Zero Drown

www.InvestorDirector.com

The glamorous facade of popular “zero down” real estate books have pushed many hopeful investors into deep waters – without first knowing how to swim…

Most top-selling real estate “gurus” and authors stop investing in real estate to focus on writing and selling glamorous books and courses. Other popular wealth authors have secret pasts marred with failure in real estate and realized they are better at writing real estate books that get readers excited; to buy more of their books and courses! Their business is not real estate investing; nor is it the business of teaching others how to properly invest in real estate. Instead, their business is the highly lucrative trade of information marketing. Few people know that nearly every mainstream real estate investment book contains nothing more than generic recycled information and flat out fallacies from authors that are either years removed from the business of real estate investing, or from authors that couldn’t make ends meet as real estate investors.

Expert investors know that viable real estate investment techniques are constantly changing based on ever changing financial and credit markets; you’ll never see expert investors using glamorous mainstream books and courses as reference guides because these sources of misinformation cannot be published fast enough to keep up with current market trends. Any successful investor will tell you that failure is guaranteed without correct information, strategies, and business plans tailored to one’s current financial situation, geographic area and market conditions. Receiving the right information is the key ingredient to every investor’s success.

Flawed thinking

As I was becoming a real estate entrepreneur, I devoted countless hours to learning all I could about growing wealth in real estate. I read over 40 of the most popular books and courses, joined several real estate investment associations (REIA’s), traveled to regional and national seminars and spent thousands of dollars on information that I thought would help me grow wealth. With all of the information I gathered, there was always one underlying theme that these books, courses and infomercial-promoted seminars taught:Try to find residential real estate under market value to buy, using fancy techniques and with no money down. Then rent these properties to tenants for a slight monthly cash flow and do it again until you’re rich. So I did this…and like many investors I know who also prescribed to this plan, I nearly went bankrupt. I am not saying all mainstream books, courses and seminars for real estate investors are bad. Many contain good nuggets of information. But the glamorous informational products the general public buys into aren’t fine tuned to suit various locations or the unforeseen market conditions like those of today.

Investors must understand two things about the multitude of mainstream real estate books and courses:

1. Most real estate books and courses are written to motivate the reader, not teach them the necessary information to make a lot of money. Many books and courses are intentionally written to motivate readers, rather than teach readers the dynamic world of investment real estate. This leads to more book sales for the author because readers develop a hope of wealth attainment. It also keeps readers addicted to that particular author, and is in fact strategically planned by the author for sales purposes. A lot of people spend a lot of money on these information sources (even becoming “disciples” of certain authors and lecturers in some cases) because they get addicted to their inner feelings of hope generated by these books and courses. This only develops a false sense of wealth attainment for readers, who then go out and make big mistakes. The only one making financial gains in this scenario is the author.
2. The books and courses most readers buy are out of date, over generalized and cater to the “weakest link”. Popular mainstream books and courses that are currently being marketed generally teach the same old tired information that anybody can understand:Buy and hold a 1-4 unit rental home using “zero down” techniques for a tiny cash flow, perform a lease-option with a buyer who wants to rent while trying to get financed for an eventual purchase, or buy a garbage home and try and rehab it for easy “quick cash”.These authors and gurus have readers acquiring real estate without unraveling the DNA of a real estate deal, without teaching them the numbers that make a deal work in their specific area, without planning proper exit strategies or without having networks of people set up to help them succeed. Information that is so primitive, vague, and unrealistic could never take anyone into the upper echelons of real estate investing.

Everyone likes reading that they can become rich. Unfortunately this false sense of hope that readers develop by reading popular wealth books, causes them to go out in the field and make big mistakes.

The most common mistake I see new investors make is ordering an outdated and oversimplified course from a glamorous late night TV infomercial and doing just what it says: Buy a home with nothing invested, rent it and do it again until you’re living on a beach making money. Buying a home with nothing down and holding it long term can be a good thing, but it has to be done right – and at the right time in an investor’s career. Real estate is a specialized business – a generic overview won’t work. I had four friends that went bankrupt in less than a year because they became “late night TV investors”. They bought into generalized information and a hope of getting rich, rather than learning from successful investors in their area. They didn’t have the relevant educational materials necessary to establish a profitable and reliable business system – and it cost them big.

When a sports team does bad but has enough talent to win, management fires the coach. Performance is a function of knowledge and execution. Look at the performance of real estate investors – especially over the past five years, and it becomes abundantly clear that the authors of books, seminars and courses we see advertised are factors that really helped to magnify our modern day real estate catastrophe. Investors tried to practice what many mainstream books and courses teach, but their overall performance was horrific. That’s because the wealth authors set them up for failure by selling a glamorous dream rather than sound investment education materials. Scores of excited and willing investors spent thousands on glamorous books and courses…all to lose out. Would these investors have failed if they received the right information and executed accordingly? Absolutely not.

To evaluate the backgrounds of many of the most popular real estate authors, go to: www.johntreed.com