One of the most overlooked risks in real estate isn’t rising interest rates, leverage, or even tenant issues—it’s execution fear. You run the numbers. The perty checks all the boxes.
It fits your timeline and lifestyle. You can even picture the steady cash flow hitting your account… Yet you still don’t pull the trigger. It’s not because you’re being irrational.
It’s because real estate is a heavy lift—mentally, financially, and emotionally.
The fear of committing to such a large, long-term decision can quietly kill what might have been a life-changing investment. Fortunately, with mortgage rates still elevated, there’s no rush to buy.
But as inventory builds, more opportunities will emerge. The question is: Will you try and pounce on a deal before mortgage rates finally come down.
A Reader’s Reflection On Missing Out On Real Estate Opportunities Here’s what a reader recently d on my post, How To Survive The Most Dangerous Time After Purchasing A , that inspired this post: “There’s another real estate risk—and that’s execution.
I’ve twice held back from what would’ve been outstanding perty investments due to what I guess you’d call ‘execution fear.
’ Maybe a topic for another article: how to overcome the fear so you don’t miss the opportunity and actually execute the deal. ” This reader isn’t alone.
Before and after every single purchase, I’m full of fear too. I'm always cautious buying near a market peak—especially after the mistake I made in 2007 when I bought a vacation perty I didn’t need.
Even though I got it for 12% below the previous year’s sales price, it still went on to drop another 50% at one point.
Before submitting an offer, I wonder whether I should really buy something nicer I don’t need. I never do. While I’m in escrow, I’m scrambling to uncover any maintenance red flags.
Sometimes, I delay the close because the dread of making mistake is overhwhelming. And after closing. I’m stressed how long it’ll take to rebuild my liquidity and feel safe again.
In the meantime, I hope no unforeseen disaster happens that bleeds me dry. What Is Execution Fear. Execution fear is the resistance that shows up after you’ve done the re.
It’s that gnawing hesitation right before committing. It sounds : What if this is the top of the market. What if something breaks and I can’t afford to fix it. What if I’m not cut out to be a landlord.
What if a president enacts a policy so asinine it tanks the global economy right after I buy. What if a wildfire ignites in the middle of the night, torching my perty and every one of my neighbors.
These are all valid questions. Because un stocks, where you can more easily buy the dip, real estate isn’t a click-and-buy-and-sell asset. It’s hands-on, debt-laced, and slow to give back.
Once you've purchased the perty, you're ly stuck with it for years. Why Execution Fear Happens The weight of responsibility. Real estate isn’t just a purchase—it’s a multi-year commitment.
The permanence. You can’t unload it with one button. Analysis fatigue. The more you re, the more “what ifs” you find. Perfectionism. You want a unicorn perty that might never exist.
Out of fear of making the wrong decision, many people end up making no decision at all—which, of course, is still a decision.
But over time, regret tends to creep in as missed real estate opportunities quietly pile up.
Therefore, I thought I'd write a post how we can all overcome execution fear to build more wealth and happiness.
How to Overcome Execution Fear In Real Estate There’s always a bit of fear when you’re to buy a high-priced asset or step outside your comfort zone— asking someone you find incredibly attractive on a date when you barely know them.
But with time, that fear tends to fade. As you get older, you become wiser, more self-assured, and more comfortable taking calculated risks.
You've learned how to perly value and analyze an investment perty, Further, you've also made more mistakes and have learned from them.
Let’s walk through some tips to help you move past the hesitation and start going after what you truly want. Ask: Can I Survive the Worst-Case Scenario. This is my ultimate gut-check.
If the perty cash flows less than expected, the roof leaks, or I get a nightmare tenant—can I survive financially and emotionally.
In expensive cities San Francisco or NYC, negative cash flow is common, especially in year one or two with 20% down. These are appreciation-focused , not yield plays. Know what you're walking into.
If you dare to buy a $10 million perty, be prepared to stomach $1–$3 million in potential paper losses during a housing downturn.
If you can handle the downside, the upside might just be worth the risk. Go Through A Regret Minimization Exercise Risk can often be managed. Regret, on the other hand, tends to linger.
