Although vaguely, I do still remember the feeling confusion when I first started in real estate. I like to describe what this felt like with an image.
Imagine yourself standing in the middle of a corn field. The corn is tall, and you can barely see over the top. As far as the eye can see, it’s all corn. Suddenly, you hear church bells. You spin side to side trying to find the church that the sound of the bells could be coming from, but you see not a thing — just corn.
You had just gone to the doctor for a checkup, so you are quite certain that there is not a thing wrong with either your eyesight or your hearing. And yet, try as you might to find that church, there’s nothing but the damn corn everywhere!
That state of tension and frustration accompanied me at the outset of this journey. And I have to believe, considering your questions, that many of you newbies experience the same thing.
What Comes First — the Deal or the Funding?
This is one of the most often asked questions. And for good reason — it’s important. Unfortunately, most commentary is debonairly quick to pronounce the “simple” answer — it’s stupid to look for deals unless you have a way of financing them.
As with so many aspects of our business, while it may be hard to tell truths apart from half-truths, the answers we are looking for reside in precisely this — our ability to tell truths from half-truths, our ability to read between the lines.
Let’s Think This Through
Looking at this logically and with intellectual honesty, while it’s true that finding a deal and not having the money is a bit pointless, so is having a bunch of money and no deals. Truly, it’s the yin and yang that add up to a whole. You need both, and you need them at the same time!
Related: Newbies: Make TODAY the Day You Start Taking Action. Here’s Your Motivation.
The notion one is more important than important than the other is kind of silly. You need both! That’s the truth. But the reality of having both is daunting. Looking for one thing is challenging, but searching for multiple at once is intimidating, and therein lies the problem.
The 10/4 Rule
My wife Patrisha (she is a member so look her up) is a licensed agent in Arizona with Keller Williams. We are all familiar with the work of Gary Keller. His The ONE Thing: The Surprisingly Simple Truth Behind Extraordinary Results
At the brokerage that bears his name, one of the very interesting methodologies is the 10/4 rule. This is so ingrained into the culture that agents greet each other by saying, “How’s your 10/4 doing today?”
What is 10/4?
The 10/4 rule is simply understood as your ability to isolate 4 things that are most important to the perpetuation and growth of your business and doing on a daily basis 10 activities to feed each one of those 4 most important things.
For example, one of the most important things for me personally is to be better looking than either Brandon Turner and Darren Sager. Fortunately for me, God was kind, and to achieve this objective, I don’t have to do a damn thing. 😉
Related: The Ultimate 60-Day Action Plan for the Paralyzed Newbie Longing for a First Deal
So, if you are an agent, the 4 most important things may be to know the available inventory, to gain a buyers list, to gain listings, and, of course, to close deals. Thus, you might spend your day this way:
- Walk 10 properties.
- Talk to 10 potential sellers.
- Talk to 10 potential buyers or someone who can refer you.
- Do the 10 things most likely to result in the fastest closing.
At the end of the day, this is all about pipeline building. And,the more automation and outsourcing you can introduce into this process, the better.
So, What About You?
You need deals, and you need money to close those deals. Dear newbie, if you are not speaking to 10 potential sellers every day and 10 potential sources of capital, you are just kidding yourself about wanting to close deals. The action steps are clear.
What does your 10/4 exercise look like?
Let me know your thoughts with a comment.
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21 Comments
Great post and lots to think about! I read The One Thing recently and I am still digesting the concept of focusing in on the One Thing in this moment that will best further my goals. I have a tendency to want to take in way too much information at once and my
Oops! I hit post before I was done. I was saying basically that I get confused with the amount of information and my mind goes into analysis paralysis. I am also an introvert so getting used to networking and talking to lenders has been intimidating. I know the more I do it the easier it will be though. I was surprised when you suggested talking to 10 potential sellers and lenders per day! I’m wondering now how i’m going to find them all. I bought my last house off the MLS and I know that I need to find properties off-market if I’m going to get better deals. Thanks again for the post!
Well, Jackie, if it were easy, everyone would be doing it 🙂
Thanks so much for reading, and good luck!
You have us here to talk about deals with. We are all potential buyers and sellers as well!
Regards,
Bernard Braithwaite
Thanks for the great concepts provided. Cant’s wait to start using them in analyzing some deals.
Thanks again,
Andrew
Glad to help, Andrew!
Good article, honey!
For those of you who know Keller Williams, it’s actually the 10/4 – not the 4/10. Basically the same premise, though:) To make sure you’re operating at full capacity we need to do these four things every day.
1) Add 10 new people to our database
2) Reach out and connect with 10 people currently in our database
3) Write 10 notes (to recent connections or old friends/associates)
4) Walk 10 properties
I works that same way for investors with just a few variances that I think Ben covered well. Bottom line, get busy, hustle, and make some money!
Hi Patrisha:
I’ve edited the article to reflect your clarification. 🙂
Thanks for commenting!
Allison – will you please fix the spelling of Darren’s last name…my bad 🙂
Fixed! Sorry, Darren. 😉
Thanks, babe 🙂
Naturally I messed it up. I’m not worried – you’ll fix it! (Allison – does that sound about right to you lol)
This is great advice. Especially since I haven’t read The One Thing as of yet. (It’s queued up for my next months purchase in Audible.com). However, I’m now reading Pitch Anything which was highly recommended by several people including the routine Podcast book question.
I’ve always chuckled at people being adamant about “finding deals” or “finding buyers” first. They definitely go hand in hand, and like you said, it’s the yin and yang.
I’m going to use the 4/10 rule immediately, and I can’t wait until the first of the month when I start reading The One Thing.
Great Post!
Thanks so much, Leon. Good luck!
GREAT advice! Do your homework before making a move; and MOST importantly, LEARN from the mistakes of others! Thanks for this article!
Thanks indeed, Mark!
Totally agree, closing the first deal is the most difficult thing and the concepts put out by you will surely help greenhorns break that proverbial glass ceiling. I enjoy reading the insightful articles on Bigger Pockets as I myself do a lot of real estate analytical work.
Thanks indeed for reading, Sandeep!
We have been investing for about 2 years now, have four properties, and starting to identify areas we have issues Have started initiating an item that will help us find better deals. Using the 10/4 process will help us focus. Got “The One Thing” last spring and haven’t read it yet but it’s going to the top of my reading list. Things are slowing down enough I’ll have time to read over the next month. Thanks for the reset in thinking and inspiration and prioritization talk!
The one thing is an easy read, Sonia. It’ll go fast!
Thanks indeed for the comment.
Great post!! great advice!
Thanks for reading, Bernard!