BiggerPockets Real Estate Podcast - When’s the Right Time to Start Investing? (Age, Money, Lifestyle)

Episode Date: May 21, 2025

When is the right time to invest in real estate? We’ve all asked ourselves this, and if you’ve been thinking about buying rentals, you probably have, too. Whether you’re 20 or 50, have a little money or a lot, that first real estate deal can seem so...scary. You’ve never done this before, and things can (and will) go wrong, so how do you know you’re ready? Have you read enough books, saved enough for emergencies, or looked at enough houses? We’ve got three investors who all started in different positions to help get you an answer.  Dave started investing right after college when he was waiting tables and had barely any money in the bank. Henry began to invest well into his working career, but with a family to take care of in the near future, he had to invest differently. On the other hand, Jonathan Greene was born into real estate, with an investor father who taught him the ropes from childhood. Each expert started from a different place, but they all agree on when it makes sense to invest. How much money do you need to make? How much free time should you set aside? What should your bank account look like? Do you need to know how to renovate and repair? Each investor will share where they think you should be to successfully invest in real estate. Good news—you might already be there!  In This Episode We Cover The right age to invest in real estate (and can you ever be too young/old?) How much money you should have in case your first deal goes wrong  Growing your confidence to buy and how many houses you should view before bidding  The time it takes to invest in real estate on the side (do you have the schedule for it?) Financial signs that you’re NOT ready to buy a rental (and how to fix your finances) Is it too late to invest with high home prices and interest rates?  And So Much More! Check out more resources from this show on ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠BiggerPockets.com⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ and ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://www.biggerpockets.com/blog/real-estate-1124 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠[e-mail]⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. Learn more about your ad choices. Visit megaphone.fm/adchoices

When is the right time to start investing in real estate? Are you too young? Are you too old? Do you have enough money? Did you already miss the market timing and all the good deals are gone? I totally get it. Investing in a rental property is a huge decision for your financial future. But also for your lifestyle. You want to make sure you're in the right place, not just from a financial perspective, but for all those other factors in your life as well.

Today, we're talking about this with two other expert investors. What's up everyone? I'm Dave Meyer, head of real estate investing at Bigger Pockets, and I've been buying rental properties for more than 15 years. Today on the show, we're talking about when to invest in real estate. We're going to get into when is the best age to start. When you have enough money in the bank to take down your first property, how your lifestyle at different points might affect whether you want to start investing. And if there are times in the economic cycle that are better to dive in and whether or not there's times that you should probably hold out. So for this conversation, I've brought in two great investors who have wrestled with

all of these questions themselves. We've got Henry Washington here. Hey, what's up, buddy? Glad to be here. Thank you. And we also have Jonathan Green, who's been on the show several times. He's an agent and investor based in New Jersey. He's been one of the most prolific posters in Bigger Pockets forums, history, and he also hosts his own podcast, Zen and the Art of Real Estate Investing. Jonathan, thanks for joining us. Thanks, Dave. Henry, good to be with you guys. Let's start our conversation about when to invest, talking about age and what the right

time to invest is because it seems like every social media influencer is like 18 years old now, and everyone's talking about how I have to do it immediately out of like middle school. Property pros. Yeah, exactly. So Jonathan, you sort of like grew up in real estate, right? I remember that about your story. So do you recommend to people starting as soon as they can? I think it depends what type of mentorship you have.

You know, I was fortunate because my dad literally would not stop talking about real estate from the time I was a baby on. Like, it was just real estate money, real estate money, dirty joke. Real estate money, real estate money. So that was fortunate. Wait, was I your dad? Yeah. Maybe. I mean, this show is going off.

the rails. But I mean, like, you know, you can't fault people for not investing at 18 if they don't have the right background because then I think they will look for that, you know, TikTok influencer instead. So I think it's really about when you feel confident and how you get to that confidence level. And a lot of that is who you surround yourself with, not just what you watch, because what you watch is one thing, but then what makes you take action is another. Yeah, that's that's very good advice. And you are lucky. I think very few people have that, but being able to get all that inspiration and advice about real estate while hearing dirty jokes. I mean, it just sounds like the absolute ideal child.

