My last article titled A Call To Action, discussed a program the Government is planning to implement that would allow very well funded and connected large businesses the opportunity to purchase bulk REOs owned by various Government organizations –effectively cutting small real estate investors out of the REO market.
At the conclusion of that article I offered a few suggestions of actions that each of us as real estate investors need to take to both protect our business and start to speak as a stronger voice both locally and nationally.
The cold hard reality is this: real estate investors as a group are not viewed positively within many communities, by politicians, and often times, our customers. It is my strongest belief that this negative view is continually perpetuated because the only news regarding real estate investors is negative news — not news that shares the contributions we make within our communities, but news about how we are slumlords or worse.
And, We let this happen!
When we allow ourselves to think about our contributions within our communities, the fact is that real estate investors make substantial contributions and we need to make this information available to everyone. When we succeed in getting this message across, programs like the one referenced above will include real estate investors like you and me… and not just fat cats!
The contributions that real estate investors make within our communities
I am sure each of you can add at least one item to this list, and then we as a group can make our contributions know within our communities.
Here they are…
1. We take vacant, distressed properties, those not generating tax revenues, improve them, and get them back on the tax rolls.
2. We improve communities, often one home at a time — again, taking an eyesore and turning it into a liveable home.
3. When we purchase a property the following vendors all generate revenue from our efforts. a) Real estate brokers and agents; b) Title companies, title abstractors, title insurance companies; c) Appraisers and maybe even home inspectors; d) Lenders whether banks, hard money or private lenders; f) Fees and taxes paid to various municipalities. The amount of money moving from investors to these various organizations is substantial, and, think about the effects on your local economy when the owners or employees of each of these organizations get paid and then spend these funds within their community.
4. The financial impact of any one of our renovations is substantial. The funds we place into our community when we hire contractors, the subcontractors they hire, the materials they purchase and of course the fees paid to the local community for permits and inspections are significant. And of course, the impact of these contractors spending the funds they earned within their community is also worth noting.
5. Don’t forget that dollars go back to the real estate brokers & agents when the property sells and again the appraisers, inspectors, lenders, etc. is cycled through our community when we sell our properties. And, most importantly the funds that we earn as our profits are recycled back into our communities, which trickles throughout our entire economy.
6. If you are a landlord the funds paid to a property manager, or your mortgage payment, or the taxes paid every year make an impact. Every dollar working its way through your local economy improves the lives of everyone.
We make tremendous contributions within our communities. Above are just six, and I am sure there are many, many more. One of our jobs as real estate investors is to ensure our contributions are clearly defined and known within our communities. We must start now to change the negative perceptions held by so many, though.
I look forward to your additions to this list and more importantly to each one of you taking action to ensure your contributions are appreciated within your communities.
Photo: Chris Dlugosz
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Peter is an active and successful real estate investor in the Baltimore Maryland region for the past 8 years and is one of the founders of The Club Mastermind a real estate investing coaching program focused on local coaches helping investors to perfect their game.