Does Your Profession Forecast Success in Real Estate Investing?
Are you a newbie considering Real Estate Investing and wondering if you posses the skill set and predisposition for success in the field? Hope this helps…
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People from all walks of life come into real estate investing and find success, which makes it difficult to make a generalization about what it takes or what prior training lends itself better than the rest to a successful career in real estate investing. Nothing of what I will say in this article is absolute; however, there does seem to be some logic to suggest that people coming out of certain professions may be more prone to finding success as real estate entrepreneurs than others.
What is Real Estate Investing?
If I were to characterize the activity of real estate investing in the most broad terms, I would have to say that real estate investing in all of its’ incarnations is an exercise in problem-solving, which requires us to receive numerous streams of data and to synthesize solutions based on all of the available data. Some of this data may be static in its nature which affords the investor benefit of time, while other events are real-time requiring constant adjustments.
As you can imagine, coping with the above mentioned realities requires a particular type of frame of mind, as well as mental and psychological predisposition – not everybody’s got it! To answer the question posed in the title of this article, we must identify professions which exhibit similar elements and require similar predispositions.
Synthesis vs. Deconstruction
Let us understand the essence of processes by which problem solving takes place – there are two: synthesis and deconstruction.
Synthesis is the process by which we take-in multiple informational inputs and synthesize a solution. This could be as simple as having to combine functionality with esthetics, or as complex as needing to arrange and apply hundreds of mathematical inputs. Synthesizing a solution requires deductive reasoning, and application of “if this than that” type of critical thinking.
As I mentioned earlier, synthesis is the problem-solving process utilized in real estate investing. Synthesis is also the basis of engineering, architecture, interior design and, in my opinion instrumental music performance.
Deconstruction is a process by which we deconstruct the subject into smaller components, which we study and gain command over, and then put back together to form a comprehensive knowledge base of the subject matter. This process requires strong memorization and organizational skills, but not necessarily reasoning. Here, in stead of questions, we are dealing with facts.
One example of a subject that fits into this category is history. Another, strangely enough, can be accounting, by which I do not mean a CPA which requires strategic thinking, but a straight forward “bean-counting” or audit which requires good organization and attention to detail but not necessarily strategic thinking.
Think of it This Way
Imagine solving a puzzle. Typically, you go to the store and buy a 1,000 piece puzzle; you lay the pieces out on the table and start turning them face up and matching one piece to the next. Depending on the difficulty level of the puzzle this can be very tricky indeed.
But, imagine if every time you turn and match one puzzle piece, two of the pieces you had previously put in place change – one step forward, two steps back. Not only does the level of difficulty increase exponentially, but the psychological conditioning necessary to keep up with the process becomes paramount. This illustrates the essence of Deconstruction in the first case and Synthesis in the second.
What Does This Mean?
Everyone knows that we choose professions and education which supports them based on our interests. But while this may be true, the less talked about reality is that we choose our field also based on our comfort zones.
As an accountant, are you comfortable being the go-to guy or gal for strategic planning, which requires you to assume some responsibility for the success or failure of the advice you render, or would you rather focus on finding and reporting mistakes that other people made? Both are important functions, but they certainly predicate completely different frame of mind and comfort zone.
Or, did you choose to become a musician because you hated math? Some musicians are quite logical about their craft in that they apply a fair amount of deductive thinking to the process of solving technical and aesthetic problems, and then synthesize the logical with the emotional components. Others are strictly emotional. Both can achieve success in the field, but obviously your success in music will not translate into success as a real estate investor unless you are comfortable with logic and numbers.
This is a bit of a difficult subject to write about due to it being rather abstract, but am I making sense? Nothing in this post is definitive, and people can certainly change and adapt when we commit to achieving success. But, there does seem to be some logic to suggest that your current career can serve as an indicator of your predisposition to success in the real estate investing world.
If you are a newbie first considering real estate investing, perhaps you can look to your career choice and accomplishments to give you insight as to your level of pre-disposition to real estate investing.
OK guys – it’s the Memorial Day weekend and I have to stop here. Please remember this weekend that the reason all of us can do what we do is because men and women gave their lives for it. As you are reading this, young people are standing on that wall protecting your freedom to make any choice you want in life – give that due weight!
Well, I am not going up for Pulitzer with this one, but did I get my point across?
Photo: Revol Web