I mean, Henry is a great dad. Well, Henry, you know, despite raising Jonathan, you started a little bit later in your life, right? But not that late. Yeah, 37, I believe. Do you think when you started was ideal or do you think there is a better time? When I started was ideal for me because I think investing, you need to have a certain level of maturity, right? Because it, I mean, it's a big deal. And I think you can start young.

But I think the question is less about age and more about financial stability or financial readiness. I don't think you're any, but I don't think any college student unless their parents are giving them money is financially stable. but some are more ready than others to invest because some may have some amount of savings. Some may be from a family who's going to help them, you know, buy that first property, right? Everybody's financial position and situation is different. Do I wish I would have bought a duplex and house hacked as a college student? Heck yeah. Yeah.

Of course. But was I in a position to do that when I was in college? I probably wasn't. If you can start young, you should. But I think you have to look long and hard about what does can and ready mean for you. Like, you've already got to go to school, which is hard enough. You don't want to put yourself into a position where you're defaulting on a property because you, you know, it didn't go like you thought.

You're not running out the unit. You're not getting the rent you thought. Your tenants are destroying your place and you're trying to cover this expensive mortgage and go to school. Like, if it goes well, it's great. But it cannot go well. And are you prepared for that? That's a really good way of putting it.

I think of course everyone's going to say, yeah, just invest as early as possible because the benefit of compounding is real. But also, the younger you invest, the odds of you messing up, I think are actually a bit higher. Yeah, I was stupid. I should not have owned a property. I should never have owned a property at that time. But I think Henry made a good point about maturity because even if you're financially ready, if you're immature, you're not going to do well with the money. So it's not just about what you know about real estate. It's what you know about money.

And if you're self-aware of what you're going to do with your money. Do you think that maturity then requires, Jonathan, some amount of financial literacy and education before actually pulling the trigger? For sure. I mean, you know, we always talk about real estate, but money is really the sidecar to what moves it. We need the money to get there. So if you look at kind of more like what we were saying in the beginning, what we see

on social media and more fire movement, it's like, like trying to get people to go quicker, but you want to build a foundation. If you don't have a foundation, you're just a house of cards. And that's why so many people crumble and give up. I find that the people who have become successful over time were ready. Like Henry said, it doesn't matter if they were 20, 30. They built enough runways so that they knew, hey, I can do this. And if it doesn't go well, I'm going to be okay. I think that's what's really important. Like, because there's inherent some risk in all real estate. You know, we're lucky to live in America where most things are going to appreciate, but you can make bad buys. But as long as you know,

if this doesn't go well, I'm not going to collapse my life and go bankrupt and ruin my finances for seven years. I think that's hugely important. I'm so glad you said that because a lot of people, I feel, get caught up in this idea of risk tolerance. And they're like, oh, I'm comfortable gambling. I'm comfortable taking risk. I'm in. Until they get punched in a mouth. There's a difference between risk tolerance and what I think Jonathan's talking about, which is what I would call risk capacity, which is like, are you in a position to be able to weather the storm that's appropriate to your risk? And for a lot of people, you know, that means having maybe a stable job. That's something I cared about before I started making an investment or having an emergency fund or, you know, if you have

a significant other who has a stable job and health care and benefits. Like those are the types of things that allow you to take risk to go out there. I think about my own self, my own risk capacity. I started when I was, I guess, 23. And like, I just, I had risk capacity because I had nothing to lose. I had nothing, you know? And so, like, I do think there's something to that that, like, my time was worth nothing. Like, it was either playing video games or, like, go out and invest in real estate. Because, like, I wasn't giving anything up, you know, by doing it. And so I think there is some element of that, like when you are really young, that you have less to wager in a way where you can just kind of hustle. But I think for, you know, if you're starting, you know, a little

