Sometimes I do stupid things.<\/p>\n
I can’t blame it on anyone else… it’s just me. Sometimes I’m just an idiot.<\/p>\n
Dumb, I know.<\/p>\n
However, most of these things are fairly mild compared to the idiotic things I’ve done as a real estate investor. The following list may seem like I’m poking fun at others but, in reality, this is a reflection on the idiotic things I’ve<\/em> done in my investing career.<\/p>\n But I want better for you.<\/p>\n I don’t want you to look like an idiot. I want you to succeed and live the life you’ve always dreamed, so allow me to share with you my best tips for investing in real estate without looking like an idiot.<\/p>\n One of the best ways to look like an idiot when investing in real estate is to jump in before you know what you are doing. You saw it on TV, you read it in a blog post, and suddenly you think you are the next Donald Trump and… well, you end up looking like\u00a0Rosanne Singing the National Anthem<\/a>.<\/p>\n It’s not pretty.<\/p>\n So take the time to learn your craft, do your homework, read the books, listen to the Podcasts, and get yourself some good ‘ol fashioned American edu-ma-cation! \u00a0(just… try to\u00a0avoid the $9997 course… you don’t need it.)<\/p>\n Related<\/strong>: BiggerPockets Presents: The 21 Best Real Estate Books Ever<\/a><\/em><\/p>\n When getting\u00a0your education, it’s overwhelming.<\/p>\n There are a lot of niches (like single family houses, multifamily, commercial) and a lot of strategies (like flipping, wholesaling, landlording) that you could learn about… and you’ll probably want to.<\/p>\n This is a major struggle\u00a0for those who love the BiggerPockets Podcast<\/a>.\u00a0Every week there is a new, exciting niche or\u00a0strategy to explore. However, trying to do everything is going to make you end up looking like an idiot when you get stuck trying to learn everything, do everything, and wind up going no where.<\/p>\n Instead, focus on one niche as long as you can. Master it, then expand.<\/p>\n Want to know who isn’t<\/em> an idiot?<\/p>\n Warren Buffett.<\/p>\n Yep, THE\u00a0<\/em>Warren Buffett. Like, “most-successful-investor-in-a-billion-years Warren Buffett.” \u00a0What made him so successful? Well, if you were to ask him, here’s what he’d say… (because, he said this:)<\/p>\n \u201cNever invest in a business you can\u2019t understand.\u201d<\/span><\/em><\/p>\n I think he’s right, and this ties nicely into #2. Don’t invest in something you don’t understand. Instead… go understand it first, then worry about investing in it.<\/p>\n Let me ask you a very simple math question.<\/p>\n Now… wait, come back… I promise, it will be easy. Just settle down, champ. \u00a0Just answer the following question:<\/p>\n Which is better: \u00a0<\/em><\/strong><\/p>\n A.) Getting half of a great deal or<\/em><\/p>\n B.) nothing,zero,zilch?\u00a0<\/em><\/p>\n Hopefully you answered “half of a great deal.” \u00a0It’s the obvious answer, yet so many wannabe investors choose option B. They think “I can do this all by myself.” Yes, you probably could. No, you probably won’t.<\/p>\n My good friend Ben Leybovich<\/a> is working to syndicate an apartment deal right now. Ben’s\u00a0a smart dude … one of the smartest I know. However, when he decided to jump into 100+ unit apartment complex syndication, he didn’t do it alone. He aligned himself with one of the other smartest dudes I know, who is an expert on syndicating apartments. \u00a0Yeah, he’ll be splitting the deal, making less than if he were to do it alone. However, he’s going to syndicate a 100+ unit property while the rest of us are playing Pok\u00e9mon\u00a0on our Game Boys. Sorry… 90’s flashback. I mean Angry Birds on our iPads.<\/p>\n So if you want to avoid getting egg all over your face, partner up with someone who knows what they are doing. You can do all the hard work, they can bring the expertise, and together you’ll find incredible success.<\/p>\n Here’s a fun way to look like an idiot: losing everything you’ve worked so hard for.<\/p>\n If you buy more than you can afford, more than you can manage, more than you can handle in an economic downturn … chances are you’ll end up looking like an idiot when your house of cards comes crashing down.<\/p>\n Keep your ambitions in check and don’t bite off more than you can chew.<\/p>\n Here’s a fun one. We all know that guy… he walks into the forums and says “I’ve got bulk deals in all 50 states and I’ve been investing for 12 minutes.<\/em>”<\/p>\n Yeah, right. And my Prius runs on the music of Michael Bolton<\/a>.<\/p>\n Whether you are just starting out or have been investing for years… be real.<\/p>\n Be yourself.<\/p>\n Admit to what you know and what you don’t know. Then go back to step one, get educated, and become the bigger person you want to be. But until then, keep your ego in check and avoid looking foolish.<\/p>\n This is not a new game.<\/p>\n People have been investing in real estate for thousands of years, and even more importantly- very little has changed in the past 100. \u00a0So to avoid looking like an idiot, don’t dismiss the advice of\u00a0those who have been investing for years. They’ve seen both the ups and the downs in the market, and can see the real estate history like a hot air balloon over a parade while you see it from the street: one float at a time.<\/p>\n Yes, you are going to be successful someday.<\/p>\n I believe it, really.<\/p>\n However, don’t start spending your money like the Jersey Shore It’s very tempting to tweak the numbers to make it work.<\/p>\n That’s fudging the math. It’s stupid, it’s dangerous, and it’s going to make you look like an idiot\u00a0in front of your partners, investors, spouse, or lender when it all comes crashing down. Stick with conservative math. Err on the side of caution. Run your numbers through the BiggerPockets Property Analysis Calculators<\/a>\u00a0and make sure you are accounting for\u00a0all<\/em> the expenses.<\/p>\n Finally, to avoid looking like an idiot, always know your\u00a0why<\/em>. Keep the main thing the main thing. Don’t get so wrapped up in the business of real estate investing that you forget\u00a0why<\/em> you are choosing to live this life.<\/p>\n For example, I am investing in real estate so I can make enough passive income that I can spend unlimited time with my family and future children. \u00a0I don’t do it to get rich, to buy nice cars, to see my bank account climb. I do it for my family. So… if I’m ignoring my family while trying to build my business, I’m sacrificing the very goal I’m trying to reach. That’s me, being an idiot.<\/p>\n Know your why. Don’t be an idiot.<\/p>\n No one wants to look like an idiot, but at times – we all do. It can’t be helped. You will forget birthdays, you will buy stuff you don’t need, you will say the wrong thing at the wrong time.<\/p>\n It’s life.<\/p>\n10 Rules for Investing in Real Estate Without Looking Like an Idiot<\/h2>\n
1.)\u00a0Do Your Homework<\/h3>\n
2.) Know Your Niche (and Strategy)<\/h3>\n
3.) Don’t Invest in Something You Don’t\u00a0Understand<\/h3>\n
4.) When in Doubt, Partner Up<\/h3>\n
5.) Don’t Over-Extend Yourself<\/h3>\n
6.) Don’t Act Bigger Than You Are<\/h3>\n
7.) Listen to Those More Experienced Than You<\/h3>\n
8.) Don’t\u00a0Spend Before You Earn<\/h3>\n
idiots<\/del> kids on spring break when you are trying to build your business. The reward should come later, but in the beginning, you are going to need all the capital you can get. So keep living below your means, save your money, and build something great for your future.<\/p>\n9.) Don’t Fudge the Math<\/h3>\n
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10.) Know Your Why<\/h3>\n
Conclusion<\/h2>\n