Too often, I see people who want to start investing in real estate too soon. Everybody knows that real estate is a great investment for many reasons, but many people don’t know how to do it properly. Because of this, I see people invest in many different types of deals at varying results. The masters in the investing game are unreasonable about their investments and you should be as well.
As an inexperienced investor, you will see a lot of potential deals that all may look like a great deal. However, before you start investing, you need to analyze many deals and create your own requirements for investing. Those requirements should include things like your desired rate of return, location, how long you intend to hold the deal, knowing and understanding your exit strategy. If you are unsure of what any of these things are, then you definitely need to wait on investing and educate yourself before you get yourself into a bad deal.
Unreasonableness has been labeled a “bad” thing in our society. At the same time, the average person in this society does not have a high producing real estate investment portfolio. By being unreasonable, you will guarantee that you are only making the best decisions possible because you are basing all of your decisions in logic. This ensures that you make great decisions and look at the deal as a whole, and not just one part of it. Being unreasonable will ensure three things:
1. Cut Through the Noise
Knowing what your requirements are for an investment allows you to efficiently cut through the noise of the marketplace. You will be pitched many different deals from brokers, owners, capital groups and others, but by knowing exactly what your requirements are you can easily sort through all of this. What it also does, it gives you the opportunity to have agents search for deals within your guidelines and it cuts down the time wasted looking at bad deals.
Your personal requirements for an investment should be based on production, historical data, and proven methods. There have been millions of people who have made millions and billions in real estate. We don't need to reinvent the wheel. However, we do need to study and analyze how it’s been done before. With that information and knowledge of different markets and timing, we can start to build out your individual prerequisites. With that being said, we gain certainty that your portfolio will produce at high levels because of your unreasonably set requirements.
3. Make Money for Real
After you have cut through the noise and invested unreasonably with certainty, you will always make money. Warren Buffett's two rules of investing is to, “never lose money,” and the second is to, “never forget rule number one.” Finally, if you apply the above concepts, you will be able to produce income from your investments in order to create future investments.
At Precision Home Group, we help people sell their single-family homes and get into cash-flowing, income producing assets. If you want to learn more or continue to grow your real estate investment portfolio send me an email at email@example.com.