bit later, if you have a family or significant other, you really do need to put those other things in place before you start just investing. You read my mind because I was going to go to that same place. But I think being more mature and having something to lose or something to mess up should force you to be more cautious. And I remember when I started investing, with my limited knowledge of investing, I still made sure that what I was buying, like if I had to get out of it, I could get out of it and even make money. I wasn't going to buy something that I felt like I couldn't just get myself out of that situation because I had too much at stake. And it forced me to research to the point where I felt comfortable enough. And had I not had something to lose, I probably would have

just jumped off the cliff and bought something. And, you know, he knows. Right. Yeah. Yeah. I think, I think a lot of people, especially now with technology being so prevalent, they're suffering from not getting enough reps. So they don't really have the confidence. So when they get the FOMO, they just transact. But like, you know, like someone that says, oh, I looked at 10 properties this week. And I asked, well, how many did you actually look at? And they say zero. It's like, you just don't have the experience to be buying, I, of course, was overfortunate, walked hundreds and hundreds of properties before I was even 18. That's lucky for me. I don't think people can accumulate that number of looks, but you need to get a lot of looks so you can really feel more comfortable with knowing what's

in a basement or understanding what's in an attic. We're saying like risk tolerance and risk adjustment, but it really comes from how much you know and who you're working with. If you work with a baby agent and you don't know a lot, you know, how protected are you? You know, you going because look, real estate agents are great. I am one. We all know a million of them, but your regular real estate agent isn't savvy with investors. So they don't really understand what a new house hacker is doing. But the ones that do can really help work together and teach along the way. And I think, you know, both of those are important to going and picking the right time like you guys were saying. Hey, so I know people say real estate investing is passive,

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Baselane is giving bigger pockets listeners an exclusive $100 bonus when you sign up at baselane.com slash BP. The other thing I think Jonathan sort of that you had mentioned earlier, it's just like seeing these people on Instagram is what I would think, a false sense of confidence. People go out and they're talking about, oh, I just bought this deal and they're, you know, showing off all these amazing parts of their lifestyle. I think a healthy fear of the investments that you make is super important. I'm scared every deal I do. I still get scared when I put a property. Every time, right?

You're like, oh, why did I do that? Like, I'm so excited that day. And then the next morning, I'm like, what did I do? Yes, yes. I literally had a deal earlier in the year where I made the offer and the lady said yes and I went, but your experience, so the thing though, the thing with the brand new person who doesn't have the reps, when they get that, oh man, feeling like they should get it because they start going through every scenario. Did I bid too much?

We know we didn't fit too much. We know the values. But the new person immediately, that's why so many deals fail for new investors and then create havoc in the relationship with realtors. because they really do. They get the oh moment, but they have no idea. If maybe there are 100,000 too high, they just don't know because they're not advised and don't have the confidence. I remember the first off market offer I made on a property.

And boy, I'm glad they said no. Yeah. You offered too high. Way too much. Way too much. It was way too far out of town. I offered way too much. And my inexperience just, it could have really bit me in the butt had they, well,

had they said yes, I'm sure nobody would have gave me money for that deal because they'd have been like, no, we're not financing that. There's some checks of balances. But the inexperience will show itself, right? Like, so it truly does matter. I mean, I wonder what the right amount of reps is. Like, what is the right balance if you had to come up with that? Because I think what we're, what we're realizing here is that it's not about age.

It's about coming up with the right balance of risk tolerance, you know, financial literacy and reps. Like, Jonathan, do you have a rule of thumb or estimate for the audience of what they should expect? If you're buying single family, you know, I think you should see at least 20. Like, I would be no less than 20. Just because, you know, if you're in a basement area, that's where all the problems are, the foundation, walking the outside. You know, and people who are too new that they don't even want to get an agent, just go to open house on the dumps in the area if you're looking to flip. You know, no one's preventing you. Sure, you're going to get on a lot of realtors list.

But that's why I think a lot of investors should have their license, not so they can transact and do their, like, represent themselves because like you don't want as a lawyer to represent yourself. But just so you can go see every dump that comes on the market. It's so important to just be able, you know, Henry, you have a great agent. You can call them and say, hey, you know, let me see this. But a lot of people don't. So I think you got to use open houses, you know, because you can just, you could get like six on a weekend. That's six reps already. You're ahead of like half the market.

