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Real Estate Investing for the Next 10 Years: If It Were Easy, Everyone Would Do It!

by Michael Zuber on September 24, 2012 · 13 comments

  
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Real Estate seems so simple; all you do is buy low and sell high, right?

Wrong!!!

Well, what about buy and hold investing or land lording? That’s simple, right? All you do is buy a property and sit on it for 10 years or so and magic happens, no?

Wrong!!!

Okay, but setting up a long term financial plan and retiring from your day job has to be easy, because all you do is buy one additional property a year for ten years and then boom you are done, right?

Wrong!!!

Real Estate Investing is NOT Easy!

This stuff takes work and it may take a little work from you every day for the next ten years if you want to be successful.  The question you need to ask yourself is: Can you work at something every day for 10 years before you see the fruits of your labor?  I believe a ten year plan is a great idea as it is long enough to see real results and not so long that it feels like a retirement party way off in the distance. 

If you are going to choose to be an active real estate investor or landlord, and work a full time job, then you need to realize that you are adding complexities to your life.  You will need to find time to research a market, meet new people and grow your network. You will need to figure out the variables that drive a good deal versus a great deal in your market.  Once you secure a property your life gets more interesting because you need to continue doing everything stated above and add to that the realities of being a landlord.  You need to turn units, manage tenants or property managers, and then deal with all the surprises that happen along the way.

Unfortunately, you are not done with the complexities of real estate investing.  Beyond all of the details above you need to realize that the market, financing rules, and government intervention are constantly evolving.  What works one month may not work the next month and if you don’t run a dynamic operation, you will get run over or lose out on the opportunity to leverage your success.

Looking back over my career in real estate, the one area I was lucky enough to take near full advantage of was the changing market.  We repositioned equity near the peak and then jumped in with both feet when the market had a fire sale in 2009-2010.  I bring this up now because I strongly believe we are in the middle of a strong inflection point in the market and what worked last year will not work this year.  If you did a deal already then congratulations but remember part of running your business is letting your strategies evolve with the market.

If you work at it every day for ten years then the riches and security of real estate investing can be yours.  I see my ten year investment in time, money, and stress as a great insurance policy or annuity.  I am near the end of my ten year investment timeline; how about you? If you are just beginning or thinking about starting, ask yourself if you can wait 10 years and invest time and money in your business every day.

Don’t worry if you say “No”.  In my experience most people can’t commit to something for ten years while staying engaged and fully committed.  They may have a good two or three year run but then they get distracted or cocky and things break or they miss opportunities.

If you are bought in to the 10 year time frame I wish you all the best.

Good Investing

Photo: Mario in arte Akeu

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{ 13 comments… read them below or add one }

Dale Osborn September 24, 2012 at 12:27 pm

Most of the time it does seem easy and you find yourself wondering why others are not investing in real estate. After 10 years, you start to see the benefits and may decide to kick back and start enjoying some of the nice side benefits. Or, you might jump in for another 10 years and find yourself set for retirement without having to continue working a JOB for the rest of your life. Real estate investing has its ups and downs, but in the long term, you tend to remember the good more than you remember the bad stuff you had to go through to get where you are now!

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Mike Z September 24, 2012 at 3:13 pm

Dale
I agree with you 100%. I am looking at doubling down the next 10 years!!!
Good Investing

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Mike Valerio September 24, 2012 at 2:57 pm

Nothing worth doing is easy! Great article.

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Mike Z September 24, 2012 at 5:10 pm

Mike

Thank You

Good Investing

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kimmgill September 24, 2012 at 5:51 pm

I agree with you Dale, however after seeing the condition of some so called managed property, I totally understand why people become disappointed and disillusioned and don’t want the hassle of owning investment property. My husband & I have bought & sold real estate for the last 30 years. The tried & tested ways that we have proved to be successful over this time have not changed. To start with, buy the right property, understand position position doesn’t mean that the property has to overlook the surf beach or that it doesn’t just relate to that one properties position position, it can relate to a part of a suburb or an individual town or simply worst house in the best street. Next, know and understand its potential from day 1, again potential is not just one factor set in concrete – it can mean its ability to be extended structurally or enhanced by landscaping or even just a facelift to improve street appeal. Whatever it needs to enhance its rentability to onwardly improve the standard of tenant and return which of course over your 10, 20, 30 year plan it increases its value and saleability, leaving you with multiple options to cover you for whatever scenario life’s deck of cards may deal. Last but not least and very importantly we have discovered is finding the right property manager let alone real estate agency that show the same foresight, passion, commitment & initiative that is needed and can be trusted to follow through with the systems we have put into place. Happy Investing……

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Mike Z September 25, 2012 at 10:32 am

Kim

NIce work. Keep it up

Good Investing

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Matt September 24, 2012 at 6:00 pm

another good article, thanks michael. would love to hear your thoughts on the coming years in the market….just a thought for your next article.

thanks again for sharing.

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Mike Z September 25, 2012 at 10:33 am

Matt

Thanks for the idea. Coming up with weekly article ideas is not easy

Good Investing

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Karen September 25, 2012 at 2:36 am

This article is good! It really gives me ideas!
Thank you by the way :)

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Mike Z September 25, 2012 at 10:34 am

Karen

Glad you like it and got some ideas.

Good Investing

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Sharon Vornholt September 25, 2012 at 4:14 pm

Mike -

Only the folks that understand upfront that real estate is a “get rich slow” plan will most likely hang in there for the long term. Great post.

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Frank R September 25, 2012 at 9:22 pm

What you owe today you will be worth tomorrow.

Frank

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Ali October 5, 2012 at 2:01 pm

Good perspective! It does take work to be a good real estate investor. It’s not difficult work, but you have to be educated on the aspects involved with what you are doing. With that said, things get sooo much easier when you find the right people to work with! Find people who are (successfully) doing what you want to do, and get mentored. Ask lots of questions. Then, make sure you have a rockstar property manager! I’d rather have an average property with an excellent property manager than the other way around, any day. But it’s up to you to seek out the rockstars.

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