Some investors are struggling to make it in today’s market.
They can’t find deals…
They can’t find private lenders…
They can’t find good contractors…
They can’t find good tenants…
They are paralyzed with fear and can’t pull the trigger…
What is the difference between investors who are struggling and those who make it to the big-time?
Here are 4 secrets of real estate investors who are making it big in today’s market. You can use this as your roadmap to success this year.
Network and Relationships
Are you surprised this is #1 on the list? Your network and relationships are more important then ever before. Jim Rohn said that you become the average of the 5 people you spend most of your time with and he was right on point. Who are you spending your time with? Are you hanging out with negative neighbors and doubting friends who don’t believe you have what it takes to make it investing?
Your network can help you find deals, fund deals and create long-term cash flow. Are you using a network of bird dogs to bring you deals? Do you have an extended referral networking bringing you deals? This network can include wholesalers, realtors, your hairdresser, bartender, mobile home park manager, payday loans manager and so on. Build your deal finding network carefully, tell them the kinds of deals you are looking for and reward them when they find you a smoking hot deal with a ton of equity!
Your network and relationships can extend to your financial friend network. These are the people you call when you find a deal that has to close lightning fast and you don’t have time for a loan officer, appraiser and under-writing! Build this network, train others how to participate in your deals and reward them with great returns when they come through for you!
Buy houses based on Numbers and Not Emotions
A lot of new investors get caught up in the emotions of a house. They see the property with elements such as historic charm and character and then they know they can restore it to its former glory. That’s an emotional approach. The most successful investors don’t go there! They buy real estate purely based on numbers and the opportunity presented with fixable problems, value added strategies and the upside cash flow and equity in the deal.
There are four must-know numbers before you buy houses:
- Price (and seller financing terms)
- After repair value (ARV)
- Cost for repairs
- Market rent
If you focus on these numbers, you will find success by leaving your emotional ties to a house or neighborhood behind you. Think and act like an investor, not as a homeowner, when buying investment real estate. Focus your efforts on executing an acquisition that will lead to success for your exit strategy. These basic numbers take the risk out of real estate. You must internalize them, know them with confidence and develop an acquisition strategy based purely on hard numbers!
Invest for the Long-Term
Everyone has choices to make with their time. You can work for income with a w-2 earning job or even as a self-employed professional such as an attorney, physician or private practice owner. The problem with just focusing on income is that you pay maximum taxes and most people spend what they earn.
The best investors in the world spend a lot of time investing in assets that create cash flow and boost their long-term net worth! Would you invest your time now for many future paydays in the form of net worth, equity and monthly cash flow?
Investing in hard assets that create cash flow, potentially appreciate, and provide great tax benefits are where the most successful investors are focusing right now.
Be a Lifetime Learner
“Investing in yourself is the best thing you can do. Anything that improves your own talents; nobody can tax it or take it away from you.” Warren Buffett
Warren Buffet got this one right! No wonder he is such an incredibly successful investor. You need to learn what they do not teach you in school! The essence of creating cash flow starts with a motivated seller who is willing to exchange their equity for a fast sale. The skills you learn as a discount home buyer are priceless!
Learning to listen, negotiate and carefully craft great offers will lead you to investing like the best investors!
Committing to the process of being a lifetime learner will allow you to operate in all markets that go up, down or sideways. Take the time to read as many books as you can, turn your car into a mobile classroom and listen to your favorite podcast (FlipNerd). Commit to attending live events and networking with other like-minded entrepreneurs. Build your network and relationships to surround yourself with others who will help you achieve great results!
It takes time and commitment to succeed and the process starts with invest in yourself but it is one key that separates the average investor from the highly successful investors!
The difference between the best investors and those struggling are often times small tweaks in approach, strategy and network. Are you ready to move forward with confidence and build your investing future?
You are in the right place here on FlipNerd!
Written by: Jim Ingersoll