I was actually doing that this weekend. I was just going for reps to learn my new market. Yeah, that's great. Because I just found something that was great. But I was not intending even to do that. I was just, I went from stuff that was 500 grand. I went to stuff that was $1.5 million. That was stabilized, stuff that was in the worst possible shape.

Some were ADU development opportunities. Just go see them. And like, you'll get a sense of what makes sense to you. And I think, like, you get a feel for value. And I don't know how else to describe that. are important, but like when you do it enough, you can feel what the value is and if you're getting a good deal or not. Yeah. I would say I probably didn't feel comfortable walking a house on my own and estimating a rehab probably for six months into me looking at houses. And that's still

like a loose level of comfortability. I still can't do that. But I don't really flip. So I'm not like a rehab person. I can, but I still always think I'm missing something. So I think the more experience you get, like we're you know people like henry i like we're putting in like you know there's overage i know that i need like 15k for stuff behind the walls and stuff that's going to come and new people don't and one thing we were talking about before that i think is important like just having enough money but it's also having enough knowledge to know like wait i need reserves there's so many people who are like i can afford 200 so i'm going to spend 200 and then you're like but wait wait you have to do repairs or you're buying a multifamily and you have tenants you have to do upkeep like

reserves are the thing. So when people say, oh, you know, I have 100 to burn, you don't have 100, minus 15 percent, keep that for reserves and make sure that you're safe because that's what boxes people out, like Henry said in the beginning. You're just, when you push yourself to the limit, you're just making it impossible for you to succeed. Well, we've talked a lot about when the right time to invest is about risk capacity. Now, we've hit a little bit on financial literacy, getting your reps in. But I also want to talk about lifestyle, because this is sort of a really important part of being a real estate investor is like how it fits into your greater life and your family and your other aspirations and hobbies. We're going to get to that right after

this quick break. We'll be right back. Do you ever notice how every passive investment somehow turns into a very active lifestyle, active spreadsheets, active phone calls, active stress? Here's a better question. What if you could buy brand new construction homes, 10% below market value in the best markets across the country without making real estate your second job. That's exactly what rent to retirement does. They're a full service, turnkey investment company, handling everything for you. In some cases, investors get 50 to 75% of their down payment back at closing, plus interest rates as low as 3.75%. They've partnered with Bigger Pockets for over a decade, helping thousands invest smarter. If you want to do the same, visit BiggerPockets.com slash retirement to learn more.

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The job of a property manager is protecting and growing your operating income and earning your trust while they do it. And that comes down to three numbers, occupancy, delinquency, and net promoter score. If those numbers slip, your income slips and your trust slips too. And most PMs don't hold themselves to performance standards. They focus on activity, not outcome. Mind is different. They obsess over the metrics that actually grow your cash flow. Go to mine.co slash show me to see how mine performs and get a month of management for free. Because if you're going to hire a property manager, hire one that manages your investment like an investment. Welcome back to the Bigger Pockets podcast. I'm here with Henry Washington and Jonathan Green talking about when is the right time to invest.

We've covered a lot of topics, but I want to move on to the idea of life. lifestyle, because I personally think about this a lot and like how I want to scale my investing. And when I choose to do deals, because I'm not full time doing this, is a lot based on my lifestyle. Like, what else is going on with me personally and my career of bigger pockets? Other aspirations and hobbies I have. Jonathan, you grew up with this. Like, have you had to fit real estate into your life?

Or has it just always been sort of part of your life? So that's not as much of a consideration for you? It was. But because my dad was an attorney and I started as an attorney, I never thought of myself as a real estate investor. I just was someone who was being smart with money, like a lot of old schoolers that I've talked to. It was just, I've always wanted to have multiple streams of income. That's why I invested in stocks. I just like to have things that produce.

But I think as I got older, I realized, wait a minute, if I want to do a flip, I'm signing up for a second job. Do I have the time when I'm working 100 hours for the government to sign up for another job? The answer is no. So I flip much slowly. And I've never been a high volume flipper because I never was really full time in just investing. And I think that's, again, what's important for people to say? You're saying, I mean, what time does it take? If you want to be an investor, you have another job.

