10 Kung Fu Habits of Successful Real Estate Investors

Posted on 15. Aug, 2010 by in General

“If you don’t want success, don’t take action.” Don R. Campbell

A few days ago I was listening to one of the REIN meeting CD’s that arrive in the post for me each month. There was one section in particular that really stood out for me – it was based around 10 habits that a select few successful REIN members have in common. These successful investors were not interviewed per se, but rather had a conversation with a REIN expert to determine what has made their business accelerate over the past few years. There are 10 shared common denominating habits that have set these investors apart from the rest of the crowd. These heavy hitters implement that extra 10% into their business that most people tend to overlook.

So, if you like average, stop reading now!

Note: If you only apply only 3 of these habits you’re well on your way to accelerating your business venture.
1) SLOW the heck DOWN!
I know, this doesn’t sound like a habit that will lead to success, but it most certainly is. The first year as a real estate investor or in any new business venture is a year for learning the basics and setting a solid foundation. The foundation can include a team (accountant, lawyer, realtor, home inspector, etc.) but also involves learning the fundamentals of your business. It’s awesome to be excited and enthusiastic about a new business venture but it’s too easy to set yourself up for failure without laying the groundwork in the first year. Don’t try and buy as many properties as you can your first year as an investor because this is when you WILL make the most mistakes. Honestly, do you really want negative cash flow, angry tenants, wasted joint venture capital, or any other mess that can taint your reputation? I know this is hard, but don’t compare yourself to other investors who may be buying properties at lightning speed. The only person that you can compete with fairly is yourself because you’re only in control of what YOU do, not what someone else does. Real estate is not a race. Also, never put another successful investor on a pedestal. They are human and will never live up to your expectations. Admiration and lavish praise of someone’s achievements is fantastic, but we are all human and we make mistakes. When you idealize an expert you are DISCOUNTING yourself!

2) Buy At Market Price.
Many deals have been lost when an investor starts grinding down the price and pinching at pennies. There have been fantastic deals lost over battles of testosterone concerning only $2,000. When you’re buying a property worth $300,000 than $2,000 becomes very trivial in the grand scheme of the deal. Besides, if $2,000 or whatever small amount is being battled over and your investment will not cash flow, it’s probably not a good deal to begin with. Don’t get caught up in the game of winning or losing. Trying to squeeze every penny out of the seller is NOT a smart way to do business. Do you think that the seller will speak highly of you and send you referrals after that? Absolutely not! If you are buying a piece of real estate the smart way, based on economic fundamentals in the right market your deal should always cash flow and appreciate in value OVER TIME. Invest in towns with a future, not a past.

3) Treat Others With Respect.
Don’t be a pitbull and think that every negotiation you enter into is a win-lose situation. Always leave something on the table for someone else. Creating win-win situations helps to create, build, and retain rapport with business partners, associates, and clients. Think karma. If an investor has tried to screw someone over in the past and ends up doing potential business with that person again, they will give you nothing, ZERO. Material possessions come and go but your reputation at the end of the day is one of the few things you can keep, so keep it CLEAN.

4) Run It Like A Business.
You can own 1 property or 100 properties so as soon as you start investing you have opened the doors to your business. This means keeping costs down while increasing revenue, having a smart marketing system, continuous education and personal development, having systems and procedures in place, book keeping, budgeting for contingencies, inventory, client services and focusing on CASH FLOW. Without this business mindset, vacancies will be higher with more tenant issues. Set your expectations with everyone up front. People cannot read your mind. Let your team know what you want for your business and how you want to run it. You must clearly communicate your vision. When you know you’re going to experience a vacancy (and tenants ALWAYS leave at some point) be prepared in advance. Have photos ready along with marketing copy to start advertising. This preparation allows you to be more creative with your marketing while reducing your urge to scramble at the last minute to slap an ad together.

