One Easy Change of Perspective Could Vastly Improve Your Real Estate Business
“Money can’t be sought directly. Money, like happiness is an effect, and the result of a cause. The cause is service.” — Earl Nightingale
We real estate investors are essentially in the sales business. We sell our house acquisition services. We sell our leasing services. We sell our houses. We sell our credibility to lenders.
But there is a big problem here, especially for new investors. The problem is our perception of sales. What do you think of when you read the word “salesperson?” Positive vibes? Someone you’d love to be someday?
More likely you will think of a slick used car salesman. I mean, who really wants to be known as pushy, sneaky, and cheezy?
Of course, salespeople aren’t all bad. I happen to think selling the right product in the right way is an extremely honorable profession. As a full-time investor I sell something almost daily. If I don’t, I won’t survive or thrive financially.
So how will you succeed at investing if you hate sales or think investing takes advantage of people?
The following is the answer that has worked for me:
I’m not in sales. I’m in service.
When we serve someone, we feel good. Our brains literally produce the natural versions of morphine or heroin!
Service is not about getting. It’s not about me, me, me. Service is about giving. It’s about making sure the other person is taken care of.
Pause for a moment and just notice the good feeling you get thinking about serving someone instead of taking from someone. A business orientation focused on daily service could literally make your entire life happier!
The Fair Exchange of Real Estate Investors
“It is one of the beautiful compensations of life that no man can sincerely try to help another without helping himself.” — Ralph Waldo Emerson
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The basic idea of service in business is a fair exchange. You give the customer something of value. In return the customer gives you something of value.
So when you see yourself and your real estate business as a service business, you will see every interaction with sellers, lenders, tenants, and buyers as an opportunity to do a fair exchange.
Let’s think about the core value we real estate investors really bring to others. If you’re going to be in the service business, this value proposition with sellers, lenders, tenants and buyers needs to be on the tip of your tongue.
We offer a homeowner with a house problem (or a life problem) an easy way to liquidate or dispose of their house. In exchange, we receive a discount and/or favorable financing terms from the seller.
We give a lender three things they rarely get together in the investment and finance world:
1. Safety of principal
2. A fair return on investment
3. An easy, hassle-free investment
In exchange, our lenders (in my case, usually private lenders) give us access to progressively larger amounts of capital and affordable interest rates.
We provide safe, clean, well-kept housing in desirable locations for rent. In exchange, we get tenants who make regular, on-time payments of rent (ok, not always!), who take care of the home as if it were their own and who stay forever (wouldn’t that be lovely).
We provide a beautiful, remodeled home in a desirable location. In exchange we get a quick sale at top price with little or no haggling.
What Business Are You In?
I believe if you start with a more positive idea of your core business identity, you will do much better as a real estate investor. So think hard about what business you are really in.
Also think about your own daily investment in a fair exchange. The blogs and forums at Biggerpockets.com are filled with discussions about good acquisitions, raising capital, long-term rental income, and selling houses at retail for cash.
Like you, I love getting those results. But I propose we start focusing more on doing our part of the fair exchange with excellence. The positive results will come to us too, and in abundance. But they will be a byproduct of our deliberate investments in service.
Do you view your business in real estate as service oriented?
I’d love to hear from you in the comments section!