And then do you have a family? You know, is your family going to be mad? Do you want to be spending Saturday and Sunday, unclogging toilets? I don't know. I wanted to be with my kids. So I think it's really, you know, choosing lifestyle is about your family, how you want to live and all of that. Well, you're supposed to get your kids to unclog the toilets. I mean, when they're five, you got to bribe them with like a big, that's, I got bribed.

My dad was bored. You bribe me with a video game. If you come pick up the rent, you know, we'll get a video game. I'm like, okay. Sold. Yeah, deal. Yeah. Absolutely.

And he always came through. So, I mean, but that is a good way to teach the whole on the way. Yeah, that's interesting. Henry, did you have kids when you first started? No, no, I did not. Okay. So do you think that made it a little easier? Yeah, it was, it was easier before I got started only because there was,

you know, less considerations I would need to make. I was married when I got started, but my wife's been all in, you know, since day one. And so it was, it was much easier. I think what really changed when I had kids was my wife's level of involvement. You know, she used to go with me to look at houses and make offers. And now there's probably some family thing that she has to do with the kids if I'm doing that. And so that's changed. Like, you do have to adapt your lifestyle to what you're doing. You know, I went all in from day one. Like, I really took on the identity of a real estate investor from beginning. I put a lot of weight on becoming a successful real estate investor because I didn't,

I didn't want to have a plan B. Like, I just wanted to figure out how this worked. And I had a flexible enough lifestyle. I learned how to fit in the work that I needed to do. I think a lot of new investors get scared because they think, okay, well, how am I going to find the time to do this? Which is what I thought too. But once I actually started to market for deals off market, answer the calls, go on the appointments, and I was even managing my own properties. I quickly realized like what activities actually took chunks of time

and then where I could fit those activities in during my day. And the rest of the things I realized, I could probably just have a spreadsheet or some sort of processor system to take care of. So yeah, you're probably going to be underwater at first, but then you realize, I quickly realize, I'm like, okay, this doesn't take a ton of time. I spend most of my time either analyzing the deals when they come in, going to the appointments and making the offers, and then selecting tenants. Like, those are the time-consuming activities. So I would figure out when I could do those things. I would either do them at my lunch break during my day job, right after work. Like, on my way home from work is when I would go on appointments. That way, when I got home, I could just be with my wife.

and if I couldn't fit it into those time frames, then I probably wouldn't see that house or do that thing. Like that was the time boundaries I had to make. Yeah, that makes a lot of sense. And I think that's the whole key, right? You can really invest with almost any amount of time. When you're first getting started, you probably need a little bit more time.

But you could just adjust your strategy and what you're trying to do based on your own time commitment. In the past, my rule has been like 20 hours a month for real estate. And that's all I want to commit because I've been mostly a passive investor. I'm interested in trying to do some more active things. So I'm like consciously changing that. But I do really think about that all the time that like here's my priorities in life. Like I, you know, my relationships with friends, family, my wife, you know, I have hobbies that I want to.

I have a full-time job. So like what amount of time can I give to this and sort of crafting the strategy? It's probably five to 10 hours a week, I would say, like when you're first getting started as like a good rule. of thumb. And if you can't do that, it's maybe not the right time for you to at least get started. And if you want to scale down, you do that enough to get your first deal. I think then that's possible. But you do need, I think, five to ten hours a week is a good idea. Yeah, I agree. I mean, it's really about how you prioritize the things and realizing that you can't outsource your top priorities. There's a lot of things you can outsource over time. But in the beginning, you can't

outsource someone to learn for you or get reps for you or rely on everybody to do everything for you because that that just makes you a bad investment. You're a passive participant in an active asset, which is a disaster. Can I ask a quick question? Please. Because oftentimes when I hear, you know, when is a good time to invest? People are typically asking me because they're trying to figure out like when they should invest from like a financial readiness position. Some people feel like they need to pay down all of their debt before they invest. Some people feel like they need to have a certain credit score before they invest. Like, I have an opinion about paying down debt and credit and things. But like what do you guys think in terms of like financial readiness? The problem is I think

if you're not by the numbers financially ready, you're likely to get into a rabbit hole of, you know, buy with no money down, which of course is possible, you know, or getting into sub-tube. Both are great options, but also not that realistic for. someone who doesn't have experience. So you could spend a lot of time doing that. I think it's important to have your credit as high as possible, but that's why you go to a lender early on in the process when you're looking and say, how do I look? You know, what is my student loan debt? Like, what's my DTI? Like, you know, how's everything looking? And then get an overview to see, well, if I have to put 40% down because things don't look at, that's just not going to work for me now.

