Developer · Santa Clarita, CA · Member since 2008 · 15k+ posts · 10k+ votes
When I first started out in this biz, I read a ton of books, attended a ton of seminars and paid for training/bootcamps from the gurus (my only real mistake). After having a solid foundation under my belt as far as education goes, I lacked the ability to apply that information and education in the real world.
What got me over the hump was actually doing it with others. The hands on work really gave me the confidence and experience to begin my career as a REI. Then I got a mentor who guided me even more, doing deals together and taking my career to the next level.
That has been my experience getting started and I was curious to know how many of you would like to share what the most important stepping stone was for your STARTING success? Also, are you the type that can read books, study materials and read and ask questions on forums such as BP and apply that in the real world or are yo the type that requires more hands on experience to accomplish that same goal?
I've always told interested parties not to spend the 20K on seminars or gurus. Use the 20K and go buy SOMETHING!!! IMO, you'll learn more from that approach than ever spending the 20K in guru land. Lots of free info on here from folks as good or better than the gurus. You may luck out and actually buy something good.
Remember, the seminar companies will keep trying to bleed you till the investment money is gone. Hands on imo. Rich.
You don’t lean to ride a bike by reading a book or going to a seminar. While reading is a great way to learn, it is the experience of actually doing that matters most.
I feel I have decent success reading books. I have the ability to picture myself doing as the book describes. My only issue has been that once you go hands on you learn a lot more than a book ever touches on.
I certainly believe that different people absorb differently, some may learn from watching others from reading a boring text book. I think the best method that works is a little of both visual and mental stimulation.
Then once you become hands on it all makes more sense and it gives you the ability to quickly adapt simply because you're physically doing what you saw/read.
I do just fine reading books/study material to get me started but being hands on is where I absorb and perfect
I've always told interested parties not to spend the 20K on seminars or gurus. Use the 20K and go buy SOMETHING!!! IMO, you'll learn more from that approach than ever spending the 20K in guru land. Lots of free info on here from folks as good or better than the gurus. You may luck out and actually buy something good.
Remember, the seminar companies will keep trying to bleed you till the investment money is gone. Hands on imo. Rich.
I spent about a year reading, writing a business plan, talking to other investors, and preparing to "carry out my plan."
I think the time was tremendously useful, and allowed me to hit the ground running when I finally started out.
That said, the year I spent learning could easily have been accomplished in half the time, and it wasn't until I purchased my first property that I really "got it."
So, for me personally, the reading was an important part of the process, but I never would have really understood all the concepts until I started doing.
There are some things that you just can't learn from reading a book...
Well there isn't nothing wrong with education sometimes you need to learn what needs to be done so you can get the legits of what is needed to succeed then once you acquired the knowledge you seek apply it.
Most "how to books" on real estate do not have enough interesting pictures and have a lot of words - to many words for me :)
I did a bit of a mix - no real seminar - I did a little (and do I mean a little) reading but a lot of action. I was sending out mailers and knocking on doors when I had no clue what to say or do - I look back and shake my head and laugh.
While every deal wasn't profitiable and I lost money along the way - that was really my learning experience - that was really my seminar - the school of "fake it till you make it" & "flying by the seat of your pants".
Since - I have read a lot - gone to seminars and still do to this day - I pick up a lot more now because I have a wealth of experience behind me.
However you learn, there is absolutely not excuse for learning every lesson the hard way - through the school of hard knocks. Whether you learn the business through books or by making friends with the SUCCESSful investors are your local REIA or by reading the forums right here on BiggerPockets, the key is to learn the basics of the business before you put your money at risk. I also would not waste my money on paid gurus, mentors, bootcamps, or seminars. Many (most) of these people don't know the business or they would actually be making their money in the business instead of trying to fleece newbies with the promise of a secret that doesn't exist.
That being said Mike, what would be better?
A) Pay a guru at an overpriced event and then go do it
or
B) Just go dit it from the seat of your pants as in Scott's example.
Note: There is no choice C in THIS example, just curious which you would choose if these two were your ONLY options.
