Real Life of a RE investor/wannabe

[Sheila Villacampa]

I selected this forum because I want my story to be a successful one. But I doubt it.. And really today I feel like I want to give up. In 2003, I came to the US through a work visa. Apart from job, I dreamed of establishing passive income mainly to help my family. I thought of doing it through RE. I worked 3 jobs, established my credit history saved enough down payment and got my first condo home in 2005. A book gave me the idea that if live in it for a few years, rent it out and move on to the next is the way to go about acquiring passive income. Then I repeated it in 2006, 2009, all condos and with loans. Doing the same working 2-3 jobs at one time. I lived in one and the others are rentals with 200-300 negative cash flows because of bad timing. But I hang on to it because I did not know any better and certainly did not know biggerpockets. And also because of hard work and I was single, thus able to do so. Life was beautiful!! I told myself. I have a goal. I was busy with work. And enjoying life as a single happy bachelorette in Chicago. Fast forward to 2014, I have acquired 2 other properties--moving forward towards my goal. But along the way I also have now 2 wonderful children. I realized I cannot sustain 2-3 jobs when I have kids. But my main detractor from dream is my husband who does not believe in RE, and in every turn discourage me from it. Today is one of the worst, because I'm at the tailend of my maternity leave and my rainy day funds are dry,with no moral support from my partner, who literally have said in several occasions including today that he will not lift a finger. I just want to quit real estate. I would like to requests experts opinion. Is it possible to succeed in this despite of approx 180k loans, 2 properties in negative cash flow, tax lien that needed to be redeemed from my residence, 2 properties that need rehab and 2 kids+1 to support? Or is this a nightmare that I need to awaken? I want to be a RE Investor with the capital I and not just a wannabe but maybe I dug too badly due to ignorance. Please let me know but be kind, I do hear a lot of criticisms from my hubby.

[Eric Bowlin]

Everyone makes investment mistakes. Look at each property as a "Sunk Cost". You cannot and will never recover the money you have already lost. You must decide if you will make more money by keeping those properties with negative cash-flow, or selling them and using any proceeds to buy better, positive cash-flowing properties. You should really look up and understand the concept of a sunk cost because the vast majority of people make emotional decisions about their lost time or money. The time and effort you put into these properties is completely unrelated to what your future returns will be.

The textbook example is a long 3 hour movie. After 30 minutes you realize it is a TERRIBLE movie. Do you sit and watch the rest of it because you already spent $15 and an hour of your life..or do you leave? The answer would be to leave...the time and money won't come back but you can still use your next couple hours to do something fun.

As far as your family life... Emotional support is important but I wouldn't let it stop me. You came from another country, alone, and through sheer force of will accomplished something that most people never could. It would be nice if we could forge a path and have someone there by our side every step of the way...but If you know you are right, you just have to take the lead and drag everyone else with you.

Most people are born and raised to crowd-think. "if real estate was easy, everyone would do it"... "you'll lose everything because it's impossible to evict bad tenants"..."Real estate is too risky..You should just get a good job"... "I could invest in real estate but I don't want to deal with the hassle"...a thousand excuses to not be successful. The same excuses regurgitated from someone else for another situation. Don't fall into their negative thoughts. Help them understand why they need to listen to you. Perhaps have him read some Robert Kiyosaki.