And if you, if you overthink it before you even talk to a lender to know where you qualify, why you may be spending all this time when you're, you know, a year and a half from being ready. I actually, I wrote about this in one of my books. I can't even remember. But I think it's start with strategy about this exact idea, Henry, because I think a lot of people say, you know, I have a negative net worth. You know, I have more debt than assets. And honestly, I think that's where most people start. I don't think that's necessarily a bad thing.

That's where I started. Like, I had student loans when I first started. And I actually, I didn't pay off my student loans. to like eight years into my investing career, I think. I paid mine off like six months ago. Oh, yeah, I remember that. Yes, right? Yes.

Because, like, I was earning more money and interest in my investments than it would to pay off. So that is one calculation you could do. It's like if you have 100, let's just say 100 grand in student debt. Like, if you're going to put that towards your, you know, four or five percent student loan, that's fine. But if you can earn eight or nine percent on rental property on that, invest in earn the eight or nine percent and then, you know, pay off the minimum amount. So that's one thing.

The other part of it, though, is like negative net worth is fine. Negative savings rate is not fine. I think, like, if you're in a point where you are spending more than you are earning, you have building blocks of financial literacy and responsibility to work on. And I understand that people get into that period sometimes to no fault of their own. Sometimes you make a mistake, who knows. But if you're in that situation, you're not in a good place to invest. I don't believe. I think you need to fix that first because otherwise you're just compounding your risk and it's just not worth it. If you don't have an emergency fund for your own life, you definitely shouldn't be trying to invest and not having an emergency fund for your real estate.

Right. Exactly. Yeah. Because they'll both call due at the same time. You know, it's just like Murphy's law. Yeah. Yeah. Yeah.

And like, I don't know. Sometimes when I first bought a property, I put aside some money for, maintenance and, you know, maybe something breaks. You just get bad luck. And then you have to tip into your personal finances. You got to break a little bit more money to the table. And I'm not saying huge amounts, but like if you didn't have that and your personal finances are sort of, you know, walking a tightrope here, paper thin, it's just too much risk. It's not worth it. If you're in a position, this is what I tell. Because what I find is people use this as an excuse because they're scared to start. Most people know that they're ready.

and they're making excuses. But I would say, look, if you are struggling to pay your own bills and you're struggling to make ends meet, you probably shouldn't go borrow money to buy property. But if you've got an emergency fund, you've got some money and savings and you've got a semi-decent credit score, even if you've got other debt that you're working on, I would just do that calculation. Dave talked to like high-interest debt. Yeah, work on paying that off first.

If you've got something at, you know, 15 to 30% interest, pay that sucker off before you go investing. But if you've got, you know, normal debt, a single-digit debt, then I would look at what's my typical cash-on-cash-cash-return for a real estate investment. And if that cash-on-cash-cash-return for the investment is higher than the debt you have, go invest and use that money to pay off your debt. Arbitrash-dette, baby. Exactly. That's potentially the way out when you don't have a lot of money is to get something that earns more slowly. but we've been talking a lot about compound interest and the compound effect. The negative part of that works real well against you when you do it.

If you don't do that first fix because you don't have $7,500 for the plumbing issue, now it's a $15,000 issue. Oh, wait, now your HVAC broke. You can't get out of it. So just as we say real estate can be great for compounding forward, it can go backward real, real quick. So can your finances. I often tell the story of the best credit repair hack I ever heard.

