3 Obstacles You’ll Face in Real Estate Investing

I hate to break it to you, but real estate investing isn’t sunshine and rainbow ponies all the time. As an investor, you’ll face plenty of challenges, big and small, and you’ll have to learn to work through them if you want to find long term success. One of the best ways to overcome these obstacles is to head them off before they even start, or at least before they become huge problems. You can do this by identifying some of the most common challenges in advance, and then taking preventative steps to keep them from becoming big issues. Lucky for you, I’ve put together a list of 3 of the obstacles you’re virtually guaranteed to face as a real estate investor, along with how you can overcome them.

Vacancy

A property without a tenant is a property that’s losing money every single day that it remains unoccupied. That’s why vacancy is such a dirty word among investors. It’s also one of the biggest concerns you’ll have as a property owner, and it’s up to you to ensure that it doesn’t become a huge obstacle between you and your profits.

But how do you do this? Well, there are several steps you can take. For starters, once you’ve found good tenants, you want to keep them happy. Maintain your property well, be responsive to their needs, and basically just treat them how you would want to be treated. If you know a vacancy is imminent, don’t delay in preparing the property for new tenants and marketing it through a variety of channels so it reaches the most people. The sooner you get a new lease signed, the less money you’ll miss out on.

Funding Challenges

Money, or lack thereof, is also an obstacle that many investors must deal with, especially when they’re first getting started. I frequently hear from would-be investors who have found the perfect property, but they don’t have enough saved up for a down payment, or they can’t get financing, or the numbers just aren’t adding up for them. When this happens, my advice is always the same: take a step back, reevaluate the situation from an objective perspective, and consider all your options (including the ones you hadn’t thought of before). If nothing rises to the surface, you may need a new approach, or at least some time to start saving up some cash.

Along the same line are funding challenges that arise post-purchase. These obstacles usually stem from not having a substantial enough emergency fund to cover unexpected repairs or other costs. The solution here? Don’t jump on a property until you have some backup cash, because you WILL be dealing with surprise expenses.

Not Being Able to Find the Right Deal

Okay, so let’s say you DO have the money, and funding challenges aren’t your obstacle. Instead, you can’t find your ideal investment property! Maybe you live in an area where the inventory is low, or maybe the competition is crazy high. Either way, you’re not finding a property and you feel like you’re just spinning your wheels.

The best way to overcome this obstacle is to be more open-minded and try a few new approaches. If you’re in a market that’s understocked or just not performing well, then look elsewhere. There’s no rule that says you must invest in the market in which you live, so check out some areas that are performing well and do have a lot to offer. Technology has made it fairly simple for investors to explore outside their own territory, so take advantage of that!

Now, if you’re already looking in a great area but still having no luck finding the perfect house, perhaps the answer lies in expanding your search methods. Are you exploring all the avenues? MLS, Craigslist, referrals from others in the industry, even just getting out and driving around in your desired locale - all of these are good ways to find potential properties, and you should be using at least a few different methods. If you’re not, you’re severely limiting yourself on possible opportunities.

Obstacles are inherent in real estate investment, but you CAN overcome them. Taking steps to prevent and minimize them is one of the best things you can do for yourself as an investor, and it will save you time and money now and in the future.