July 7, 2015 in Investing In Real Estate
Let’s face it.
Just the thought of starting something new can make us find a whole lot of reasons and excuses for why we need to wait. Getting started in real estate investing is no different starting anything new. We all have a tendency to drag our feet when we are facing the unknown.
How about these reasons for not getting started? Do any of them sound familiar?
- I don’t know whether I need to set up an LLC or a Corporation
- I don’t have a website yet
- I need business cards before I start
- Once I get new office furniture I’ll be ready to go
- When I get back from vacation next month the time will be right
- I need to get another book, attend another seminar or ……
It’s really easy to come up with reasons to wait, but I have come to the conclusion that there are several main things that commonly hold new investors back.
A Lack of Confidence
It’s so easy to focus on what we “don’t know” that we don’t take any action at all. The simple fact is that we will never know everything. Generally a lack of confidence is due to a lack of education and a lack of practical experience. So how do you overcome that?
The Experience Factor
There is only one way to move past your lack of experience and that is by diving in and facing the unknown. As Nike says, “Just do it”. If you feel like you don’t know what to say to sellers, find a script and use that until you get comfortable having those conversations.
Ultimately the only way to get good at talking to sellers is to actually talk to them. Besides, look at it this way; they are on the other end of the phone so they can’t actually see you. It’s much easier to make your mistakes with someone on the telephone than when you meet them in person.
When it comes time to meet someone at their home my advice is to “fake it until you make it”. If you appear confident and experienced no one will be the wiser. In almost 20 years of investing, I have never had anyone ask me how long I have been investing. Now when you have a few years under your belt, you can use this experience to your advantage.
Get Some Education
There are many ways to get the education that you need and lot of them are free or very low cost. You can find an endless supply books and tapes that you can invest in or borrow from the public library. (You do remember the library right?)
There are also countless online websites that offer quality education free. The cost of learning from these websites is just your time. I will put a word of caution here; be careful who you follow. There are a lot of “pretenders” out there.
Join Your Local REIA
My advice is to be like a sponge in the beginning and soak up everything you can. Try to get a feel for the types of real estate investing that appeal to you. Join your local REIA group (Real Estate Investing Association). Most major cities have one and most of them hold regular monthly meetings. There are many benefits to joining a REIA.
Not only do these groups provide endless educational opportunities, but you can learn from the experiences of the members (the good, bad and the ugly). You will find that in most cases these folks will be happy to mentor you and help you succeed.
Another benefit that is often overlooked in REIA’s has to do with money. Your REIA is where you will find private lenders. That’s right. A lot of members of those groups quietly loan money to other investors. Other investors will even provide seller financing when you buy one of their deals. This is a great way to get started when you are new and you can’t get a bank loan.
Don’t Hide Behind Your Need for Education
This is another common problem. Folks get stuck in the learning phase and don’t take any action at all.
They think they need to know one more thing before getting started. Or they say they will finally take the leap after that seminar at the end of the month. I personally know folks that have come to my REIA for decades and have never bought a single property.
Start with what you do know and move forward. Take some action today. It doesn’t have to be perfect.
We all find ourselves deep in information overload at one time or another. But this is a particularly troublesome problem for new real estate investors. Each time a “shiny new product or course” comes along, we begin to question the path we have chosen. We want to chase this latest money making strategy.
Don’t do that. Keep it simple and stay on your path.
The first step is to decide what you want to do. Which investing strategy will you start with?
Maybe it’s wholesaling or fix and flip. Once you nail that piece of the puzzle then take that great big “elephant” and break it down into bite sized pieces that turn into manageable tasks. Your first step will most likely be figuring out some marketing strategies for getting leads in the door. Once you your phone is ringing, you will be on your way.
If you tackle each new challenge head on your fear will just fade away.
Stay on Top of what’s Going On in Real Estate
One of my favorite sources for staying on top of what’s going on in the world of real estate investing is blogs.
There are so many great blogs out there and many of them are written by people just like you and me that are chronicling their journey as a real estate investor. You will find folks with all levels of experience so don’t be afraid to comment and ask questions as you read the posts.
Do you have any questions for me? If so you can leave them in the comments section. Happy investing!
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