Real Estate Investing-Strategies to Become A Successful Investor
Well, real estate is always good, as far as I’m concerned. -Donald Trump Real estate investing is one the pillars of wealth creation in the world today. The last time I looked at the Forbes list of 400 richest Americans, I could still count over 31 Real estate tycoons listed as billionaires. In the same vein, you have individuals in your city and state who have made their fortune and hold their wealth in real estate investments. What Maslow can teach you about investing in real estate? Abraham Maslow eminent psychologist and author of the concept hierarchy of needs in his 1943 paper “A Theory of Human Motivation”, observed, that people are motivated to fulfil three basic needs before going on to other needs. The three basic human needs are food, shelter and clothing. When you invest in real estate, you add value to your customer in an important area of human need-shelter. In fact, you are investing in an evergreen industry. This is why, I believe you should include real estate as part of your wealth-building portfolio. However before you begin investing in properties you need to understand these critical success factors…. Clarity is important How you start depends on what you want to achieve: Are you looking at wealth accumulation within a short time frame (3-7 years)? Are you investing for the Long term (retirement)? Do you want be a Full time investor and derive all your income from your real estate investments? You need to develop critical success traits The next thing that is important is you develop the success traits of a real estate investor. Five main traits are important for success: Competency in your niche, this means you know about the basics of real estate, at the minimum and then you are good in the real estate niche you decide to invest. Control over your emotions. This is important if you are going to stay in the arena for the long haul because there will always be difficulties in the real estate market. The difference between a novice and a professional is the ability to ride the eye of the tiger without getting into the belly of the tiger. Being a real estate investor takes guts and you need to have them if you want to become wealthy Comprehension. This means know your market cold. You understand who your customers are, what they are looking for, why they want to deal with you. If you lack these key trait-insight into your market-you are doomed to fail Consistency. This means you have focus and discipline to, take action daily, weekly until you accomplish your goals. Integrity. You stay true to your principles, because integrity is important in real estate. This means you are trustworthy, to your bankers, investors and tenants. Strategy vs. tactics The strategy (what to do) is more important than the tactics (how to do) of real estate investing. Let me explain. If for instance, you wanted to gain wealth in a very short term then to buy and hold real estate, which is a long-term strategy-will not be the right strategy to achieve your goals. Flipping and wholesaling properties- buying undervalued properties and selling at a higher price to gain profit-may be the best strategy. Knowing enough vs. Knowing it all I think it’s important to have an understanding of real estate investing, however you don’t need to know all about real estate investing to start. You need to one thing that I think is important for an investor…You need know enough about the basics-how to analyse properties, how to get financing, and how to assemble you real estate team together. That is it. If you wanted to make a full time career as a real estate investor, then you would have to know more. You would have to specialize in a niche. I am not going to spend many hours learning about short sales, wholesaling and foreclosing investing especially if I am not going be a full time investor. It would be counterproductive for me, when I should spend my time doing what I am best at doing. Let’s recap, to succeed investing in real estate… You need to understand why you are investing in real estate. You need to develop critical traits for success as a real estate investor. You need to choose the right tactics to match your investing objectives. You need to know enough about what you want achieve This is how I have applied myself to real estate investing. Moreover, it has helped me transform my losses to wins. I have as a result enjoyed positive cash flow from my properties. To your success.
