8 Tips for Investing in Real Estate
I follow a guy named Brandon Turner. He is huge in the real estate investment world - young guy - and actually owns something like close to 8,000 properties now. So he's a prolific real estate investor!
He came up with eight tips that he wished he could go back and tell himself when he was getting started in real estate investing. I thought they were really good. I wanted to share them with you.
1) Eliminate Bottlenecks
He says there are three bottlenecks that stop real estate investors from finding like a lot of growth. The first one is finding the deals. Second is financing the deals and and third is managing the deals. So get obsessed about continually breaking through whichever one of those bottlenecks that you happen to be in in that moment.
2) Investing is a Team Sport
Real estate investing should be a team sport. If you end up linking up with somebody who's really really smart at what they're doing, make sure you either create a joint venture with them, or hire them because this is supposed to be a team sport. Rather than getting 100% of what you can do on your own, get 25% or 50% of 10x what you could do on your own! So run the numbers there: that's really smart advice!
3) Master the Marketing Game
This is critically important because I think this gets to a lot of the "finding the deals." You have three components to doing real estate investing: finding the deals, financing the deals and managing the renovations/properties. You need to bring at least one of those to the table. And I'll tell you the hardest one isn't the financing piece of it like many folks think - it's finding the deals. So get really good at mastering your marketing and find those deals; you'll become an invaluable partner to the anyone who can bring the cash or manage the projects/properties.
4) Work for Someone Else
This is such good advice. This is one of those things that I wish I would've done when I was younger. Brandon said that his ego - I think like a lot of our egos - says that we feel like we need to do it on our own, alone. And the truth is if we had just spent one year going and working for somebody else who was a decade ahead of where we were currently at, we would automatically be leveled up to their level with just working for them for a year. So invest the time and exponentially ramp yourself up much higher than you would be, further along the investment game, than if you you start from square one and do it on your own.
5) Track Everything
This is just a good business advice in general, but track what you do. At McDonald's, just as an example, they have a cheeseburger down to a science. They know how much the bun costs, how much the burger costs, how much the cheese costs, the condiments, all the way down to the half a penny, so that they know exactly what they need to sell it for so that they make money. All business should be run the same way. And property investing is the no different. Track how many offers you're making, how many deals you've analyzed, how many deals you've put together, how many other people you've met with, how many other investors you're meeting with. Track everything because all of that just plays into the fact that business is a numbers game, whether you're selling cheeseburgers or you're investing in real estate.
6) Growth Happens Outside of Our Comfort Zone
Grow exponentially outside of your comfort zone. The tip that's given here is don't acquire properties one by one. The idea is grow one door, then two more, then five more, then a 20 unit building, then a 50-door portfolio ... grow exponentially. Because one of the secrets is of the folks that do a lot of property investing is that it's actually easier to do some of those bigger deals than just the single doors. It's easier, it's more fun. And believe it or not, you've got it in you to do it!
7) Pick the Right Mentor
This one is probably my favorite. It is hard to grow beyond the level of where your mentors currently are at. So wherever your mentor is, they're going to bring you up to their level but they can't take you any higher up the mountain because they've not been there themselves. You're going to have to continually level up in the folks that you're surrounding yourself with - the mentors that you're hiring - in order to get higher up that mountaintop to ultimately where you want be.
8) You're Your Own Worst Enemy
Another that's just good business advice. The biggest thing that's holding you back is ... you. You are the biggest thing holding you back. It's all a mental game, guys. Everything is impossible until somebody does it, right? Nothing is possible for you until you decide that you're going to do it! Don't go into this thinking that you'll never be somebody that can own a 100 rental properties or a 1,000 rental properties, right? It's absolutely possible if you link up with the right people, you get the right mentors and you get the team surrounding you to support you in that goal, you can absolutely do it. So get out of the mindset that you can't because you absolutely can.
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