The Same Characteristics Define Successful and Not-So-Successful Real Estate Investors. It’s Your Choice.
If real estate investing is so great, why doesn’t everyone do it?” is a question that many wannabe or future investors ask themselves. I certainly did. Whether you’re already a full-time investor, a part-time investor or someone just considering whether to become one, it’s a question that you’ll have as you do your due diligence to decide what scale—if any—you want for your real estate investment business.
And as someone who talks and writes a lot about real estate’s value and benefits as an investment vehicle, I think it’s a very relevant question. In my case, real estate investing has been a great business. I started out as a part-time, or weekend, investor and now am a full-time investor with a real estate investment business in Dallas.
Some people enjoy real estate investing strictly as a hobby. And I know plenty of other people who see their real estate investing as a personal mission to serve others. So it can mean a lot of things to a lot of people, and it can satisfy a lot of different needs, desires, goals and objectives for a lot of different people, depending on how you approach your real estate investing and why.
Now, I’m not the only person out there proclaiming the value and merits of real estate investing. There are television shows, books, seminars, clubs and lots of professional instructors—or gurus, as they’re often called. There also are late-night infomercials, websites, radio shows, magazines and even podcasts.
With so many people proclaiming the benefits of real estate investing in so many different ways, it just begs that question, “Gosh, if it’s so great, why isn’t everybody doing it?”
Well, I will tell you from my experience, I’ve seen a couple different characteristics of successful real estate investors, and these same characteristics can become barriers to those who ultimately decide not to participate in real estate investing or who don’t find the success in it that they had sought. I’ll also tell you, as a real estate investor, that you’ve got to be willing to make mistakes and not excuses. You’ve got to be willing to recognize that you are “smart as long as you start.” And then finally you’ve got to recognize that you must work to make real estate work.
Let’s look at each of these a little more closely.
Be willing to make mistakes, not excuses
Let’s all admit that excuses are easy. There’s no real benefit. There’s no real value. There’s no real experience or greater understanding that results from excuses. They’re common. And they’re frequent. And all of us—some more than others—are guilty of making excuses. Because they ARE easy.
Mistakes, on the other hand, are difficult. They can cost you time and money and can set you back in all different sorts of ways. But I will say that beneath the strife of mistakes lie the benefit, value, education, experience and understanding that you never would have gained if you had opted to make an excuse instead.
I’ll be the first to admit that in my more than 10 years as a full-time investor and HomeVestors franchisee, I have overpaid for houses. I have overestimated what I could ultimately sell a house for. I have underestimated repair costs. I have even under-offered for houses and lost those deals because of it.
And those are just a few of the mistakes I’ve made in my real estate investing career. But I have learned and benefited from all of them, and I regret none of them. Each of them opened my eyes to a new opportunity or a new understanding or a new competency or efficiency that I’ve gained despite the pain of the mistake.
So my tip to you, as you’re looking at real estate investing, is to change your definition of failure from the number of mistakes you make instead to the number of excuses you make. If you’re more prone to excuses, then that may be the key obstacle that’s standing in the way of your success, and that is likely what could be causing your failure to move forward.
‘You’re smart as long as you start’
You’ve got to be smart. And you are “smart as long as you start.” Here’s what I mean by that. I know a common excuse and even a hesitation of my own was, “Gosh, I don’t know enough about real estate to be an investor. I’m not smart enough. I’m not experienced enough. I’m not educated enough. I’m not financially positioned properly.” I just wasn’t confident that I had “the smarts” to be a successful real estate investor.
But I will tell you that you ARE smart as long as you start. You’ll be shocked at how far you will go and how much you will know once you get into real estate investing, take that first step and move forward.
You can educate yourself. Prepare yourself. Study, observe, analyze. You might think that it will be easy to succeed in real estate by taking courses or going to clubs or by reading books or websites. But none of that is a substitute for getting started.
That’s what successful real estate investors know. A common characteristic that I see among them is they have no hesitation to get started.
I admit I don’t know all the answers, but I do have experience of learning more and more as I go forward. Once I get started and take it one step at a time, the future becomes clearer and clearer. I believe that will be true for you, as well. As you continue to go forward, it’s amazing how much further ahead you will be able to see.
It takes work to make it work
You know, there’s a lot on television these days about real estate investing, about rehabbing houses, about fixing and flipping houses. But as I’ve said before, real estate investing is not necessarily “as seen on TV.” It’s not as easy it looks. And it shouldn’t be.
Those shows are for entertainment purposes only and are limited in the amount of time that they have to tell a story. So there’s a lot that goes into those experiences that are depicted and those investments that those professionals make that you never get to see.
There’s a lot of legwork up front. There’s a lot of legwork during the process of fixing and flipping those homes, and there’s a lot of work after those cameras are turned off and the house is complete. Real estate investing is not “as seen on TV.”
All the successful investors that I know or that I’ve read about or listened to have worked hard to get where they are today. And they fall into one of two buckets: They are either working hard at the present to build their business and to become successful investors, or they worked very hard in the past and they are now reaping the rewards of that hard work.
Real estate investing is not ‘as seen on TV’
It’s not enough to simply have a plan to work hard in the future. Or to have a plan to not work hard at all. It’s not “as seen on TV.” It’s much more difficult, and it takes much more effort behind the scenes when the cameras are off, so to speak. I see a lot of investors who aren’t prepared for that, and that alone becomes their obstacle to success.
I encourage all investors—as you’re doing your due diligence to explore whether or not investing in real estate is right for you—be prepared and recognize that to be a real estate investor you also must be an investor of your time and your energy in addition to your money. It takes a lot of time and energy. It’s a business. And it needs to be run like a business, and it will take everything that you’ve go—as it would with any other business that you choose to pursue.
Is real estate investing right for you?
It’s no secret that I think real estate investing is a tremendous investment vehicle to create wealth and income, and it’s an excellent business model. And I’ll also state that real estate is not right for everyone, nor is everyone right for real estate. Only you can determine whether or not you’re one of those who is right for real estate.
I encourage you to consider these questions:
• Do you have the willingness to make mistakes and not excuses?
• Can you change your definition of failure to one that is measured by the number of excuses you make instead of the number of mistakes you make?
• Can you recognize that you’re smarter than you think and you’re smart as long as you start? As long as you get started and take action and take that first step, you’ll be shocked at how far you will go and how much you will know once you get going. But you DO have to work in order to make it work.
• Are you willing to invest not only your money, but also your time and your energy in order to become a successful investor?
If you can answer yes to all of these questions, then I think you’re on track to becoming a successful real estate investor and business owner.