7 Tips to Invest In Real Estate and Become Wealthy
Real estate is at the core of almost every business, and it’s certainly at the core of most people’s wealth. In order to build your wealth and improve your business smarts, you need to know about real estate. DONALD TRUMP, Think Like a Billionaire I recently checked the Forbes Rich list of the wealthiest Americans. I could not help but notice the pattern of wealth creation; almost all the wealthy individuals were entrepreneurs or offspring of entrepreneurs. Secondly, they derived their wealth from owning or investing in real estate, technology companies, the stock market, manufacturing, the entertainment industry, retailing, and commodities. This pattern of wealth creation reinforces my belief about the primacy of investing in real estate as a vehicle for creating wealth. I believe you can succeed when you invest in real estate. What you need is to have the right attitude and mindset. I have learned by trial and errors some of the important lessons in real estate investing. My main area of focus has been residential properties. Even if you are an experienced real estate investor, some of the tips I share still apply to your investing, because they are timeless tips that will set you on the road to success. Here are some specifics about investing in real estate that could propel you to wealth quickly. I urge you to take these tips seriously. Tip#1. Start small The reason you want start small is you are on a learning curve. You want to keep your risk small. I would suggest you invest a lot of time learning the basics of real estate, and a little money in your first deal. Unfortunately most people do the opposite…they invest little time and spend a lot of money. This is the reason many investors fail and they wander why they failed. The fact, real estate is a wealth generator does not mean you don’t have to learn about –how it works to make you wealthy. Tip#2. Invest for value. Avoid speculation When you invest for value, you are on the right path to wealth creation. How do you invest for value? The answer is simple. Look for properties with cash flow and potential capital gains. This is important because value investing in real estate is the basis for wealth creation. Donald trump, Sam Zell, Donald Bren and all the other real estate moguls you can find in the Forbes richest list-made their fortune in real estate by creating value. There is a difference between a value investor and a speculator. A value investor buys a property based on overall value, both today and in the future. A speculator buys with a hope that the price of the property will increase…this kind of approach is no different from playing at the casino tables in Las Vegas. Tip#3. Start and stay close to home. When starting out as a beginner investor, it’s important to concentrate on an area close to home…one you can get to know very well. When I say close to home, you can drive, walk, or cycle around the area regularly. When you concentrate on an area close, you can observe if it’s declining or growing. You can observe the trend in sales and property rentals. Also, look for the top brokers in your area, and call them to find out more about the neighborhood. This is important because when a property comes on the market, you can know quickly if it is a good deal, and you’ll be able to act fast. My first real estate deal was a disaster because I bought a property that was 3 hours drive from home. I failed because I was not close enough to understanding and observing the trends in the local real estate market. Tip#4. Expect to make mistakes. When you start investing in real estate or any business, you are bound to make mistakes-everybody I know does. Remember your mistakes aren’t setbacks. They are steps in the learning process. It is essential to learn from your mistakes, correct them, and keep taking action. The fact you can make mistakes is one reason to buy properties with positive cash flow because it can help you buffer those mistakes. There is a theory for success called accelerated failure. The reasoning behind this theory is that you will most likely fail at the initial stages of starting any business. However, the faster you can fail forwards, the quicker you can begin to succeed. So don’t let the fear of failing stop you from starting investing in properties…it’s all part of the learning curve. Tip#5. Know what you can afford. This means finding out how much it will cost you for the cash flow you want. In other words, what will it cost you to get an ROI (return on investment) of 20%, 30%. Secondly, if your assumptions about the property deal are wrong, can you afford the losses from your mistakes. Before you start investing, ask yourself these questions; how long can I afford a vacant property if my tenant moves out? If there is a costly maintenance problem, can I afford it? Remember, the purpose of real estate investing is to solve your financial problems, not give you bigger ones to solve. Tip#6. Look for Ugly ducklings you can turn to swans One of the best ways to make money in real estate investing, is- to look for is a property that someone has walked away from-because of a problem. Figure out how to fix the problem and you can instantly increase the value of the property. One example that comes to mind is a one bed flat I bought recently in an apartment building. The problem with the property was the presence of mold and dampness in one of the rooms. Because of this problem, I bought the property and 25 percent below market value. I solved the problem with the help of a building specialist, and as a result, I could increase the property’s value and charge
Learn To Invest and Make Money Using The Junkie’s Secret
