Tips For Newbies - Learn How To Say "Next"
Bigger Pockets is such a great place for everyone to share their most recent experiences with Real Estate Investing (REI). And it's so exciting to see all of the great deals - and potential great deals - being discussed here every day. I often see forum posts on here from newbies who are about to score their first deal, or they have gotten their first phone call from a motivated seller. Such excitement!
Now, I don't want this to be a bummer kind of blog post, but I just wanted to put a little bit of info out there about those exciting leads and motivate sellers.
First, congrats on getting that lead or that phone call! Many newbies never even get this far. You're out there working it hard, and that hard work is about to pay off. Or is it?
What I want you to be careful of is this - becoming a "motivated buyer". You've worked so hard, read all of the blogs, listened to all of the podcasts, sent out 500 mailers, and now you have a lead! That's awesome! But slow down a bit.
You have to realize that the majority of your leads will not be deals. And you are excited and ready to get that first deal under your belt. But don't try to take a lead and make it into a deal where one may not actually exist. Take a deep breath, slow down, and really listen to that potential seller. And really take a good hard look at the numbers. Don't get caught up in the trap of thinking that goes something like this - "well, the ARV is probably 90 - 100, but maybe it will go 105....". Instead, use conservative estimates on the ARV and the repair dollars required.
In summary, not every lead is a deal. And not every deal is a good deal. Be careful out there, especially as you are just starting out, and be ready and willing to quickly move on to the next lead if that's what the numbers are saying. Just say "next" and move on. You're much better off to move on to a truly great deal than to try to make a marginal deal work. The great ones are out there too, but sometimes you have to just keep on looking.