Real Estate Investors Association of Greater Cincinnati

Think back for a minute—what was your first thought the first time you saw one of those handwritten signs at the highway entrance? You know, the one that says, “Handyman Special Must Sale [sic] $87,000 555-5555”? Or the first time you saw a bandit sign that said, “I Buy Houses Close in 7 Days”?

Unless you happened to have encountered one of these messages for the first time after you’d already started studying real estate, your reaction was probably a mixture of:

• Suspicion (“Is this for real? Who tries to buy houses by putting a sign on a telephone pole?”)
• Confusion (“Handyman’s special WHAT? What are they trying to sale [sic] me, exactly?”)
• Mistrust (“How can they possibly buy a house in 7 days when it took my bank 45 to close?”)
• Curiosity (“Who puts these thing
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Back when I first joined my REIA, there was an experienced investor named Ralph who always wore these buttons that said YAFTAX.  After perhaps 6 months, I finally worked up the courage to ask him what that meant, and he said, “sound it out”.

After a few tries, I got it: You have to ask.

His point was, don’t walk around being confused by my button. Ask me. Don’t walk around being confused by real estate. Ask someone.

So fast forward (mumble mumble) years to yesterday, when I had a really interesting conversation with a really new investor that FINALLY made clear to me the full meaning Ralph was trying to convey.

This new investor mentioned that at some of our 'deal' meetings, she'd listen in, write down any terms she didn't understand, and google them.

The example she gave was, "I didn't initially know what it meant when people said, 'I have a 3/2'."

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When I was 2 or 3 years old, my mother took me on trips to the library almost every week. While she checked out the latest mystery novels, I always went to the same shelf in the children’s section and pulled down the same worn, tea-colored book called “I Can’t, Said the Ant.” I must have made my mom check that book out 50 times. I had every word memorized, every illustration emblazoned on my brain, and every character befriended in my daydreams.

In case you missed out on this epic, the basic plot is that a teapot falls off the counter and breaks its spout, and if it isn’t put back up, it will die some horrible teapot death. All of the denizens of the kitchen—from the dinner bell to the pie to the pot—beg the (oddly, single) ant in the kitchen to get the teapot back to the counter and repair the broken spout.

Much rhyming ensues (“I can’t bear it, said the carrot” is one that still sticks with me), and ultimately, the ant, who initially, as you might guess from the title, doesn’t see how he can manage it, rounds up a work crew of insects and rescues the unlucky teapot from the floor.

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As you can imagine, I meet a LOT of real estate entrepreneurs every year.

And something that I’ve noticed about many of you, including newbies and old pros, is an energy you give off that I can only describe as clenched-upness.

Even folks who are excited, on the surface, about starting or expanding their real estate businesses are often simultaneously radiating a sort of anxiety about the whole thing.

Yes, I understand that what I (and your sellers and buyers and private lenders, by the way) am really feeling is your underlying fear.

Whether it’s a fear that you’re being sold a bill of goods by all the folks (like myself) who tell you that there’s unimaginable money in real estate, or a fear that it works but you can’t do it, or a fear that you WILL succeed and then be judged because you have money and your friends and family don’t, it’s definitely there—at least in most people that I meet.

But there are others, and some of them ARE brand new, who are JUST excited, because (sometimes in the face of all evide
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Let’s face it: making deals complicates our lives.  

When we first become involved in real estate, buying a property can be very anxiety-provoking: I mean, really, even though we’ve done all our due diligence and run the numbers 15 different ways and talked to our favorite mentor about it and it STILL looks like a great deal, how do we ever REALLY know? And this leads to self-esteem problems, as we’re constantly second-guessing ourselves and berating ourselves over our lack of confidence. 

And even for seasoned investors, taking on a new deal is stressful—an accepted offer means that we have to find a buyer, or start a rehab, or put an ad in the paper to get a tenant. Plus, there’s the additional bookkeeping when the checks roll in, and, of course, the taxes to pay on the profit at the end of the year… 

Since stress and anxiety lead to psychological and medical conditions, including high blood pressure, overeating, bad hair days, fear of success, and a whole host of others, making deals should obviously be avoided at any cost. So, I think it’s important, for the sake of our own health and well-b
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There’s a dark secret that many investors know but that no one seems to talk about much. It’s a secret that every full-time investor eventually discovers for himself or pays the consequences. 

