Video Chapters
00:00 Intro
00:21 Myth #3: Real estate investing is risk-free
01:09 Myth #2: Tenants will call you day and night, or they’ll tear your property apart.
02:10 Myth #1: You need a lot of money to invest in real estate.

Are you considering real estate as an investment opportunity? Before you dive in, it’s crucial to separate fact from fiction. Real estate investing is often romanticized as a guaranteed path to wealth, but like any investment, it comes with its own set of myths and misconceptions. Let’s debunk some of the most common ones, to get to THE TOP Real Estate Investing Misconception.

Myth #3: Real estate investing is risk-free.

Reality: Like any investment, real estate comes with its own set of risks. From market volatility to unexpected expenses like repairs or vacancies, investors must be prepared to handle potential challenges. Conducting thorough due diligence, investing in quality properties, and implementing risk management strategies are essential steps to mitigate these risks. Additionally, maintaining liquidity and having a contingency plan in place can help investors weather unforeseen circumstances and protect their investments. And this is built in with lenders – when you borrow money for an investment property, they will often want to see cash reserves that equal 6 months of your payments for that loan.

Myth #2: Tenants will call you day and night, or they’ll tear your property apart.

Reality: Property maintenance and tenant issues boil down to poor or insufficient management. Successful investors understand the importance of being either hands-on or implementing an effective property management partner, and having proper communication with tenants, setting expectations and a workflow that doesn’t require you to pick up the phone during your kids’ soccer game, or in the middle of the night. So again, finding partners is important, especially if you want to do do less of the “hands on” work of day to day property management, but at minimum setting expectations that will dictate who a tenant should call if a dishwasher is leaking in the middle of the night. Also, proper tenant screening will help make sure that you end up with someone that is going to take care of the property.

Myth #1: You need a lot of money to invest in real estate.

Reality: While having substantial capital can provide advantages, such as faster growth or access to better properties, it’s not a prerequisite for getting started. Most of the savvy investors I know are always looking for alternative financing in every deal. The least upfront cost. Various investment avenues, including partnerships with other investors and creative financing options like seller financing, or “subject to” financing make it possible to invest with minimal funds. With careful planning and research, even small investors can find opportunities in the real estate market.

Real estate investing is both fun and challenging, so it’s essential to approach it with a clear understanding of the realities involved. Remember, knowledge is power in this world, so arm yourself with information so you can pursue opportunities with confidence. Mash that like, I’ll see you in the next one.