Whenever I’m facing something risky, I to run a regret minimization exercise.
It’s a simple cess of weighing the upside against the potential downside—and asking myself which feeling will last longer: the pain of failure or the regret of not trying.
For many boys, our first taste of this comes from asking a classmate out. Since girls still rarely make the first move, only the most confident boys end up with dates or m partners.
The mental calculation is straightforward: is a few minutes of embarrassment worse than the excitement of a yes. After freshman year, I decided the sting of rejection was manageable.
And with each attempt, it hurt a little less, making it easier to keep choosing bravery.
Regret Minimization Exercise With My Current More recently, I went through a regret minimization exercise after stumbling upon an ideal to raise a family.
It had panoramic views of the Bay and the Golden Gate Bridge, along with a large, enclosed lot.
I had to weigh the regret of selling stocks and bonds and potentially watching them rise, against the regret of missing out on this “once-in-a-lifetime” .
In the end, I chose the house and the life it could help create. 21 months later, I’m grateful I prioritized a better environment for my family over the possibility of higher returns.
Boy do kids grow up fast. But it sure would be nice to have greater stock returns. You can't have it all. Build an Execution-Ready System The more prep, the less panic.
This is called pre-mortem planning.
My checklist includes: Financing pre-apved + 10% of value in cash reserves or low-risk assets to my 30/30/3 -buying guide A vetted contractor or handyman A perty manager or DIY plan Insurance quotes + estimated closing costs An expert to talk the deal through Preparation kills fear.
Want fewer surprises. Review all the hidden ownership costs after purchase. The more you familiarize yourself with the potential surprises, the fewer surprises you will have.
Learn from the Real Estate Deals You Didn’t Do Use past hesitation as fuel. Ask yourself: What made me hesitate last time. Was it valid—or just fear wearing a logical disguise.
Missed opportunities are painful. But they’re also teachers. And if you miss one dream perty. Don’t worry. There’s always another one down the road. The world doesn’t run out of s.
Only your courage to buy them.
Set a Greenlight Framework Instead of waiting for a “perfect” deal, define what’s “good enough”: Cash-on-cash return > risk-free rate + 3%+ premium to compensate you for the risk you take Cap rate > borrowing cost Location with real economic drivers you believe in A life stage where you can commit to 5+ years of ownership, the longer the better If the deal meets your framework, it's time to buy.
The people who never build wealth are the ones who never take calculated risks. Reframe Your Identity Tell yourself: “I’m someone who takes informed risks and s through.
” This isn’t bravado, it’s self-belief. You did the work. You ran the numbers. Now it’s time to let your preparation pay off. Words have power. Remove the negative self-talk from your life.
If you never act, all that diligence becomes wasted energy. Execution Regret Hurts More Than Execution Mistakes One of the hardest parts real estate is that inaction doesn’t hurt right away.
You feel safe. You preserved your cash. There is no uncertainty. But five or ten years later. That “safety” often turns into stagnation. Inflation marches on. Asset prices tend to rise.
That once “too expensive” . Now it’s a bargain. And your peers. They’re buying their next while you're still stuck in the same place, older, and maybe a little resentful.
Life moves on with or without you. Comparing Houses Hurts More Than Comparing Stock Portfolios Here’s another nugget of truth: It stings more to see a peer living better than better.
A friend with a bigger stock portfolio. No big deal. Stocks don’t bring joy. They're just funny money on a screen that can ocassionally make you moody during violent corrections.
Sometimes you can feel a little sorry for peers with massive stock portfolios who still far below their means.
It’s as if fear and frugality have paralyzed them—trapping them in a hoarding mindset that prevents them from truly enjoying their wealth. But a friend with a nicer . That’s harder to ignore.
You’ll have to find a way to appreciate what you do have because envy doesn’t build wealth. It just breed unhappiness.
Execution Fear Will Naturally Decrease Over Time The next time you’re paralyzed with execution fear, take a deep breath. Run the numbers again. Model out the worst-case scenario.
If you can handle it, move forward—knowing you might still lose money, and that’s okay. Even pocket Aces get cracked around 15% of the time pre-flop when you’re going heads-up.
