BiggerPockets

Contrarian Real Estate Investing...

For the most part I have considered myself a savvy and yet contrarian real estate investor. Not unlike those "professionial" investors in the financial world who are selling when others are buying and buying when others are selling.

Historically, I have mostly invested in areas where most investors were not investing… at least not in droves. And the one time I did invest where many real estate investors, mostly speculators, were investing... my business took a $100K bath.

LESSON LEARNED… Stick to my CRITERIA!

Getting back to this contrarian point of view… Over time I came to realize that this "renegade" approach to real estate investing was actually serving me extremely well. And even though I didn't realize the full impact, all positive, the decision to sell all of our properties in 2006, I went against the flow… and sold when others were still buying and as a result profited handsomely from that decision.

I call that…

Even a blind squirrel finds a NUT once in a while…

Yet, that experience has served to further reinforce my contrarian point of view!

So… the investing fundamental is this…

When others are buying perhaps you should be selling…

And

When others are selling you should be buying…

And it appears that many people, residential homeowners and investors alike are in the position through a combination of poor purchasing methodologies and getting into purchase loans that are too expensive for them… have and are being forced to sell!

Also caught up in this situation are lenders who know soonner or later they will have to liquidate their Real Estate Owned (REO) inventory. They can't hold it for ever!

For those of us who are in a buying mode at this time, and if you are serious about this business... you should be... here are a few fundamentals that will help you to ensure your profits and acquire properties in a disciplined and profitable manner.

In short, do the following… OFTEN…

1. Invest in neighborhoods that the CROWD has not found…
2. Purchase only using well thought out CRITERIA…
3. Master the science of the Numbers…
4. Profit when you buy…
5. Obtain financing using commercial techniques…
6. Run your business as a business… (Not a series of individual deals)
7. Buy when others have to sell…
8. Sell when others are buying…

These are just some of the basics which have served me well and I know that they will serve you equally as well because they will keep you focused on the basics!

To Your Success...

Pete

Comments

• 

  Ted Harris — over 2 years ago

  Au contraire Peter ... I like it. Enjoyed your article and great call on selling in 06'!

• 

  Peter Giardini — over 2 years ago

  Ted, Thanx for the feedback. Pete