Because when I first got started, a lot of people don't know this. I didn't have great credit. And I worked with a credit repair company to try to help me get my credit back. And they were like, you know what you could do to get your score where it needs to be? You could pay off some of this crap. What a hack. What a hack. Worked like a charm.

That's the first thing I had to do is I had to pay off this outstanding debt that funny enough. The outstanding debt that I had to pay was a debt that an old landlord had put on me. Oh, really? Yeah. It was a full circle moment. That's really appropriate. Well, this has been a great conversation to sort of the lifestyle side of it.

And Henry, thank you for raising that question about financial preparedness. So we've really covered it all, but there's one more topic. We cannot get away from. We're talking about when to invest. And everyone wants to talk about timing the market. Is it a good time to invest? We're going to hit that right after this quick break. People love to call real estate passive income,

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Welcome back to the Baker Pockets podcast here with Jonathan Green and Henry Washington talking about when is the ideal time to invest. We've talked about all of the financial and lifestyle elements. Now let's talk about sort of the timing of the market and if there's a good time. If does that even exist in real estate? This, if you've stuck around till the end, boy, are you in for a treat? Because the data deli himself, the man who looks at real estate numbers for a living, is going to tell us exactly when we should jump in this market because he has it timed. Perfectly. June 24.

Marking on your calendar. February 31st. Oh, my God. No, I, please don't take that seriously anyone. I just made a particular number. I never know. But no, I actually, I made a social media post about this yesterday because I was just thinking about all the objections, either friends or family or people I've heard about buying

real estate since I started 15 years ago. And it was like, in 2010, it was like, oh, my God, the market is literally crashing. And it was. And it was still a good time to buy. In 2013, people were like, oh, it's bottomed out or like prices have been down for four or five years. Like, is now a good time to buy? Then as soon as prices started going up, people were already calling for another crash. Then in 2018, interest rates were going up and people were calling for another crash. Then we had COVID. Then we had this rate height cycle. And it just feels like to a certain subset of people, it's never the right time. And then to be fair, on the other side, there are people who are like overly confident and say that it's always a great time to buy

real estate. And so, Jonathan, let's start with you. Like, how do you think about market timing? Well, I don't, I think you should always be looking. But I don't think that means that the deals are there. You know, you have to, again, that goes back to us talking about reps. To me, I'm always looking and I'm looking at different assets and I'm trying to figure out what I like. And I never stop looking because I love real estate. But I think it goes into, yeah, when somebody says to me, oh, you know, I'm concerned. The rates are high.

I'm like, oh, okay. Well, when do you think they're going to come down? What crystal ball do you have that I don't have? Because you may think they're going to come down in six months and they may not come down. And historically, rates are fine. So it's just like, you know, like, where are we in the cycle? And of course, then you have seller finance where you can adjust. You can, you know, play terms versus price.

And there's so many different things in real estate. So I think that most people, as Henry was saying before, just use it because they're stuck and they're scared to do it. Because if you're just going on, you know, we've had lots of people. They're like, oh, well, you know, the lender said it's going to be 6.5. And I'm only going to do it if it's 6.25. And you're like, you know how much it's going to cost you a month over 30 years? It's like $11. Relax.

Right. But that's an excuse mechanism for not having enough confidence and not understanding what's a good deal. And this doesn't really matter. If it's a great deal, you know, I never, I don't, I just call my lender when I'm ready. What's the rate? Great. Let's go. Awesome.

Yeah. Right. Because I know it's in, you know, he's not like I'm going to be surprised and it's six points higher. It's just the deal's good. I like the asset and I'm an asset hunter. So. Yeah. I think that makes a lot of sense.