The more intensely we feel about an idea or a goal, the more assuredly the idea, buried deep in our subconscious, will direct us along the path to its fulfillment. -Earl Nightingale Where do you expect me to get the money to invest? . This was the question I got from a recent conversation with a long time friend of mine. Charle’s and I have been friends from Medical school. We meet and talk frequently about investing and becoming wealthy. I am of the opinion there are always opportunities to invest, as long as you have the right mindset. Charles is the pessimist , he always comes up with reasons why investing is risky . He is all doom and gloom about the economy. He sees stock market investing as risky and feel you could lose all your money investing in real estate. The interesting thing is Charles complains all the time about how he is not financially free…sound familiar? Charles’ view and those of many others on investing bothers me.. because of the enormous opportunity available today for wealth creation globally. Why do many people including myself, fail to act on our investing goals? How is it we make plans to start a wealth-building plan…but they never seem to get it off the ground. How can we overcome these limitation and barriers to investing? These questions bothered me and I kept on searching for answers… I think I found one…in a very unusual place. I found the secret from the observations of often reviled and denigrated underclass in our society…. Junkies or drug addicts… I first read about these observations in an article written by Michael Masterson. Introducing the Junkie’s secret In his article , the pledge Michael Masterson identified 3 essential traits , that junkies tapped into to fund their drug addiction: They worked long hours daily compared to the average worker. They worked 18 to 20 hours daily They worked with a single-minded focus. Junkie focused on only one thing every waking day … how to get the next fix and worked with only this goal in mind. In contrast, the average person would have a dozen interest and ambitions, which pull them away from their goals. The junkie is never diverted from his goals Junkies have a deeper emotional drive to succeed in getting their next fix. Their desire is much stronger than you and I’s ambition to become wealthy. Moreover, because of this deeper emotional drive, they would do whatever it take to get going in accomplishing their goals. The 3 essentials traits of success If you study the lives of the most successful in America, you will discover they share these traits They worked long and hard Stayed focused on one goal Made the necessary sacrifices to succeed You too can tap into these traits , to learn to invest The Missing link I think the first two traits you can easily develop. However, the missing trait for most investors …is the ability to make the painful sacrifices to succeed. Yes you can work hard, I know you can set goals to invest and plan for wealth. However can you make the necessary sacrifice to save money, borrow money, find the right partners , pay or find mentor to guide you and help you achieve your dream of becoming wealthy? I f you have read this article to this point I know you want to find the answer and the key is to… Find the core desire within you to invest and fan it. Somewhere within you is a core desire to be loved, appreciated and to succeed. It is always very strong. If you fan the flames of your core desires, the fire will grow. In addition, this will translate to achieving the success you yearn for. Listen to your heart….why do you yearn to be wealthy? I know my reasons why…what are yours? You have to find the burning desire within you to become successful. And you will have to use it to achieve your dreams to be a successful investor. It’s damn hard to start a business, start saving up for your real estate investing, or to really break away from your past. The reason is that it is different. In addition, it requires you to stretch yourself beyond your comfort zone. If you want to achieve more than you have ever achieved, you have to be willing to do more than you have ever done before. You need to commit yourself to stay focused, put in the hours, acquire the necessary skills to become wealthy. You need to do that challenging but necessary task. If you can tap into your burning desire, then you will become a success megalomaniac. Do you have this secret? If you have then it’s…. Action time Are you ready? Okay if you are…Pretend for a moment that your life, the future of your children and spouse depends on accomplishing your investing plan. What would you do -if your life depended on it- absolutely positively to succeed?If nothing else mattered, (failure is not an option), what is it that you would do? Now ask yourself, why aren’t you doing that? You need to get your doubts, objection and fears out and face them surely. If you can face your feelings squarely, deal with them fully and honestly, you will have overcome the greatest obstacle for many investors. You will find yourself achieving more, and you will surely end up living your dreams. To your success Think rich and grow rich Akin osho
7 Beginner Investor Efficiency Mistakes And How to Overcome them
Efficiency is doing things right; effectiveness is doing the right things. Peter Drucker “This is not good use of my time”, I thought aloud, wading through the sea of unopened letters on my desk. The whirring sound of the shredder was increasing my growing frustration. I glanced at the long list of tasks to accomplish. I had only accomplished one task out of the many tasks for the day. I looked at my watch; it was time for my viewing appointment with the real estate broker. The phone rang just as I was about to leave the house…it was the agent. I apologised to him, I was running late and rushed out of the house before I lost another investment opportunity. Have you ever had a hairy dog day like the kind I just described? I am sure you have. This is what you face constantly when you start out as a beginner investor; it is usually the need to balance your full time job, family life and the desire to become financially free. The greatest challenge for many investors and entrepreneurs is not in knowing what to do, but in doing what they need to do efficiently and productively. The 25 minute Question, that generated $25000 A true story of how Andrew Carnegie paid $25000 to Ivy Lee an efficiency expert should drive home the importance of efficiency. Mr Carnegie wanted to improve the productivity and efficiency of his staff in his factories, so he hired Mr Lee to solve the problem. The techniques Mr Lee taught the steel baron and his staff produced outstanding results that Mr Carnegie paid $25000 for his services. Now if a billionaire can pay 25k for a 25-minute advice on how to achieve more…How about you? A few years ago after I made the decision to become a wealthy, I found it an uphill task to get the most important tasks done in one day. It was as if I needed 26 hours out of 24 hours. The process was a time of learning but I was able to identify common mistakes investors make when they set out to achieve their goals. Mistake#1. Not writing down your goals and tasks