Why I Don't Invest in Real Estate

I’ve been reading a lot of blogs regarding FIRE (Financially Independent Retire Early) and I’ve noticed that many of them have included real estate in their equations.  Many have rental units that generate passive income.  It almost seems like a good way to make more money while not working for it.

Photo credit: Mike Yakaites

So why don’t I invest in real estate and rental properties?  With rental properties, I wouldn’t make a good landlord.  Since the law seems to be on the tenant’s side, I would be afraid to rent to a bad tenant.  And I don’t want to be that person that has to listen to every little complaint and fix every little problem.  I hate doing work inside my own home, but I do it.  I hate even paying more for a professional or handyman to do simple tasks.

There is a blog post that I read recently that sums up real estate expenses, and it is not for the lighthearted (me).  This blogger owns properties and had some unexpected expenses recently and lists them in his post.  Real estate expenses most be planned and prepared for.  It is not all easy money, that’s for sure.  Check it out here.

Now getting back to owning real estate that is not rental property.  I have owned three houses during my lifetime and it all didn’t end up to so well.  Our first home we purchased in the high market and although didn’t some minor work on it while we lived there (14 years), it sold for far less than we paid for it but at least it covered the remaining mortgage.  I had a second house that was once a summer cottage that has had so many problems (can you say money pit?) that I fear is not going to turn out well when and if it sells.  Finally, since we moved to another state, we have a modular home (or some say mobile home, but isn’t).  It was inexpensive, so no mortgage therefore no tax credit.  We thought this would be our forever home but are making plans to move again and are hoping once again to break even on this one.

Although, I have given up on owning real estate, I have been thinking of real estate crowdfunding.  Have anyone else checked into that and/or have investing in such?  This blogger is interested in knowing your thoughts.