Are Today's Home Buyers Suffering from MPS?

In today's world entrepreneurialship is the key to a healthy retirement. Learn to recognize the roadblocks that keep you from your dream.

Literally translated MPS is a syndrome that shows up anytime and anywhere without warning.  It sets off a ripple effect much like throwing a pebble into a body of water.  It showed up in my life back in the late 1980s when my "wasband" (former husband) and I were getting ready to buy our first investment property.  We were happy and delighted with our decision and eagerly waited for our real estate agent to go over some details before we set out looking at the properties he had selected for us. (We were living in Maryland at that time and I was not a licensed REALTOR®).  I remember it well, the sun was shinning, it was a beautiful spring day and you could smell the sweet scent of buyers in the air!  A few moments before our agent arrived we got a phone call from a family member and MPS started to kick in full blast!  It stopped us dead in our tracks and we both stood there frozen as if our feet were cemented to the floor!

In case you are wondering, MPS stands for Meddling Parents' Syndrome.  While I certainly do not mean any disrespect, often times this judgmental and harsh syndrome can obliterate a person's dream in a matter of seconds. It can wipe out all common sense and can cause people to become ungrounded.  Needless to say we no longer felt happy and in control but began to have feelings of guilt as we questioned our sanity.

Luckily our agent arrived just in time to listen to our fears and help us reclaim our joy and convictions.  A call into another family member validated our decision, and helped confirm that buying investment property was not foolish or stupid.  They carefully explained how it would indeed help us to build a nice portfolio if we stayed in for the long haul.  Here is a perfect example of two very different viewpoints from family members with opposing views on the subject of real estate investing.  Without pointing fingers at either side of the family, you can see that there were two very conflicting views on the same subject.  One family member believing that real estate investing was as natural as walking upright and the other side of the family had been holding onto beliefs that real estate investing was very wrong and not worth the risk. The latter wanting to always stay within the "safe" zone.

As it turned out we did end up purchasing an investment property.  In fact, we were able to buy two properties!  And we happily held onto those properties while we continued to be transferred from one city to another across the United States.  We were able to purchase our dream home in Colorado with the sale of these both properties and the rest is history.  This indeed was the one best investment we ever made!

The biggest block that I have observed over the years with either first time home buyers or young, investment buyers is that they are highly influenced by their families.  And their families' views on financial wealth and stability will depend upon the environment in which they were raised.  Some people have a belief that working all of your life in one job and putting money away in retirement fund is the only method to a long, financially secure retirement.  Others have a belief that your money should be working for you and spread their investments out to include a plethora of different options where they can see not only long term payoffs but short term as well.

My advice to young people is to not be overly influenced by your family.  If you are married talk your investment strategies over with your spouse and then seek the advice of a financial planner, realtor, etc.  Family members mean well and are looking out for your best interests.  However, they are often prisoners of their own fears so be careful and listen to their words and advice with an open mind and don’t buy into their fears. 

In today's world entrepreneurialship is the key to a healthy retirement.  The days of putting money away into a savings account, and then relying on social security for your retirement years are long gone.  The good news is that your chances for a thriving retirement increase when you think out of the box and take control of your financial future.

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Sunny Pacalolo April 23, 2012 at 01:36 AM
Investment property requires a downpayment of at least 20%. How many young people have $80,000 laying around to plunk down on real estate that may not hold it's value. Parents should be involved in such a major decisions, even if it is to provide practical advice, and not discouraged or the subject of ridicule or scorn. Being a landlord is a time-consuming thankless proposition riddled with issues such as tenants who cannot pay to clogged toilets to making certain that the landlord is not inadvertently discriminating against disabled persons, families or violating health and safety codes. Of course, the young inexperienced starry eyed investors can always hire a property management company for 10% but that eats into their slim profit margin. The "experts" including the Realtor, all have a financial angle in wanting to see a sale take place. A commission on the sale of a $400,000 income property can be over $20,000 and in this market, more than most Realtors make in an entire year. Real estate is no longer a hedge against inflation and can wind up being one great big PITA.
Linda Kemp April 25, 2012 at 10:50 PM
Thank you for your comments Sunny. However, today's investors do not require 20% down. There are numerous programs that allow investors to buy as many as five properties (Fannie Mae Home Path) without residing in any of the dwellings. There are quite a few programs out there intended to get our neighborhoods back in shape. As far as owning property. . . I was once a renter. I took good care of the properties that I lived in. For some reason renters have gotten a bad rap. As a landlord I screened my potential tenants and took a walk out to their cars with them. Perfect credit does not mean that people will necessarily keep the property in shape. As a property manager I also screen tenants and make sure that everything is running smoothly. It is like any other business. You need to keep up on everything and it will pay off. As far as commissions go you are misled. Most agents pay for all of their own expenses. In this day and age we are spending much more on our marketing efforts. Our commissions are split with our brokerage. I think you would be very surprised to find out what we take home when you take off taxes and expenses. I work weekdays and I work weekends. I am also a single Mom. I respect my clients and treat them with integrity. It sounds like somewhere along the line you had a bad experience. I am truly sorry for that. I enjoy my job and my clients. I enjoy helping people. In this day and age it makes a difference to love your job!
Carolyn Behrens April 26, 2012 at 04:20 PM
I agree with Linda, I was looking for property to invest in when I noticed some Sallie Mae Properties were 3% down!! As far as property management companies go, in my opinion they're worth the 10% for some people who just don't have the time or experience screening people. My husband and I rent our upstairs apartment ourselves but in the future we might need a management company to help us out so I'm glad we have them. You are so right about perfect credit not assuring that they will keep the property in shape. We've already experienced that. You learn to screen better. Loving your job and helping people is definitely a big plus. My husband and I rented for many years before we bought and we always took care of the properties that we lived in too. Explore all possibilities by keeping an open mind!
Linda Kemp April 26, 2012 at 07:15 PM
Thanks Carolyn! The thing that I have found and apply to all aspects of my life is this: You don't know, what you don't know. Sometimes we play out a scenario in our heads and create a fictitious outcome. We all do this in one way or another. Thank you for bringing to light the many opportunities that exist out there in today's real estate market.


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