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Is There an “Easy Button” in Real Estate Investing?

by Sharon Vornholt on January 28, 2014 · 30 comments

  
No Easy Button

I had someone ask me a question recently about getting started in real estate.

She was losing her job and wanted to know which course to buy so she could replace her income quickly.

Getting another job just wasn’t something she wanted to do.  She was definitely looking for the “Easy Button”.

This particular question and her personal dilemma just opened up a whole bunch concerns for me most of which she was completely unaware of.

The Traveling Seminar Gurus

I had to tell her that there was no course that she could buy and study from beginning to end, that would prepare her to replace her current income immediately.  This gal was so disillusioned. And if the truth be told, she really wasn’t so sure I was correct in what I was telling her.

After all, everyone says you can make a lot of money with real estate investing with no previous experience, and little or none of your own money down.  She then went on to tell me about how easy it looked on all of the shows on TV.

And … she had just attended one of the events in her city that the “traveling seminar folks” put on. The problem was that she just didn’t have the 5 figure investment required to make her dream a reality. If only she had the cash or big credit card …..

I told her that making that big investment with absolutely zero experience was a terrible mistake.

Related: The Guru Trap: How it Works and Four Ways You Can Avoid It

You Have to Invest in Yourself

I am a big believer in investing in yourself. Most successful real estate investors I know personally have spent a great deal of time and money on their education.  Sure you can skip this part; and years from now you will be exactly where you are today or close to it.

But there is a time to shell out your money on for this education and spending well up into 5 figures when you have absolutely no experience is insane.

I asked this woman if she belonged to her local REIA. She admitted that she wasn’t a member and had not attended a single meeting. She just didn’t see the point in joining. After all, she hadn’t bought any property yet.

Then I asked her if she had read any books, blogs or visited any sites like BiggerPockets which are all free resources.  You can guess what the answer was. I guess she wasn’t much of a reader.  She was just looking for the “Easy Button”.

You Have to Start at the Beginning

The simple fact of the matter is that there is a path you need to follow for success with real estate investing. You have start at the beginning and do the things that constitute “Learning real estate investing 101”.

I am talking about things like:

  • Joining your local REIA, there is always value in these groups.
  • Reading books, blogs and sites like BiggerPockets
  • Attend a few no cost or low cost weekend seminars
  • Quit watching TV every night and listen to one of the many free webinars
  • Sign up for one of the many free live Q&A calls like the one I’m having this week

Take advantage of all of the basic things that are available to you at no cost or at a low cost. These things are part of your initial learning process. Then you can move on to more advanced programs.

Take a Field Trip.

The next thing is to actually get out of the house and do some “research”.  Here are 3 things you can do:

  1. Visit open houses. Spend some time on Sunday afternoons and go look at houses in your target areas. You will get to know the neighborhoods, learn what houses are selling for in those areas, and you will make some contacts with real estate agents or even possibly real estate investors in the process.
  2. Do some “driving for dollars”. If your marketing budget is next to zero, put some gas in the car and take a spin. Pay special attention to your target neighborhoods and be on the lookout for vacant or abandoned properties. Jot down those addresses and send those folks a simple postcard. You can pick up blank cards at any office supply place.
  3. Look for houses being rehabbed.  See a dumpster?  While you are driving, stop by any houses that are being rehabbed and introduce yourself. You never know what opportunities you may find to network with other investors.

When you are just getting started, the biggest investment you should be making is with your time. Spend your time wisely in the right places, and you will reap huge rewards down the road.
Photo Credit: josémaría

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{ 30 comments… read them below or add one }

Brian Gibbons January 28, 2014 at 10:37 am

Hi Sharon,

It is hard for newbies.

A few points…

If you just got the books for being an Agent (every state and even state’s region has unique conventions) and studied those, you would know some inside information on REI. You don’t have to take the test, just have the info.

And you did the 100 house rule”, walk through 100 properties, took pictures and notes, to understand value and points of difference. Follow through to see list vs sold price, or if the listing expires.

Go to REIAs and pass out a “I Buy Houses” card and get in the game. You can’t play if you don’t market.

Great article! :)

Reply

Sharon Vornholt January 28, 2014 at 4:06 pm

You are absolutely right Brian.

You can’t play if you don’t get in the game. The important thing is to just get started. We all make mistakes. You just need to pick yourself up and move on. Hopefully you have gotten enough education so that your mistakes just “sting” a little.

Sharon

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Brian Gibbons January 28, 2014 at 4:10 pm

To be truthful, Sharon, I make mistakes even being in the game since 1986, but I make fewer of them then I did starting out.

Having a coach and being on Bigger Pockets helps minimize mistakes.

