Thursday, February 21, 2013
Common Real Estate Investing Mistakes Stopping You From Being Successful
I have been investing in real estate, business and products for more than 19 years ago. And I have been teaching people how to invest and manage their business for just about 9 years old. Tens of thousands of people have received my systems, attended the event my benefited from our training programs. Over the years I have watched, listened and watched my students to see how we can help them to become better, faster. As a matter of fact, when you walk through the front door of our 12,000 square foot office building, just behind the reception desk is Alice, you will see our core values. Our number one core value is "we are not successful until our students are successful."
That being said, I have discovered 7 common mistakes that investors make to prevent them from being successful. They are:
1) Limited marketing
The first thing you need to realize is that you are in the marketing business. Real estate is a product and marketing business. The number one reason I am a student doing a bad deal is a lack of marketing.
Why? Because of the lack of effective marketing to a lack of leads come in. You get emotionally attached to make this deal, because it's all you've got to cook now. So you come up with reasons why this deal could work. This is called optimizing. When you begin to justify, you've lost. If you can not come back to your senses, go away!
2) Poor relationships
The sooner you realize this is a relationship business and you need more connections, the faster your business to take off. When a student comes to me and says, "my business is struggling and I'm not sure why," my first response is, "Tell me about your relationships."
How is your relationship with your bankers, brokers, management companies, private money partner, other investors, business partners, etc.?
If you want to evaluate the quality of the company, assess the quality of relationships first.
3) Analysis lack confidence
Many investors never get to the point of doing the important things they should be doing on a weekly basis to stay in business. That is, a set of offers.
We all know you can not buy a piece of real estate without putting in offers. So why do people not put in as many deals as they can? Or, why do not they put at least one offer a week? The reason is that they are not sure whether they have properly reported deal. They are afraid that they have made a mistake.
Get a loop network or realtor.com and start looking at properties and start generating offers. Whether it is a single or multi-family properties, you need to practice to generate offers. Then if you are not sure you did it right, have someone check it for you.
4) Net in the wrong places
You know you need a network to create relationships and to network at the right places to create the right relationships.
Here's how we can tell very quickly. Is your business getting what it needs from the relationship you have now? If not, change where you are networking and you will change your world business.
5) There is no plan
If you are not getting everything your business needs to get done to create that positive working capital cycle which is so important in any business, then ask yourself if you are working from a plan.
Are you spending time on Sunday night or Monday morning to set a plan for the week? Are you spending time at the end of each working day and / or at the beginning of each working day to write down the five most important things to get done that day? Then sit them?
If you do not do this, try it. There is one thing you can do now to increase productivity significantly. That's the reason it's on this list.
6) Limited education
Have you heard the expression "He knows enough to be dangerous"? That means you can be dangerous to your wallet because there are many mistakes you can make when you invest in real estate. The more education you get, the less chance you make a mistake. Education allows you to learn from the mistakes of others.
If you're learning from someone who says they have not had a bad real estate deal, you are learning the wrong person. Anyone who has been in the real estate business for any length of time, has had a challenging deal. This is how you learn. If you're smart, you do not make the same mistake twice.
If you're really smart, learn from the mistakes of others and do not make them yourself. You will make mistakes, do you just want them to be small mistakes, not big mistakes.
7) Lack of systems
The more systems you have in your organization, the more likely it is that you have a real business. Systems allow the business to run while you're doing two things that you should always be focusing on, to get the money and get a quote.
Some of the systems your business needs are: marketing system, detection system, offering system, block system, take over systems, disposal systems, employee system, contact management system, follow up system. I could go on and on. Indeed, the entire business should be systemized in order to succeed.
Either get a system that is already done and that you can incorporate into your business or get the book, "E-Myth Revisited," which will show you how to create your own system. Either way, get your systemized.