Yesterday, I had one of those aha moments. You know, one of this moments where you either see something more clearly, or you get some additional information you didn’t have before, or you get smacked across the face because you thought you were doing the right things, but you weren’t.
My aha moment falls into the smacked across the face moment.
I am a Real Estate investor. I have learned a lot of things in my last ten years of real estate. The normal stuff, what to do, what not to do. What I prefer to own for my investments and what I don’t like owning and messing with. The value of a property manager, and how I am really not good at finding people to rent my properties.
This week, I am attending a conference. In my group is a guy that is a real estate investor. He has purchased a lot of properties throughout his lifetime. He has purchased big apartment complexes all the way to single family homes. He also just happens to be a former NBA basketball player as well, so that is cool.
As we are talking, I asked him a few questions that I have asked a lot of people. How do I buy bigger properties? Not just a duplex, four-plex, or single family homes. I am talking about 16 unit places, 40 unit places, etc. Much bigger properties that I am used to buying.
His advice was simple. He said it isn’t hard to find the money to buy these places, what is hard to find is the right deal. You have to find the right deal when purchasing these places. And finding the right deal is the hardest part.
The million dollar advice: He said, I made it a point to go around town and find the properties that I would like to own. Once I identified those places, I reached out to the owners and asked them if they would be willing to sell. He said, in many cases the owners weren’t wanting to sell. He didn’t stop there though, he then made it a point to cultivate a relationship with those owners and stay in front of them.
He said in a lot of cases that some of these deals would take two years, but he would eventually get a call from an owner of a property that said they were interested in selling now, and that he had the first right of refusal.
Now if you have read this far, you are wondering why this advice is worth a million dollars?
A couple of reasons. I haven’t been doing this. I do it the traditional way. I call up my agent, tell them what I am looking for, and then they go and see if it exists. I need to be more intentional about it like he is.
Secondly: I have been asking the wrong people for advice. Sure I have asked people who own real estate how to make these purchases. But in many cases, the people I have asked are very similar buyers to me.
What is the point. The two lessons are extremely profound. By cultivating relationships with owners of properties I would like to own, will set me up in the future if they decide to sell. Real Estate can be emotional. It is the old saying “one mans garbage is another mans treasure.” After a while, owners get rid of properties for a variety of different reasons. By having a relationship with these owners, I may get first right of refusal to purchase their property.
The other reason is this. I have not been getting my advice from the right people. I must ask the people who are at, or have been to the places I want to go. Period. I can’t ask a person who has never been a millionaire, on how to become a millionaire. I can’t ask a person who has never successfully run their own business, how to successfully run and operate my own business. I have to become more strategic in picking who I seek advice from and who I look to for mentorship.
To your success and your future.