5) Have An Agenda.
Many times people think of an agenda as a hidden intention but really an agenda is just a plan of action. PLAN YOUR LIFE. Know what direction you want to go so that when you are presented with various opportunities or sitting at a crossroad, you can confidently choose which path to take. Make your agenda a positive thing. Know what you want, plan for it, and take action! Life is going to happen to you anyway, so why not control it? Agendas help to manage expectations in your business. Let people know up front what you expect of them, your boundaries, and specific timelines. When you’re disappointed with someone else’s performance either your expectations have not been managed/set effectively OR you need to change your expectations. If you don’t communicate your expectations and know that the other person understands exactly what needs to be done, the problem then is YOU.

6) Celebrate The Journey!
Make sure to pat yourself on the back for doing the little things most people aren’t willing to do. Every time a deal is written, a vacancy filled, an offer accepted, a property sold, CELEBRATE! Go out for a nice dinner with someone you love. The joy of life is found in the never ending journey because often times you never get to the end. Don’t wait to live your life tomorrow, because you may not have that time. Reward yourself and cherish every step of the journey. What makes the journey extra special are the people who touch your life and accompany you on your journey, so make sure to always celebrate with them.

7) Be Willing To Walk Away.
It’s perfectly okay to walk away from a deal or opportunity even if it seems like the deal of a lifetime. Real estate deals are like the public transit; you may have just missed the bus but another one will be along in 15 minutes. There is NEVER a lack of deals or only one deal; there is only abundance. Learn to say “NO” to time sucking vampires (additional seminars, exotic deals, money making schemes). It takes a lot more effort to regain your focus and get back on track when you get distracted. Make decisions that get you closer to your preset goals, not farther.

8 ) Leave Something On The Table For Someone Else.
Especially when selling. Don’t hang onto a property and wait for it to reach market “peak” with the best interest rate possible at the highest dollar value because you’ll end up missing the peak. Let other people make money too. If you’re trying to sell your property quickly than selling at top market value isn’t going to make that happen for you sooner. If the property is a good deal and cash flows for another investor why not let them have a piece of the pie? You’ve made your money right? When you leave something on the table for someone else it comes back to you tenfold in many other ways in the future. Again, karma.

9) Choose Wisely With Whom You Associate.
The more uncomfortable you are in a situation, when the people you’re with are challenging you and pushing you to excel, the more often you should associate with them. Are you the best looking and most intelligent person in your group? If so, you need to find a new group of friends pronto. I’m serious. If you’re the top dog within your circle of influence you’ve reached the glass ceiling where up is no longer an option for you. In this situation, you will end up trying to raise others to your level and stop growing yourself. This becomes tiring. Personally, I want to be the dumbest person in the room. I want to be challenged. I want to surround myself with people who constantly raise the bar on me and PUSH me to do things I can’t even fathom. The least I’ll get is excellent education. Hang out with people who want to push you FORWARD, not hold you back. When others start criticizing you within your immediate circle of influence, your old friends, that’s when you KNOW for a FACT that you’re taking risks and being noticed. Good for you. In order to be successful the people you associate with MAY need to change. Negativity will only hold you back so why put yourself in a negative situation? Protect your confidence and do it Fiercely! Many times like attracts like because it’s EASY. Let’s pretend we’re molecules for a second. Electrons and protons attract each other because they have different charges so finding someone with complementary skills that are DIFFERENT than yours will create a synergistic partnership. One of the ways you can expand your circle of influence is to attend a new social event such as a product launch, charity event or silent auction. Don’t attend with judgment either. Be willing to meet and connect with people who you may not normally associate with.

10) Stick with YOUR System.
Why reinvent the wheel when what you’re doing is already working? Always stick with your system and become an expert whether your strategy is lease to own, apartments, joint ventures, using RRSP capital, etc. The smaller your niche, the more specialized you are, the larger your market share will be. Ignoring your system will only create chaos. Focus on YOUR plan. Real estate should not be exciting either so if your plan seems boring and repetitive that probably means its working. Real estate investing should NOT be exciting. Leave the excitement for other areas of your life. If you want excitement go skydiving. If you get easily distracted and stray from your system than your prize, your ultimate goal, may not be big enough to stay focused on.

I definitely like to keep all of these habits in mind in my own life. Sticking to these habits will get you farther along in the LONG RUN. Remember, this is YOUR business, YOUR life, YOUR journey so it’s up to YOU to incorporate these winning habits.

To Your Investing Success!

Richard Killeen-Payne

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