Reply

Sharon Vornholt January 28, 2014 at 4:13 pm

Brian -

We have both been doing this a long time, but I have made my share of mistakes for sure. Sites like this are great for learning, but I am a strong believer or coaching. It helps you grow so much faster. Thanks for your comments.

Sharon

Roy Schauer January 29, 2014 at 8:34 am

One of the things I did was watch particular houses and follow them from the time they were listed until they finally sold, since some were preforeclosures until they were either bought at auction or reverted to lender. It takes time but gives you a better feel for your local market of what’s going on.

Thanks for the article Sharon. I was one of those ready to make things happen overnight people about 2 years ago. Lol!

Reply

Sharon Vornholt January 29, 2014 at 9:35 am

Roy -

That would give you a good feel for the market. And don’t feel bad; in the beginning we all want it faster then we learn the secret. It’s a process that just takes time.

Thanks for reading.
Sharon

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Greg Jackson January 28, 2014 at 11:25 am

Terrific thoughts Sharon,

BiggerPockets as you mention is a terrific resource, both written content and the podcasts. For example, I’m finishing up reading, “The Millionaire Real Estate Investor” by Gary Keller (great book), which Darren Sager recommended (BP Podcast 048). I also listen to the podcasts in my car to make best use of “drive time”.

Thanks! Greg

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Sharon Vornholt January 28, 2014 at 4:08 pm

Greg -

I need to read that book again. I like to listen to things like that in my car too. One of my friends calls it “his university on wheels”. I love that saying.

Thanks
Sharon

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Kevin Yeats January 28, 2014 at 1:48 pm

Sharon, you gave a perfect answer.

Greg, I like you comment too.

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Sharon Vornholt January 28, 2014 at 4:09 pm

Kevin -

I’m not exactly sure what you are referring to but thanks!

Sharon

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Kevin Yeats January 28, 2014 at 5:50 pm

Sharon, the newbie wanted an easy method of make a lot of money. You told her there is not an easy method.

Or as a friend told me. “the easiest way to make a small fortune in business ….. start with a large fortune.”

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Sharon Vornholt January 28, 2014 at 7:27 pm

Now I love that Kevin. “Start with a large fortune”. Isn’t that the truth!

Sharon

John Thedford January 28, 2014 at 4:22 pm

Thanks for the article. People interested in becoming landlords should join their local REIA, talk to other investors, and ask lots of questions before they jump into the game. They will soon find out there is no glory in dealing with overflowing septic tanks, deadbeat tenants, and thousands of other potential problems. If there was an easy button we would all be living the high life:) Real estate is not a get rich quick scheme. It is a commitment like any other business.

Reply

Sharon Vornholt January 28, 2014 at 7:29 pm

John –

Not everyone is cut out to be a landlord, and I applaud those that can do that. It’s hard!

One of my friends calls the business of buy and hold the “get rich slow business with a lot of crap along the way”.

Thanks for reading.
Sharon

Reply

Nasar January 28, 2014 at 6:00 pm

Sharon,

I give people the same advice.. This Article is perfect. Of course you have people selling dreams and those who are looking to buy dreams. These type of people are looking to buy dreams. They think finding that motivated seller will be so easy. Well its simple but not exactly easy…
Great article

Reply

Sharon Vornholt January 28, 2014 at 7:33 pm

Nasar -

That’s it in a nut shell. It’s a simple business at it’s core, but it’s not always easy. One thing I know for sure is that if you stick it out, this business sure is fun and rewarding along the way.

Sharon

Reply

Yuliany January 30, 2014 at 1:31 pm

Hi Sharon,

You are so right about this. I know many people who would rather watch reality shows than reading up for their knowledge. Success doesn’t happen overnight without hard work. People need to realize that what they focus on will expand, if they focus on watching TV they will have a wealth of knowledge of reality TV stars. So far I can’t think of how that type of knowledge can be useful in achieving financial success. Maybe if they are planning to produce their own show :)

Anyway, I enjoy reading your posts. Please keep posting we need to learn more from people like you.

Thank you

Reply

Sharon Vornholt January 30, 2014 at 2:48 pm

Yuliany -

Thanks so much for your comments. Most folks think entrepreneurs are kind of a crazy bunch. We do strange things like work and learn in the evenings instead of vegging out in front of the TV. I love real estate investing, but no one ever said it would be easy.

Thanks for reading.
Sharon

Reply

Klee January 30, 2014 at 4:09 pm

Sharon,
Thanks for the great post! As a newbie the points you listed are great tips. I’m more concerned with learning at this point and not as eager to jump into any deals until I learn more. I guess I prefer to make less mistakes than those who are more eager to jump into deals rather than educating themselves or being coached.

I most appreciated you “take a field trip” tips.

