabilizing them. As far as buying more I don't know what to do yet. I have a team in Milwaukee, so I may keep buying there long term. "Staying local" doesn't make sense for me because I'm always on the move. Thoughts?

[Mike Roy]

@Frank Patalano - Good conversation starter, so let me give you my vote!

I think fear of failure is what holds back a lot of new investors - that they'll lose money, that they'll prove the nay-sayers right, that they'll validate their own limiting beliefs.  I think that identifying the fear is the easy part, but overcoming it is where you can add value to your clients.

For me, I try to overcome my own fears through education and motivation.  The more I know about an investment - the down side, the upside, the opportunity cost - the more comfortable I will be in making a decision.  For motivation, I always remind myself of the "why."

As you're working with new investors, I would suggest trying to be that resource that bridges the education gap and keeps them focused on their big picture goals, and I think that could help resolve a lot of inaction into action.