The whole game of being an investor is just resource allocation. Like it's not. I think the whole thing is like compared to what, right? People are like, I'm not going to invest in real estate. Okay. Fine. What are you going to do with your money? Is it a better?

option or a worse option. Like that, that's, it sounds overly simplistic, but that's it, right? Is it better to keep your money in cash? Sometimes it is. Like, you know, sometimes it's not. But I totally agree with the sentiment of always be looking. Yeah, man, two best times to buy a property or yesterday and today, right? Like, historically, can you look back and say, yeah, that was a bad time to buy property? Yeah, like, you know, 2000 and early 2008, like late 2007, sure, some people are like, yeah, probably shouldn't have bought that. But like you no one could time that. And for people like us who are deal hunters, right, like I'm buying typically at a bigger discount than a traditional market crash would indicate. Yeah. Like if the market drops 20 to 30 percent, I typically buy at between 40 and 60

cents on the dollar, which means even if the market comes down 20 percent, I should still be right side up, right? Because we're looking for deals. You know, in this particular sense, we're not talking about the normal family going to buy their home to live in. And even if it's that, if you're a normal family buying your home to live in, you're just stay there a little longer. And the market will rebound. Exactly. Like, it's not that big of a deal. Yeah, I totally agree with you. I mean, it's kind of some of the considerations that I've been thinking about in my own portfolio recently It's like, yeah, right now I'm probably going to make more conservative investments than I would have, you know, a couple years ago.

I'm not going to take as big swings because you can't count on that just, you know, it was like 3% appreciation a month. But when it was like in 2020. It's not that. But like, I still think real estate is just a better place to put my money than in cash right now. I had been very open on this podcast. I have some fear about stock valuations right now. And so I think, you know, real estate is a good place to put your money. And honestly, something that drives me kind of nuts is people comparing returns between now and a previous period.

It is totally irrelevant. It couldn't matter less. What matters is what you could do with your money now versus other asset classes. Like, that's the only calculation that matters. And to me, real estate is still an important, a very, the primarily important part of that from my portfolio. I put money elsewhere. but like it is still to me the thing that makes sense. Yeah.

I mean just just it's just a value at aspect. You know, you can't value out of stock. You have no input on a stock. You know, you can't fix it up and you can't just let a stock sit there and it will just improve a value because. I bet some people wish they could right now. Right. I mean, like what if the CEO does something crazy and then it goes down or somebody just

says something in the news and a stock goes down? You know, it's not even real. Real estate, nothing happens. It just goes up generally. If you just do nothing, it's going to go up generally in America, unless you just bought super high. But I mean, even if you just buy land, land's going to increase in value or it's going to have alternative uses. It's, you know, buy real estate and wait. But even if you don't want to wait that long, if you look at the cycle since just since the pandemic, when people were like,

oh, I don't know, it's a crazy time. It was crazy. I have people who are up two, three, four, five hundred thousand dollars on their value because they bought in the beginning of 2020. And other people sat, bought later. They're still up, but they're up less. I mean, you just have to keep your eye on the on the market all the time and look at stuff. And you just also have to zoom out, right? Because let's let's think about it. In the history of America in people, normal people being able to buy real estate, people have bought real estate and made money in every single real estate market at every point in the cycle. Now, people have also lost money doing all those things. But if we study the ways to success and we are cautious, it's always a good time to invest

because of what you said, Jonathan, if you hold on to it long enough, you'll look like a frick-frecking genius to somebody. Always. Well, thank you guys so much. That's a good way to get out on this episode. Thank you, Henry, for closing us out here. Well, Jonathan and Henry, thank you. This was a lot of fun. And a great conversation. I think hopefully this is really useful to our audience. I know it is, it is daunting. Like, I was scared when I first started. You should be scared. You should be. Exactly. Yeah. That's part of it. But it's also risk, with risk comes reward. And so that's do it anyway. Yeah, exactly. Well, thank you both for being here. We really appreciate it. And thank everyone who's listening right now for being a part of the Bigger Pockets community. We appreciate all of you.

And we'll see you for the next episode of the Bigger Pockets podcast in just a couple of days. Thank you all for listening to the Bigger Pockets Real Estate podcast. Make sure you get all our new episodes by subscribing on YouTube, Apple, Spotify, or any other podcast platform. Our new episodes come out Monday, Wednesday, and Friday. I'm the host and executive producer of the show, Dave Meyer. The show is produced by Ian K, copywriting is by Calicoe content, and editing is by Exodus Media. If you'd like to learn more about real estate investing or to sign up for our free newsletter, please visit www.w.w.w.w.com.

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