On September 27th of 2022 I bought my first rental property. Here are four things I have learned since then:
1. No matter how much information you read, listen to, or talk about with other investors, you will not understand the reality of the system until you have fully immersed yourself into your own property and gained your own personal experience.
Before buying my property I had been listening to, watching, and reading anything and everything I could get my hands on regarding any kind of investing, business building, self development, and real estate. I started at absolute zero in 2020 when I first decided to make an effort to better my life. I knew nothing about real estate, so I started educating myself as much as I could for the next two years until I felt comfortable and contacted a real estate agent.
I quickly saw for myself how much different gathering the information is from implementing it in your life. I had heard on podcasts and in books and videos about this, but there truly is no substitute for the real life experience.
2. Going over your budget and seeing that you can make it work is a lot different than living out the budget and pushing through the project.
I looked at my spending and saw that I could make the numbers work for me to invest in a property. I figured I had already been living on a budget, so why would it be much different to switch up where I am putting some things in order to invest in myself and get a better life for my family?
It is a lot different. There were plenty of expenses that I did not, or could not have foreseen. I knew this was going to happen from all of the content I had consumed, but I had no idea how many there were going to be, or how important they would be to fix immediately.
For a little more context, the house I bought was built in 1910, and within these first six months we have had flooring issues (the kitchen floor almost became the basement floor), pest issues, furnace problems, electrical issues, contractor problems, shingles blown off the roof, and more.
If I had to start all over again, I would look to have a larger cash fund to begin the project with. The process would be a lot smoother and less stressful.
3. Knowing how to renovate is just as important as knowing your numbers (if renovating falls under your strategy and you don't have the funds for "who not how")
When I first decided that the best investments for me were LTRs (long term rentals), I was terrified of all the laws and paperwork I would have to learn how to use and work with. I had done nothing close to this before in my life and the thought of messing up and getting sued by a tenant or fined by the government terrified me (it still is scary).
What I neglected to study was how to take on DIY projects. I had virtually no experience with renovating besides changing a few door handles and some painting. I had heard of the “who not how” strategy, but I quickly learned that “who not how” is very expensive and quite difficult to utilize when you only make 15$ an hour.
I should have been studying how to do various projects while also learning all of the paper, legal, and business sides of things as well. I am lucky to have support from local investors, Biggerpockets, and from family, but it was definitely a mistake to not teach myself these skills before jumping in.
And always remember: never be afraid to ask for help.
4. It’s not as scary as you think it will be.
I was terrified when I first bought this property. I have never been a super confident person willing to expose myself to potential risk. I had always stayed in my comfort zone and rode along through life there. But as the famous quote goes “The problem with the comfort zone is that nothing grows there.”
I needed to force myself to step forward if I ever wanted to go anywhere in life. It was terrifying taking those first few steps. Buying the property, telling the tenant I was raising his rent, signing a new lease with the tenant, these were all valid things I had to deal with, but in the end they were not as scary as I thought they would be. As time goes on and I gain more confidence and familiarity with the work, the more I can see how things should only go up from here.
What do you think? Do you agree or disagree? Are these good lessons and do you have any more to share? Let me know!
P.S. I am in Newark Ohio. If you are also investing there or nearby lets get in touch!
