As you prepare to become a successful real estate investor, I encourage you to take the following tips into consideration. They have helped me greatly as I have navigated my way through the world of real estate–and life in general. I hope these tips will make just as big of an impact on your life as they have had on mine.
Tip #1: Create a game plan.
Decide what you want to accomplish and outline the steps that you must take to get there. Who will be involved? How will you meet them and gain their cooperation? How much time will it take? Where will you find this time? How much will it cost, and where will you get this money? What’s the risk? How will you handle it?
This plan will serve as your guide each day, so you need to get it right. That brings us to the next tip…
Tip #2: Have an expert review your plan.
The first real estate investing plan I created involved me single-handedly buying 100 houses in a year. And it listed several different marketing strategies that were completely cost ineffective. I had a friend of mine (who isn’t even involved in real estate) review the plan, and he said it looked good. How silly of me!
About eight months into working this over-reaching and misguided plan, I had an expert investor review it. He tore it apart, and together we reconstructed a better plan with more realistic goals (buy 12 houses, not 100) and a more effective marketing plan.
Shortly thereafter, I bought 6 houses, and I actually felt good about my progress. Six out of twelve feels much better than six out of 100!
Tip #3: Don’t give up.
The life of a new real estate investor is filled with countless highs and lows. You’re on a high when you think you have a property all locked up to purchase, and then you hit a low when it suddenly falls though at closing.
Or you’re on a high when you finally do close on that house, but you hit a low when you hit a 3-week dry spell and it feels like you couldn’t get a seller to agree to your price–even if you paid double.
I hit a personal low when I was jobless and $5,500 in debt from fruitless marketing attempts. But I got up early each morning and worked toward my goal of financial freedom. Even though a voice in my head told me to give up, I never did.
That’s probably the #1 key to success: Don’t give up. Even someone who’s as dumb as a box of rocks will eventually succeed if he doesn’t give up.
Tip #4: Take baby steps.
When you break it all down, big goals, big dreams, and big plans are nothing more than a series of miniature action steps or “to do” items. When you dissect the daily life of a successful investor, you’ll find that he or she does 8 to 12 things each day that are real estate related.
One item might be “Watch DVD #5 in the new investing course I bought.” Another item might be “Call the title company about the name on the warranty deed” or “Meet the inspector at the house on Watson Street.”
All of these little tasks each day add up to what is, or what eventually will be, a large and highly profitable real estate investing operation. So don’t toss that “to do” list by the wayside, thinking that your small efforts today don’t mean much. They mean everything.
Tip #5: Become comfortable with discomfort.
I was actually nervous at the first real estate investing meeting that I attended. I was wondering if I would say something stupid or if I wouldn’t fit in. After all, most of the investors in the room were 40 or 50 years old, and I was 22.
But by the third meeting I attended, I became comfortable with the crowd. Had I quit after the first meeting, I would have missed out on the very information that enabled me to buy so many properties.
I’ve learned that one of the biggest keys to success is persisting though uncomfortable situations until they eventually become comfortable. This is where true growth occurs.
Tip #6: Do what you say you’re going to do.
As a real estate investor, your reputation means everything. They say it’s a small world, but the world of real estate investing is even smaller. So be honest, be courteous, and for heaven’s sake, do what you say you’re going to do. If you say you’re going to buy another investor’s house, by golly, you better move mountains–if that’s what it takes–to buy it!
Otherwise, your name will eventually become mud, and you’ll have a tough time buying from not only that investor, but just about every other investor in town. Believe me, I can count at least 10 local investors of the top of my head who I will NOT do business with because their word means nothing. And I know several other investors who won’t deal with them either. You DO NOT want to be black listed.
Tip #7: Be on time.
Showing up late is just about one of the most disrespectful things you can do to another real estate investor, inspector, contractor, or anyone for that matter. It shows them that you don’t value them or their time, and time is MUCH more valuable than money. Money can be replaced. Time cannot.
When someone shows up late for a meeting with me, they instantly lose credibility. And there are countless other investors who feel the same way I do. On the other hand, when an investor or business associate shows up on time or early, it makes me want to smile, reach out my hand, and strike a win-win deal.
So be on time. You’re much more likely to create trusted allies who can help you along your path to success.
Tip #8: Eliminate certain activities.
I’ll wrap up with one more tip that is closely linked to the first tip, “Create a Game Plan.” That game plan will involve a series of goals and steps or “to do” items that you must follow to become successful. But what many people don’t seem to realize is that for all of these things to happen, certain activities in your current schedule must be REMOVED.
For example, if you’re going to attend two real estate meetings and make five offers per week, what must go? Possibly TV time. Possibly a friendship. Possibly your workout plan. Of course, what has to go is unique to each of us, but you must realize that if you’re an extremely busy person, you’ll have to make some TOUGH sacrifices.
But these sacrifices are only for the short run. If you have to quit your exercise program to have enough time for real estate, for example, then so be it. You can resume in two years after you’ve achieved financial freedom through real estate. And you’ll have more time to exercise than ever.
It can be a tough to integrate all of these tips into your daily routine at once. So for now, I encourage you to focus on the one tip that you think can benefit your investing business the most. After you’ve turned that tip into a habit that’s part of your daily routine, then move on to the next. Keep moving forward and never give up, and you’ll be a successful and financially free investor in no time!
[Doug Smith has bought and sold over 40 properties using almost every method–wholesaling, rehabbing, landlording, subject to, lease options, and more. He is the founder and president of MyHouseDeals.com, a company that provides a constantly-updated list of bargain-priced investment properties in some of the nation’s largest metro areas.]