SUCCESS! vs. FAILURE!
As they say, there can be a fine line between the two. Many new real estate investors want to get into real estate but they don’t know how. There are also those that want to become real estate investors but they don’t have the money to get started. Wholesaling real estate can be an option that requires little or no money down. It is always a good idea to verify any and all laws you may need to comply with in your local area. An Attorney that specializes in real estate is always an important part of your real estate investing Power Team.
People often ask me why some people fail at wholesaling real estate. The obvious might be that everyone puts the same amount of time and effort to succeed. In life, people want success but they don’t want to put in the effort that may be necessary. It’s like an example of someone wanting to lose weight. Some people just want a magic pill to lose weight rather than watching what they eat and exercising. Sometimes, there are no short cuts to the real work to reach success!
I have compiled 10 reasons why I have seen people not succeed with wholesaling real estate:
BELIEVE AND ACHIEVE!
So often in life the biggest person that might hold you back from success is yourself! Do not talk yourself out of doing it or listen to others. So often in life we listen to negative people offer FREE advice but do not get discouraged because they are not going to help you pay your bills! You can do this, yes you! You have to start out by believing you can succeed. You have to believe that you can make this work and work in your local area. Work on this and your confidence will grow. Complete that first deal and you are on your way to making it happen! Envision what it would feel like to close that first deal! What would the negative people say then?…….. “I believed in you the whole time!” Really?????
TIME, TIME, TIME
Yes, in real estate we hear the most important thing is all about LOCATION, LOCATION, LOCATION! With real estate investing it’s all about putting in the TIME, TIME, TIME! Life can be so crazy busy that there is often not enough hours in the day. If you want to succeed at something you have to put in the time. Each day you have to carve out a few hours and put in the time. Real estate wholesaling involves finding the best deals and finding cash buyers. Each day you have to be laser lined focused on these two items.
LASER LINE FOCUS
How do we eat an elephant? One bite at a time! How do we do a real estate deal, one piece at a time! Try not to focus on too many things at one time. Each day you really need to take it step by step and focus on one thing at a time. To succeed in real estate investing, you need to find great deals. With real estate wholesaling you need to find great deals and find cash buyers. That is your focus each and every day. How can I find the best deals and how can I find and network with cash buyers that are ready and hungry to buy!
You need to create a plan for what you are trying to accomplish. You want to be sure you use your time as effectively as possible. It is critical you have laser line focus with what you are trying to accomplish each day. A plan for your daily and weekly activities is a must.
EDUCATION ABOUT YOUR MARKET
You need to put the effort into understanding your local real estate market. You really want to become a student about your local area, what types of properties real estate investors are buying and what areas of town are known as being the hot or upcoming areas. Put in the time to really learn your market and when you find a deal in those areas, you are more than half way there!
CALCULATING THE ARV -After Repaired Value
Most new real estate investors struggle with calculating the ARV – after repaired value. What does ARV mean in plain English, you might be asking? It is the amount the property is projected to be worth once the investor does the renovation and puts the money into the property to make the property fresh and updated. Often neglected properties can be dirty, nasty, stinky, and crusty! That is why the seller could be motivated to sell for less than market value based on the current condition of the property. A realtor can provide you with sold properties that can be used as a comparable or “comps” for short to assist you in determining projected value of a similar property you may have an interest.
RENOVATION, REHAB, REPAIR OR REMODELING COSTS
No matter what you call it, you have to know your numbers. Repair costs can vary from state to state, so put in the time and effort to make a trip to your local home improvement store and learn what it would cost to update a kitchen, bathroom, flooring lighting, etc. The best calculated offers may turn into the best deals when you know your numbers!
The best deals come from the best analysis. What would make this an attractive deal to the real estate investor? Price of course, but what about the location or amenities of the property? Could a large yard and oversized garage be a potential bonus to the prospective buyer? Could a property that already has a new roof or HVAC unit appeal to a buyer? Analyze the numbers but also look for things that could appeal to a buyer.
THE TWO TALES OF THE GREAT NEGOTIATOR
A great negotiator wants to make both parties walk away from the table feeling like they got a great deal. A great real estate negotiator wants to establish relationships and a great reputation. Make sure you are a great negotiator when you put the property under contract to BUY the property but also you need to be a great negotiator when you SELL the contract to a cash buyer.
CLOSE THE DEAL
Often new real estate investor’s negotiate a deal but fail to close the deal with the seller or buyer. Make sure you move swiftly to get the deal in writing and have all parties sign the documents. If you drag your feet in getting a signed written contract with either the buyer or seller all you hard work could be lost with a deal that falls through. Don’t let this happen to you and see the deal all the way through to the end. If you close the deal, you will be happier as you are taking more checks to the bank!
Final Thoughts – Conclusion
I know many people that are new to real estate investing have a dream of becoming successful in real estate. I see this as I mentor people from all over the country. Sometimes the most difficult deal is getting that first deal done and understanding how to continue to build your knowledge and effort after that first deal. Always make sure you are smiling because real estate investing is so much more fun than punching a clock at a 9 to 5 job. Real Estate Investing can be a great way for you to take control of your future if you are willing to put in the time, energy and effort. Good luck on your real estate investing adventure! Believe and Achieve! – Joe Jurek
ABOUT THE AUTHOR:
Joe Jurek is a Real Estate Investor, Author, Public Speaker and Consultant. Joe has worked with hundreds of people throughout the country and provides consulting to new and experienced real estate investors alike.