To illustrate, let’s take 2 imaginary real estate entrepreneurs, Investor A and Investor B. For the sake of simplicity, let’s imagine that both investors start from the same place. Same income, same credit, same skill level. Then, both attend a real estate conference one weekend in hopes of finding a way to quit their jobs in short order and become full-time real estate entrepreneurs. 

The story of Investor A 
Investor A latches on to a landlording course. He’s attracted to the idea of building wealth and loves the tax-advantaged nature of rental properties. On Monday, he sets out to build a rental empire that will allow him to become financially independent in short order. 

“A” is very successful in finding under-priced rentals in his hometown. His typical deal looks like this: 

ARV:     
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When you’re doing your first few deals—or doing your first few deals in a strategy that you haven’t explored before—you need help.

Maybe it’s help evaluating the deal. Maybe it’s help with negotiation or contracts. Maybe it’s help understanding how to ‘price’ the rent or sale price. Maybe it’s help understanding how the financing will work. But you’ll find yourself needing advice from people who’ve ‘been there, done that, got the T-shirt’ over and over again throughout your real estate career.

This is no small matter; it’s easy to lose a deal (or worse yet, do a bad one!) because there’s ONE hangup. ONE question that needs to be answered or ONE problem that needs to be overcome

1-4:  EVERY Friday morning at our online Haves and Wants meeting. It’s very common for members to attend with the “Want” of “I need someone to walk me through how to do this subject to deal I found” or “Can someone help me with evaluating a property I’m trying to buy?” and to get assistance either then and there, or later
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I was having a discussion this week with leaders of 12 real estate associations about why:

1. “Small investor sentiment” is way down right now. Surveys are showing that nearly half of small rental owners and rehabbers think that this is a bad time to acquire properties, find deals, invest etc.
   
   
2. But at the same time, REIAGC members are finding, buying, holding, and flipping deals that are PROFITABLE ones, even when viewed in the light of a possible downturn

When I’m hearing one thing but seeing another, I get curious. So I asked this mastermind of 30 or so very experienced, long-term investors what THEY thought the difference was. See if you agree.

Most small investors, like 99%+, have a single end-to-end strategy for ‘doing” real estate that looks like this:

1. Find deals “On MLS”
2. Finance them with conventional, DSCR, or Hard Money loans
3. (a) Rent them at market OR

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     I see it every day: budding entrepreneurs who have the EDUCATION to get going and (at least say they have) the MOTIVATION to get going but don't do anything today, tomorrow, or the next day that's likely to GET them going. It's a brain lock that we ALL get about certain things at a particular time, and it's about the fact that creating an entire real estate business from scratch is just too overwhelming to deal with.

     I ran across this article that I want you to read if I just described YOU...I think if you follow the advice here, you can get over that hump and on to the job of getting successful, one day at a time.

     It's called "How to Actually Execute Your To-Do List, or Why Writing it Down Doesn't Get it Done." http://zenhabits.net/how-to-actually-execute-your-to-do-list-or-why-writing-it-down-doesnt-actually-get-it-done/

     What do you think? How do you motivate yourself to do boring, difficult, overwhelming, unpleasant things?

One of the critical questions that beginning  and intermediate-level real estate entrepreneurs struggle with is, “How do I know when it’s the right time to hire help?”

I’m not talking about VA-type help here; your lowest-level administrative work (sorting lists, looking up names in the public record, etc.) and your high-skill but non-real estate work (designing logos, creating websites) can be quickly, easily, and above all CHEAPLY farmed out to VAs practically as soon as you understand what that “work” is.

I’m talking about “inside team”—people who work with you on a day-to-day basis, who understand your business more deeply than an outside team member like a VA, who may, by necessity, be ACTUAL rather than VIRTUAL employees.

THIS decision—bringing actual “staff aboard” is always challenging. It seems as if the point at which your business grows to where it’s difficult (or impossible) for you to keep up with the day-to-day activities does NOT usually coincide with the availability of a ton of extra income to pay an employee.

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