If you decide not to execute, be patient. The market always brings new opportunities. Eventually, for the sake of living your best life, you’ve got to make a move.
Real estate, over the long run, tends to go up and to the right. If you desire, climb that perty ladder until there aren't any more rungs.
You don’t want to look back at 70 and wish you’d taken a few more calculated risks to better. I’m 48, and I still wish I had bought more perty in New York and San Francisco when I was younger.
I’d be at least $2 million richer today. But I’ve learned from my fears and I’m applying those lessons now. It’s never too late. Your Turn: What’s Holding You Back.
Have you ever passed on a great deal due to execution fear. What kept you from moving forward—and what did you learn. This doesn’t just apply to real estate. Stocks, careers, es—we all hesitate.
So why do we fear taking risks when the wealthiest people in the world are often the biggest risk takers. Drop your story in the s—I’d love to hear it.
You might spire someone else to overcome fear and move forward.
An Easier Way To Invest In Real Estate The biggest reason people are so afraid of buying real estate is the sheer amount of money they have to borrow.
Even with a 20% down payment, borrowing 80% on a typical perty in San Francisco still means taking on a $1. 4 million mortgage, for example. This is where Fundrise comes in.
With a minimum investment of just $10, it’s easy to gain exposure to private real estate across the country. No leverage is required, and you can dollar-cost average in at your own pace.
Fundrise primarily invests in residential and industrial commercial real estate in the Sunbelt region, where valuations are lower and yields tend to be higher.
As someone who owns real estate in expensive San Francisco, Honolulu, and Tahoe, I truly appreciate the diversification this offers.
My Fundrise investment dashboard split between real estate and venture. Fundrise is a long-time sponsor of Financial Samurai as our investment philosophies are aligned.
If you want to stay informed everything personal finance, join 60,000 others and to my free weekly .
You can also get my posts immediately sent to your e-mail as soon as they are published by signing up here.
My goal is to help you achieve financial freedom sooner so you can do more of what you want and less of what you hate.
Financial Samurai began in 2009 and is now one of the largest and most trusted independently owned personal finance sites.
Every article is based on firsthand experience and knowledge—because money is too important to leave in the hands of the inexperienced.
TweetPinFlip The Author Financial Samurai Sam started Financial Samurai in 2009 to help make sense of financial chaos.
With an MBA from Berkeley and 13 years of experience at Goldman Sachs and Credit Suisse, he helps readers achieve financial freedom sooner.
Join 60,000+ others and for his free weekly so you never miss a thing. Sam is currently in residential commercial real estate and AI companies through Fundrise.
Finally, to build greater wealth, pick up a copy of his upcoming bestseller, Millionaire Milestones: Simple Steps To Seven Figures. It'll be the best personal finance book you'll ever read.
Notify of new -up s new replies to my s Label {} [+] Name* * Website for the private Financial Samurai . Δ Label {} [+] Name* * Website for the private Financial Samurai .
Δ 8 s Newest Oldest Most Voted Inline backs View all s Think and Talk Money 10 days ago Yup, we’ve all been here at some point.
I’ve found it to be easier to make a decision on an investment perty than on a for my family. With investment perties, you can more coldly run the numbers and leave emotion out of it.
You still want to look for perties that have emotional appeal. It’s just emotional appeal for other people, not yourself.
When it comes to running the numbers, many aspiring real estate investors I talk to get stuck looking for the perfect deal.
The blem with that is even running the cold-hard numbers requires certain estimates and jections. There’s always a bit of mystery and guessing involved.
The experts have a hard enough time with these jections. How are newbies supposed to get it right every time.
If your numbers are close to your targets, and the perty passes your other criteria, why not go for it. If you’re still hesitating, it may just be a sign that real estate is not for you.
Nobody wants to buy a bad deal, but if it happens, it’s part of the education cess. You will be better equipped for your next deal.
Compared to how much it costs to go to college these days, even a deal gone bad is a bargain for the educational value.
Thanks, Matt 1 Reply Author Financial Samurai 9 days ago Reply to Think and Talk Money Totally hear you, Matt.
It’s funny how many people wait for the “perfect” deal, when in reality, real estate always comes with.