This is a common mistake in terms of achieving your goals. A goal is a dream with a time limit. If you cannot clearly write down your goals, you are likely to fail. I find that if I start the day without a clear objective of what I intend to achieve, I end up doing tasks that I should not be doing in the first instance. Solution. Start everyday writing a list of tasks based on your goals and objectives, you should then prioritize your tasks for the day. Do your most important tasks first because they will have the greatest impact on accomplishing your major goals. You can use a journal or 3 by 5 index cards to keep track of your task for the day Mistake#2. Frequently checking your emails. Email has changed the way we communicate, because you can get instant replies to questions or send memos quickly. On the other hand, I think emails have become very intrusive in our lives and you could spend the whole day checking emails and fail to accomplish your important goals for the day. You must avoid getting into the habit of responding to all your emails at every whim. Solution. Set time daily to check your email emails. If you are using email for work, you could create a separate folder for emails from your superiors. As a good rule, you could just skim through the headlines of your emails routinely or just leave your checking your emails until the end of the day. Here is one thing I now do routinely…. I ignore most of my emails.Most people who need to get me know they can phone me if it is urgent. Mistake#3. Multitasking Mary Ellen Tribby says focus and concentration is an essential skill for entrepreneurs. I had an epiphany moment with her last year when she said, “Concentrating on 1 project with one dollar is better than 4 projects and zero income” I agree with her. It’s better to do one task at a time. The result of multitasking is never accomplishing your goals. Moreover, this is a major cause of failure and frustration for most beginner investors Solution.You should focus your time and attention on doing your most important tasks daily. Resolve and promise yourself you must do the most important task first daily. Another way to avoid multitasking is to group tasks together; you can set out time to return your phone calls, and then create another time to reply your emails. When you group your tasks in this way, you will improve your efficiency. Mistake#4. Not choosing a suitable work planner Most entrepreneurs make the mistake of having a fixed work time like the typical 9 to 5. The truth is the days of 9 to 5 work is over and this applies to you as an investor. I am assuming you are probably working full time, so you need to put in extra hours to work your investing plan. You see, not having your own plan sets you up for failure, because you will end up spending time doing other peoples’ work and not enough time on your own work. Solution. Draw up a planner that incorporate your investing activities and suits your style of work. Your style of work should enhance how best you function…for example, I am an early riser and I enjoy the solitude of writing and working on my business in the morning hours, before everyone else wakes up. You may be a night owl, one that works best at night. The bottom line is to find your most productive hours and work on your business at those hours. Mistake#5. Not planning your work “Have you confirmed or phoned to see if he is there? Is the first question my
Investing for Beginners-The Secret To Becoming A Wealthy Investor
When you are starting out as an investor you can get inundated with how to start. There are tons of mutual funds, millions of stock….. to add to your confusion you get bombarded with infomercials on the next business opportunities and…… spammed with emails for investing in the ” next millionaire internet opportunity” Heck ! how do you wade through all these tons of information.? I must admit it could be daunting but easy to do. The editors at MSN Money put together a Beginners Guide to Investing. The beginners guide listed the following steps…. Determine how much you plan to invest Choose one mutual fund or build a portfolio of funds follow a guru open an account and get started The problem with this guide is that it only talks about mutual fund investing…..diversifying into mutual funds it also wants you to follow a “guru” , whose performance is unrelated to his canny skills in investing. I think this is the worst form of advice an investor can ever get and…. it only serves the interest of Wall street who advertise in MSN money. This brings me to my next point…..how to get wealthy starting out as a beginner investor. I think above anything else you need a change of mindset. Why should you change your way of thinking?… because what the media and Wall Street is selling you about wealth is wrong.. The decision to become an investor involves a change in mindset By this, I mean the way you think. When it comes to thinking about investing the ultimate aim is… wealth creation In addition, wealth can also be unencumbered value. I had the privilege of attending a Seminar organized by Michael Masterson, bestselling author and Founder Early to Rise.com He classified wealth as any activity or venture you invested in that gave you equity… wealth was is directly related to having assets. Before we go on lets quickly look at what wealth is not… Wealth is not… Having high income Having physical possession of luxury cars Owning a self employment business Your personal house However, wealth is having Financially valuable skills…we will talk about more about that in my next post Equity in a business Rental real estates Intellectual property and licensing rights liquid savings in the bank Marketing skills The important distinction about wealth is that you have…. assets that add value to your net worth. How does an investor recognize the subtle difference… It’s by having a rich mindset? Here is what my criteria is #1. You recognize reality that every time you become aware of investment opportunity is an opportunity to make yourself richer or poorer #2. You have courage to take action and seize the opportunity #3. You can analyze the situation and make the right judgment I can easily apply this criteria to my last post on Donald Soffer You can see that he recognized that the marshland in Miami was an opportunity to get wealthy, he took action by buying the marshland and he developed a luxury real estate destination-ultimately becoming wealthy