Sustainability & Self Efficiency: How to Build Your Real Estate Business for the Long Haul
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It’s Engelo Rumora here, your favorite Australian and the Real Estate Dingo.
I’m actually liking these new Aussie blog intros so I thought I would continue them — especially since I get bugged by many on a daily basis about “Ohhh my, I love your accent. Where are you from and what are you doing here?” while I’m trying to get business done. Sorry, but payback is bliss. 😉
As the saying goes, “Success comes from doing things differently,” so try to be different in everything you do and don’t just be another white sheep like most folks are.
One of our awesome investors from California called me last week and said, “Engelo, do you know that I have to trust you 1,000% percent with everything that goes on with my properties in Ohio? Also, what do I do if one day you decide to pack your bags and move back to Australia while leaving me hanging with my Ohio rental portfolio?” Jokingly, I said that if that should ever happen, he should sell every property and move with me.
I also mentioned to him that I connect with a ton of other investors on a daily basis, and I always stress to every single one of them that they should focus more on establishing trust and relationships with key people on the ground before looking into anything else. Trust is built over time and not over one phone call, email or meeting. Make sure that the people you are looking at working with always have your best interest at heart and possess these 4 key traits: Honesty, Loyalty, No Greed & Respect.
Once you establish such a trust with these folks, you will find that their reputation means everything to them, just like mine means everything to me. Most entrepreneurs and business owners have their business brand associated with their personal brand, as that’s how many have become known in the first place, so any negativity or wrong doing on either end will muddy their personal and business brand.
As I was explaining this to him, I also mentioned an awesome quote that I truly stand by: “It takes a lifetime to build a reputation and only 5 minutes to lose one.”
As we continued our discussion, I elaborated in more detail to give him peace of mind about my core values and beliefs for my company, along with its current and future employees.
Two key words popped into my mind: Sustainability and Self Sufficiency.
When your looking to invest in real estate, be it through a turnkey provider, by yourself or utilizing other investment strategies, you must always ensure that what you or anyone else is doing can last and be sustainable. One example of something being non-sustainable is when I was buying properties in Australia at super high prices, refinancing out of those mortgages and buying more properties while my debt levels kept growing higher and higher. Not to mention that my rent was nowhere near enough to cover my loan shortfall along with other expenses. Now, that was just not sustainable.
Another example would be buying property from a turnkey provider that solely focuses on making a quick profit rather than delayed gratification. You will find that most of these guys will sell you properties for much more than what they are worth, leave you hanging with an unreliable, outsourced property manager. Then they pocket half of the profit and use the other half for marketing and advertising so they can attract fresh blood to quench their thirst. Yuck! This operation does not last forever, and eventually it all comes crushing down. Be very wary of turnkey real estate companies selling in various states without actually having a strong foothold on the ground.
There are so many books out there that talk about systemizing your personal and business life along with writing operating manuals and guides to assist you with getting more for less and becoming self sufficient. A few of the most well regarded books include The E-Myth and The 4-Hour Work Week. At the end of the day the only way that something can be truly self sufficient is by having the right people around you, doing the things that you can’t or don’t want to do. Surround yourself with people that believe in the same vision and have similar end goals in mind. Compliment each other and work together in achieving those goals. If you help others get what they want, they will also help you get what you want. (Don’t forget to look for the 4 key traits above.) This goes for if you’re flying solo in real estate or if you’re building a business like I am. Either way, I see real estate investing as a business.
“Work on your business and not in it.”
I am sure you can imagine that our investor was quite intrigued with everything I had to say and was feeling much better about his initial concerns. As our conversation was coming to an end, I shared with him that although I am green in real estate compared to some of my business partners (20+ years and thousands of deals under their belt), I was quick to realize that in order to successfully build my company and personal real estate portfolio, I had to surround myself with people who believed in the bigger picture and shared the same vision as I did. I also stressed that we were here to stay and continue growing the business in a sustainable and self sufficient way and that our reputation means the world to us.
Keep the dream alive.
How do you keep your business sustainable and self-sufficient?
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