Why you SHOULDN'T invest in Real Estate...

Real Estate Investing isn’t for everyone, and it’s important that we all take a realistic look at not only what makes it a good investment, but also why some people may chose to look elsewhere - enjoy! Add me on Snapchat/Instagram: GPStephan

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One of the biggest reasons I think a lot of people get excited about real estate is that they believe there’s a LOT of money to be made with minimal effort. If you’re not prepared to put in a LOT of work upfront, real estate investing isn’t for you. What most people will see happen is that they’ll invest a substantial amount of time and money buying the right deal, and then once they buy that deal, it’s less exciting than they thought. Real estate investing is often something you set up now, where the benefits and payoff comes years later.

Second, you should NOT invest in real estate if you don’t understand how it work. This isn’t limited to just real estate, this is ANYTHING you invest in…stocks, cryptocurrency, businesses, it DOESN’T MATTER. If you don’t fully understand it, don’t invest in it. Largely, the people who lose money in real estate simply don’t understand values, don’t know what they’re doing, over leverage themselves, and become emotional in the event the market goes down…or get too greedy and hold out when they want to sell.

Third, you should NOT invest in real estate if it’s meant to be a short term play. I’ll be the first to admit, this doesn’t apply to everyone in every circumstance…and people could disagree with me and they wouldn’t be wrong. But chances are, if you’re learning about real estate investing, you should NOT invest in real estate for immediate short term profit. The reality is that we don’t know if you will absolutely be profitable within 1-5 years to a point where it makes sense to sell. A lot can happen in the market in the short term, and if you go in with a short term outlook, there are so many variables with could disrupt your plan. Long term holding can overcome a lot of other obstacles along the way.

Fourth, don’t invest in real estate if you don’t have the TIME to devote to it. It’s NOT a passive investment without a substantial amount of work from the very beginning. If you don’t have the time to dedicate to this, either factor in the cost of a property manager or don’t invest. The last thing you need is to plunk down a significant chunk of money on something that you can’t give the attention it needs to make it worth it. This will be a time intensive process to get it streamlined to the point where you won’t need to spend much time on it..

Finally, don’t invest in real estate if you don’t like real estate. I know this doesn’t apply to most of you, but you’d be surprised that some people JUST DON’T LIKE REAL ESTATE. They don’t like tenants, they don’t like dealing with people, they don’t like the responsibility, they don’t want to be be tied down to a location …instead, they’d rather make money from a laptop on the beach without having to deal with anyone. And there’s nothing wrong with that, but it should go without saying - you should only invest in real estate if you actually have an interest in real estate. There are a lot of nuances when it comes to looking at properties, areas, architecture, styles, and trends that if you just aren’t interested in it, you won’t give it the attention it really needs to be profitable. Things will fall through the cracks, they don’t be done as well as they could be, and that means less money in your pocket.

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[oKevn]

Why you shouldn’t invest in real estate... so there’s more opportunities for me 😈 - Stephan

[DianasHandler]

I love these “different point of view” videos. Sometimes channels get bogged down only talking about the positive and it’s good to hear both sides.

[lilsnow]

"The microwave makes a beeping sound when the food is ready" lol

[TheLifeFormulaa]

Well spoken! I feel that when you are young, it makes more sense to work on a business to get the laptop lifestyle but once you get older you might want to start thinking about real estate.

[ZXC_ZXC]

Then you forgot to mention the disaster of having bad tenants damaging your property. In my area I realized that detached houses make horrible investments. Tenants sign a lease for 4 people living there (husband/wife and 2 kids) but when they leave you realize that 10 people were actually living there causing the damage. I found that townhomes make the best rentals because tenants do not want to maintain a yard. I got more money renting a townhouse I bought in 2012 than a larger detached house.

[InvestingBookSummaries]

The lack of effort I need to put into *holding* stocks is why I'll keep piling money there instead.

[lenahanconor]

About to buy my first multi family, that call I did with you in the summer helped a ton!

[NotShowingOff]

I feel like if you were to talk about opening up a generic small business like Amway or creating your own clothing line, or a software company, most ppl would shy away because they will say it’s risky and too much work, but with real estate, their minds change, even though this is still a small business like any other and still has a lot of work and a lot of risk. Go figure.

[ILUVGOLF]

This is freaking GOLD!!!! Thank you, Graham! This is 100% value. I want to purchase a home to rent out but I don't want to deal with problems. I considered purchasing a rental about a year ago - instead I challenged myself to work harder on my channel to make that money that I'd be receiving from a rental. It worked! Thanks for doing this, dude!

[robert_iacob]

Very well spoken Graham, your videos keep getting better and better 🚀

[EricJA]

Real Estate can be very confusing and frustrating without the right system or mentor showing you the path but by no means will it be easy.

[humdrum]

It's a lot of work, but its a more rewarding and energizing kind of work than punching a clock at someone else business.

[james]

I love it when people say, "I'm just waiting for the market to tank so I can load up." The reason the market tanks is because nobody wants to buy and everybody wants to sell. And, guess what, you'll be in the latter group, too, because it will be SO OBVIOUS that the only direction from now until the end of time is DOWN.

I did buy in 2010 and I know exactly how hard it is to "buy at the bottom.". I still own the property and have made a nice profit on paper. Everybody thought I was crazy for buying at the time, including the seller who thought he was dumping a turkey on me and basically taking advantage of me. It made NO SENSE to buy then and EVERYBODY knew it. The media was full of stories about how homes were a lousy investment, they cost you a ton, you can't sell them, times have changed, the milllenials don't want to own homes becuase they just want to play Call of Duty, blah blah blah. And you think you will be different, you will have that iron confidence when it makes you look the fool to buy and you're just throwing your money away because the market obviously has another 50% left to fall and renting makes so much sense? Sure, and you'll only buy stocks at the bottom, too. I know, I hear it all the time. Funny how you never hear stories about people buying at the top - when everyone, in fact, is buying, because that's what makes a top..

[nachos]

So basically: "Don't invest in real estate if you don't have common sense"?

[Kevin-gqkj]

Can you make an in depth video on what factors to look out for before buying a property and what exactly we should be researching and also the websites that you go to for that research

[PositiveInvesting]

Great alternative view. I personally have not considered real estate investing due to the lack of flexibility - I can't sell the property the second I want to. And that scares me. With stocks, i have that flexibility.

To each their own!

[InvestingRobinhoodInvestor]

Don't invest in real estate if you are not familiar or if you don't like it

[georgecastro]

Young man that is the best video you have shown us on YouTube! Excellent job concerning real estate investing!👍👍

[Roxas]

Thank you so much for all your vids you and Kevin are the best. So many scammers teaching real estate I’m so happy I found your channel. You taught me an incredible amount in the past week. Thank you for the knowledge 🙏🏾

[RosGuys]

Angry tenant: -The microwave makes a beeping sound when the food is ready.
I love you man