BiggerPockets

It's kind of crazy how the economics of things always seems to even things out. One demonstration of this is the concept of â"barriers to entry.' I remember when I was back in school and this was just some business vocab word, but coming through the real estate battery and seeing many of our members struggle with it, it seems to have its place.

All the time i see investors get hung up on a certain aspect of investing, some buy courses and never put together a deal while other investors buy a course and slingshot themselves into a deal. The difference between these two types seems to be that some people are more savvy at taking on barriers to entry than others and many of those barriers are mental.

Real estate investing isn't rocket science, doesn't require an sort of degree, but certainly does involve an effort... especially at the beginning. But really in its own way it is a good a thing because it keeps the pool of investors at a reasonable size, enough to keep opportunity alive for the active investors.

I think when we find ourselves stuck on something it's in its own way a good thing because it thins out the heard. If others aren't doing it because they are stuck or unable to get something set up, then you have an advantage in the market. Not to say we're all adversaries, I love the team work that takes place in real estate, but when you're sitting at an autoresponder with writers block it's nice to know that the extra effort means something. :)

Ryan

Great post.

I got into wholesaling right when the market started taking a nosedive. I had a heck of a time in the beginning, and it took me over a year before things finally started to click. Even though that was one tough year, now that I look back on it, I'm glad for the struggles that I went through. I'm pretty sure most people would have thrown in the towel, and it feels good to have persevered and made it through the learning curve.

Steph

The last eight months presented a "shock to the system". Lots of investors and mainly mortgage brokers knew that the bubble is going to burst, but were in denial. Other didn't believe it would burst at all, and the general retail home buyer, The Joes and Janes of America, didn't even know there was a bubble. Many of whom jumped on the gravy train of the early and mid 2000's now in foreclosure shock and some of them swear they'll never own a house again in their life. This new reality makes it actually a healthier socioeconomic environment. It allows landlord to provide quality housing and also enough properties for those who do want to own affordable homes. Sort of a balance, if you will.
As for those who are "get rich quick in real estate" dreamers. They are who they are - dreamers. They dream, they don't envision and those are two different type of people.

And then off course, there are those who afraid. Afraid of success, afraid of failure. Whatever fear they succumb to, they wouldn't do a one move unless they are absolutely positively sure that they are doing the fail-safe move. Sure there's no such a thing. There are always variables, unpredictable factors, "Miscellaneous items" like in any other part of life. This process of weeding out the unfit, leaves the world of real estate investment more balanced.
We REI are all different. Some are more ambitious then other, some or more competitive then others, and some are just better sale people, but in the end of the day, we all love what we do, we always wish we could do more if we just had more money to do it, and we all thrive to succeed and learn. That what set us apart.

Absolutely Shaun, the barrier to entry ultimately boils down to the static between the ears. I'm a big fan of this down market because some how by the grace of God I mentioned to stay at least par, and everything else is just more interesting.

Innovation is born of necessity :)

Originally when I wrote the post I was considering the risk vs reward, effort vs. reward btw short sales and reos. Then it just took on a mind of its own.

But revisiting the idea it makes a lot of sense to be aware of the barriers when we're considering the motivations of others because the barriers will in some way, shape, or form leave an impression on the result of motivations.

A barrier could even be applied to sellers who can't get over the hope that god or obama is going to save them.