Success is little more than the long-term outcome of following a set of simple, and often boring, sets of routine habits. Walter Bond (previously NBA crusher and now motivational speaker) say’s, “Success is a matter of following successful habits and rituals.” Have you thought about your real estate habits and rituals? Highly successful real estate investors share a set of habits. Understanding and adopting these habits will help to ensure your success. Begin your investing career on the right foot. Habits can make all the difference.
Tip the odds in your favor by having effective investing habits:
Successful investors have multiple advisors they trust. The members of the team will vary with the type of commercial real estate involved. An accountant, attorney, banker, title company, and mentor are standard. Contractors, business partners, and property managers might also be required.
Successful investors are focused. Find a niche and stick with it until branching out makes sense. If Single Family Homes (SFR) interest you, then stick with SFR. Apartment buildings are a viable option, too. But become an expert and maintain your focus in this area.
I had a friend that thought he was superhuman. He worked 90+ hours per week. His mantra was if it has to get done I’ll just work more hours. The more he worked the less time he spent with his family. He worked so much and then it happened things started falling through the cracks his confidence began to struggle. This friend would also take on new markets things he knew nothing about. He invested hours learning and did not get traction. It’s a mistake to spread yourself and your attention too thin, and this is really easy to do. Choose a niche and learn everything you can.
Successful investors stick with the numbers (Facts). Finding good deals isn’t easy. It can take months to find a good deal. Many beginning investors fudge their numbers out of frustration so they can finally do a deal. Get better at looking for deals instead of lowering your standards. Lowering your standards increases risk and the likelihood that you’ll lose money.
Successful investors never stop farming deals. Since deals take time to find, it’s important to always be looking. It can be argued that the real job of any real estate investor is to find deals. The rest of the team can handle the rest of the work. Spend some time each day making the necessary phone calls, reviewing the real estate listings, and staying on top of the market.
Successful investors have a long-term plan and follow it. What is your plan for the next 5, 10, 25 years? Are you looking to obtain a few good buildings or do you want to give Grant Cardone a run for his money? Your decisions are easier to make if you know your end goals. What are yours?
What short-term goals can be set to make those long-term goals a reality? Start with the end in mind and work forward to the present.
Successful investors create a strong and vast network. Many of the best deals are never listed nor advertised. Know who the players are in your market. Ensure they know who you are, too. Become prominent in your community and good things will happen.
When you find a deal that doesn’t suit you, pass the information along to someone else. Maybe the favor will be returned. Real estate is a people business. You can’t be successful on your own.
Successful investors understand that real estate is a business, not an investment. An investment is something that you can purchase and forget about for a while. A business requires regular attention. A real estate investor that attempts to treat his buildings as an investment, rather than a business, will struggle. You should be meeting with your property manager once per quarter for 15 - 45 minutes and 1 hour annually to review your entire portfolio. You should be networking and finding deals 10 hours - 15 hours per week. You should be working with your lenders and investment partners to provide the financing to continue to grow and scale your business. You should be meeting with owners wanting to sell their property 5 - 10 hours per week. You should be driving your property once per year. This is the work of owning your real estate investment business.
Real estate is a viable way to create wealth, but it requires time, energy, and commitment. Creating a real estate business is easier when you have effective habits in place. These habits help prevent disaster, keep the business running, and maximize profit. Consider what other habits would be helpful to adopt.