How to Not Get Killed in Real Estate
Real estate investing has created more wealth than any other investment in American history. To be a real estate investor, you need to master the skills of the entrepreneur. Most of our lives we are taught that the essence of successful entrepreneurship is self-reliance. Self-reliance is nice but you will not live long enough to accumulate all of the skills that you need to make real money in real estate. Why on earth would you even try?
There are a lot of tasks that investors need to accomplish in order to buy, rent, maintain, repair, and sell property. The most successful investors are not the people who have the most skill; they are the people who outsource the most work. You only have 24 hours in each day. If you want more than 24 hours of production per day, then you need a team. Each team is as unique as the individual investor who creates it. The team is like tools in the investor’s tool belt. You want the right tool for each task, and you want the best tools that you can find.
For starters, you need to understand the law. Actually that is not true; you need to talk to someone who understands the law. I suggest a lawyer. I further suggest that you choose a lawyer who specializes in real estate law and one who has a few years of experience in the field.
You also want an accountant who can tell you how to keep the largest portion of your gross revenue. There are a lot of rules here and there is not a single person on the face of the earth who knows all of the IRS rules. Look for an older accountant or one who works with a lot of real estate investors.
You are going to want to find a proper maintenance man or several specialists. Even if you think you know how to fix every household system, you would be foolish to do home repair yourself. A professional will be faster, better, and more cost-effective. Your time needs to be spent on tasks that only you can accomplish.
You need to find a teammate who can handle your sales and marketing. Everything that you do is sales and marketing. If you are looking for a home to buy, that is marketing, and a realtor might be the person to talk too. If you are renting your duplex out, that is sales. For this task, you may want to contract with a professional property manager.
Your main focus is on directing and communicating with your team, and then following up to be sure that all of the tasks are being taken care of. When you encounter a task that your team can’t handle, just add another person to the team. I just bought a property with a foundation problem. I added a foundation expert to my team as a consultant before I bought the property. In plain language, I got an estimate from a qualified foundation repair expert before I bought the property. My teammate told me what to expect and I was able to consider that information and adjust my purchase offer. There was no need for me to become an expert in foundation repair, I just needed to talk to someone who already had decades of experience.
If you are asking yourself how you will find all of these experts then you are starting to think like an entrepreneur. Find the shortcut, find the easy way, and model what others have done to be successful. The best place to find successful real estate investors is your local real estate investors club. These clubs exists all across America. Seek out the successful investors and ask them questions. Many of these people will happily share their keys to success with you. Many will even offer to connect you with members of their real estate team. I still use the attorney that my local mentor shared with me.