Klee

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Sharon Vornholt January 31, 2014 at 9:01 am

Klee – That is a great way to approach it. You need a certain amount of learning. Just don’t get stuck in the “learning mode” forever. At some point you will need to take a deep breath and just jump in.

Sharon

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Klee February 3, 2014 at 9:38 am

Sharon,
Thanks for the advice! I know I keep telling myself that, don’t get tuck in the learning stage. I will be attending a few local group to find a mentor to start showing me some hands on approach.

Klee

Reply

Jordan Thibodeau February 1, 2014 at 7:53 pm

Great post! Starting in July of last year I decided I wanted to purchase an investment property. I reviewed all of the BP articles I could get my hands on and listened almost every BP podcast. Once I was armed with that information, I visited 100 different properties, which helped me to define my criteria. In December I was able to purchase my first property.

One thing I would say to noobies (like myself :-) ) make sure you preview as many properties as possible before you pull the trigger. It’s way too easy to fall in love with the first property you see that comes close to your criteria. Don’t deviate from your criteria until you have mastered your niche.

Reply

Sharon Vornholt February 2, 2014 at 8:12 am

Jordan-

You made a really important point. Newbie investors tend to fall in love with properties, and then try to make a deal work by using “eraser math”. They will run the numbers then start changing them to make the deal work. Bad idea!

Investing is a business, and it is a numbers game. Nothing more. You really have to take the emotion out of it and just make a business decision every time.

The other point you made is that there is no substitute for getting educated. Study, read, and go look at lots of properties. It will save you from making bad decisions early on.

Sharon

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Shaun February 2, 2014 at 11:25 am

The key to overnight success is years of hard work.

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Sharon Vornholt February 2, 2014 at 6:06 pm

I totally stealing that Shaun. And that is indeed the answer.

Sharon

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Shaun February 2, 2014 at 9:15 pm

Feel free! :)

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Rachel February 3, 2014 at 8:31 am

Great title for a topic, Sharon!

Maybe in the future, there will be an “easy button” but for now having the passion and knowing oneself is definitely key to any business endeavor. I’m an example of this! Without knowing myself, I probably wouldn’t be where I’m at today.

I think sometimes us seasoned folks forget what it’s like being new and “green” to the game. We were all there at one point but I think experience helps us to see the light and keeps things “real.”

It’s great to see the idealistic goals of new folks. Though, many times putting thoughts to action becomes an issue (especially when they learn this business may not be as “easy” as it seems).

No matter how much I read, there’s always something new I learn from experience. It says a lot. But, I’d never have the experience if I didn’t go out and do the things I did including making the mistakes I made.

Many are scared of making mistakes but it’s important to know it’s all a part of the game. In my opinion, learning from mistakes is much more valuable than doing nothing and making no mistakes at all.

Investing in yourself is definitely high up there on my list. I think self development is so overlooked in our field. But, it’s knowing oneself that allows one to see what they like/don’t like and how they operate as a person.

Good tips for the new folks out there, thanks for sharing!

p.s. Every year I write a journal. I pulled out my journal from my first year in this business the other night. It’s interesting to see how my perspectives have changed over the years with the experience gained! :)

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Klee February 3, 2014 at 9:50 am

Rachel,
You are so right! Making mistakes as a newbie is my greatest fear, but I guess I have to look at it as my life experiences I made mistakes to learn from them. I am a very purposefulful person in that I need to make sure I know what I’m getting into (educating myself and getting coached) and then I’ll jump in and manange the mistakes as they will come.

P.S. I like your idea of journaling you experiences, I may have to steal that idea… :)

Klee

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Sharon Vornholt February 3, 2014 at 10:30 am

Klee –

I really believe that there is really only one thing that ultimately separates those that succeed from those that don’t, and that is the willingness to just “feel the fear and do it anyway”.

Sharon

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Sharon Vornholt February 3, 2014 at 10:28 am

Hey Rachel -

Those are all good points. And I think you are right. It is just plain overwhelming for all of us especially when we are new. I was just doing a Skype call with my VA. He is traveling in another country for business now with his “day job”. But he told me that he outsources too.

When I mentioned how hard it is to “give away work” he told me to check out a free tool that he uses. All of us learn from each other.

Every year I learn so many new things, and at times I still struggle with some of these things like everyone else. Each time I am reminded of that time when I was brand new. There is just no way to escape the mistakes and the struggling part. That is after all how most of us learn.

I love your journal idea. I have spent time journaling from time to time, but not as a regular practice. I think I need to do that again. This year is especially busy for me. I have lots of plans, and most of these things will be new to me. Oh how I wish there was an easy button at time. But I know that I need to do these things myself the “hard way” so that I can learn them myself. Thanks for your comments as always.

Sharon

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