How to Build a Grand Slam Strategy in Your Real Estate Investing Business
So, you bought a property, made some repairs, sold it for HUGE PROFITS….right?
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In baseball, all the players dream of hitting that pinnacle achievement of the grand slam, much like a pitcher aiming to throw a perfect game. Statistically, it just doesn’t happen that often. Here are some real stats from Major League Baseball:
- Years: 138
- Games: 204,931
- Runs: 1,855,308
- At Bats: 14,005,129
- Hits: 3,668,401
- Home Runs: 274,375
- Grand Slams: 6,357
So, you ask, what’s the point? This is a real estate blog, not baseball stats! Here is the point: in real estate, if you are only swinging for Grand Slams, you might miss a lot of opportunities to $core from all of the other potential runs. All properties, with a solid investment criteria, and that yield a healthy profit should be considered, even if it’s not going to put you on a Caribbean island for a 6 week vacation.
Working with Wholesalers
Much like baseball, you need to develop a pitch strategy. Whether you are a wholesaler or you buy from a wholesaler, you need to understand a few metrics. One strategy is the three strikes rule for the buyer. If you are a buyer of wholesale properties and you consistently see a seller that throws a curve ball of a property, then determine how long you will accept their pitches before they’re OUT! My strategy is three strikes and you’re out. Send three deals that have really bad ARV estimates or significantly under-estimated repairs and you’re wasting at-bat time. You’re out. Next pitcher!
Getting from Buy to Sell
A baseball game is like any other, with offensive and defensive strategies.
- Your offensive strategy should include several batters, or buying methods. Just as grandma told you not to put all of your eggs in one basket, you should not rely on just one batter. Diversify. You may have a slugger, who brings in the homeruns. You may have a tried and true that consistent gets on base and is brought around to score. Translation: Wholesalers, Realtors (that understand investors), Bird Dogs, etc.
- Your defensive strategy should include several fielders, or professionals aiding in the process. Some can catch those obscure deep right field balls (think Lawyer), and some catch the tried a true throws to first base (title agents). Or the catcher that deal will all that gets thrown it’s way (CPA). You must arm yourself with a successful team of players working towards the same goal, and win when you win.
Arm yourself with the right team players and you are sure to win the game.
- Be Informed Like a MLB Stats Machine – Wow, are there a LOT of stats available about Baseball! True to form, there are just as many articles and blogs about successful real estate investing. Spend some time on the BP. Get into the conversation. Post questions and answers. Nothing quite beats the confidence builder of being able to answer the questions of others. Turn that confidence into cash.
- Swing The Bat! — You must eventually swing the bat, or you will consistently strike out and miss out on all of your potential. The flipside to #4 is that you can have analysis paralysis and never get a deal. Swing the bat. Make an offer. Have your dealings in order and make a deal. Share your successes, just like the MLB stat machine.
Photo Credit: Tyello