Real Estate Investing Principles: Using Focus to Build a Solid Business Foundation

by |

In last week’s blog post, I talked about the basic principles of building a Real Estate business.  Principles are like the foundation of your home.  If the foundation is not sound or is made of poor materials, you will be forever repairing the house.

Your business is the same way.  Building it on fly-by-night ideas and get-rich quick schemes will prove to be fatal and will not bring the results that you want.  On the other hand, if you pour a solid foundation on true principles, then whatever you build on top of that foundation will last and produce for years to come.

Fellow investors and aspiring investors — it is paramount that you know what true principles are.  Do not be duped into incorporating someone’s opinion as a principle in your life and business!   To know the difference between a fly-by-night principle and a true principle is not difficult.  Experienced investors have applied true principles to get where they are at.  Read their writings and counsel with them and they will impart the wisdom of true principles.  

People selling you something usually attempt to get you to bite into fly-by-night ideas that will flare up quickly and then die out.  True principles are likened to marinading and false principles are likened to microwaving.  Building a business takes time, energy, and lots of hard work!

Let’s look at one more principle that will help you take your business to the next level:

Be a Laser, Not A Flood Lamp – When you go fishing in a lake, you don’t put just any type of bait on the line (unless you just want some quiet time).  You find out what bait works the best to catch the fish you want to catch!

In a very competitive market, you have to become a specialist in what you are doing.

Just saying, “I want to flip houses” is too vague nowadays.  You have got to dial in your desires and say, “I want to flip 3 houses this year in South Austin in the median price range of $150k.”  You need to start there and work your way backwards, putting together a plan to achieve that goal.  You need to have a “laser” focus and niche.  Trying to become a jack-off-all-trades in real estate investing is only for the experienced investor that has built their business on solid principles.  Yet even the experienced investor at times needs to pull back and focus their efforts to be more effective.

If you are starting out like I was, your marketing budget is not very big and you need to make it work well for you or else!  This is when being a laser and not a flood lamp will help you.  Once you have dialed in the people you want to reach, shoot a laser at ’em.  Make the marketing piece as specific and personalized as you can.  It will typically take more time but a lot less money.

We ran a letter campaign for several years where we would drive through a neighborhood we wanted to flip in.   My wife would write down the addresses of the houses that looked distressed as I would bark them at her.  We would then go home and use the public tax roll to get the name and address of the owner and send them a personalized letter with a handwritten and stamped envelope.  This marketing would cost us only about $55 per 100 letters (plus gas for driving) and consistently gave us a 3% conversion!

Mass mail marketing campaigns will bring results, but the conversion rate is lower and you will catch “all kinds of fish”.  Decide what your niche or two is going to be and then be intentional about becoming an expert in your area.  As your business grows, it will naturally flow into other areas of real estate techniques and modes.

There will always be a temptation to become a flood lamp, so work hard at being LASER FOCUSED!

There are many other true principles that you want to build into the foundation of your business.  This has just been a short list.  Find an expert in the niche that you want to work in.  Read their writings, talk to them if you can, and look for the principles that they have applied to their business to become what it is.  There is probably at least one expert right here on BiggerPockets!

Photo: Steve A Johnson

About Author

Jason Grote

Jason Grote, co-founder of of, has been involved in real estate investing for 10 years. Through his experience, Jason has gained the expertise to sell a home fast and can also help people wanting to begin investing in Austin, Texas real estate.


  1. Jason – thanks for providing this information. I am interested in the business but I have not gotten started yet. As I’m going through BiggerPocket’s articles one by one, they are really helping me plan to do things in chronological order. I am a young investor – 23 years old – so finding a starting point is a bit difficult right now! After reading about the 10 niches, I’m so far interested in 1-4 unit multifamily homes, and rehabs. The next step for me is connecting with people in my area who I could get hands-on experience with.

  2. Jason Grote

    Congratulations on starting your investment career early! As you take actionable steps, your niche will unfold. You will begin to gravitate towards one or two. Connect with investors in your local area and begin to learn what you can from them. Keep us posted on your progress of course! Thanks for the read.

  3. Elmer Foster on

    Thanks Jason, this information has provided the direction I have been looking for in terms of how to go about taking the plunge. I have been so “scatter brained” with trying to initiate the buysiness in so many different ways that I have not been able to initiate anything. Now I know.

  4. Thank you for this article. There is so much information out there, the term “Analysis Paralysis” seems like a huge obstacle. But focusing on the parts of real estate investing that intrigue you the most, and learning as much as you can about that niche, instead of trying to learn everything, can get you right around that seemingly-huge obstacle. And I suppose by deciding which niche to start in would give you a good idea of what roads you would really enjoy. It is not set in stone that you will have to choose right now what you will do forever. Very good, thoughtful article. Thank you!

Leave A Reply

Pair a profile with your post!

Create a Free Account


Log In Here