I guess the answer to your question is that it would depend on what the "guru" charged and what the guru knew. If it was $20,000 (or more) that some newbies lose to the gurus and the newbie had even a little common sense, then it might be cheaper to 'just do it'. On the other hand, if the guru training was $500 and you found a "guru" that actually knew something about the business (rare), then the guru might be the way to go.
FORTUNATELY, these are not the only choices!!! REIAs do exist and are filled with real investors who will be happy to help you for free! BiggerPockets does exist and you can learn 100 times what some "guru" will teach you here ABSOLUTELY FREE!
So, if I had to answer your question and there was no Answer C - I would choose D - none of the above. A choice between a "guru" and "just do it" is no choice at all!
You will learn on actual experience rather than just reading a book, because whatever your have read on a book but with out the action or the actual application is nothing.
So far, it looks like the winning vote is the hands on expereince is "more" beneficial than the book learning, although educating yourself through books, forums and courses is a good start.
As expected, Mike found a way to squeeze in not only a choice C, but a choice D which was not available in the hypothetical, but I appreciate your opinion and insight and I agree. Thank God we don't only have choice A or B.
Going back to that scenario, if the guru program was something worth while and the cost was less than $5,000, could I assume that would be the better choice than flying by the seat of your pants? I would say that the mistakes you would probably make going on your own without any mentor and help by your side would result in losses in excess of $5,000. Would Mike and others agree?
I don't believe "in one or the other" rule. I do believe in the 168 hour rule. There's a 168 hours in the week. Plenty of time to do both.
The difference between going out and actually doing is confidence. Depending on your confidence level, I think you go out and do. Books are good for helping that confidence level. Jumping in feet first cash in hand can be fatal for newbies on the first deal psychologically. Teaming with a mentor is almost a must, even if it's just shadowing them.
Thats my plan at least, spoken from a TRUE newbie. My thoughts are if, and when, I can hang in a conversation with experienced investors, then I am ready to approach one as a mentor and lead them to their next deal, and NOT ask them to hold my hand. I expect no compensation in return for the first but do ask and expect fairness in their consideration of my work and diligence. The next deal will then bring even more to the table.
Well Blacke, it was not a "rule" only a hypothetical to get people's opinions on the matter.
Either way, I agree with you that learning hands on really is the best way to learn, but having a coach to ask questions to or guide you through is also vital to your success.
I think your offer to get taught and give the teacher the full profits from the first deal is great, however, many have "offered" that very same thing to me and in the past I took them up on it. Do you know how many deals I got to cash because of it? NONE, because most people do not follow through or show the real dedication that is necessary to get a deal, let alone complete one.
But the thing is that would you tell a rookie just to go into real estate without education blindfolded or should the rookie learn the fundamentals of REI before jumping into the game?
Well of course you would inform them to get educated first and read books, participate on the BP forums, and do as much research on the internet for free as they could. From there, they have a foundation to build on. Then the next step is to DO, but from the consensus here, the DO part shoudl be done with someone experienced who can help avoid them making costly mistakes, even if that comes at a reasonable cost rather than DOING on your own and getting the experience the hard way.
You don't need someone holding your hand to avoid mistakes if you learn the basics. If they read on BiggerPockets how to calculate cash flow, do they really need a $5,000 "guru" or "coach" to tell them the same thing? That's a pretty high price to pay for being insecure!
Reading then Hands-on because variation can come up, you enjoy the variety of tasks and challenges found in property management. Sure, some aspects of it are repetitious. Rent’s due every month after all. But for the most part, every day in property management is something new.There is also interaction with different people,if you’re a people person, you’ll findthat property management is a great opportunity to meet all types ofpeople. Not everyone you encounter will be someone you want to make your close friend, but you’ll certainly have the chance to work with a smorgasbord of personalities.Development of skills: Property management requires diverse skills,because you must handle so many different tasks (like marketing,screening, and maintenance, just to name a few). But it also allows youto grow those skills beyond the basics through patience and passion,like by moving from advertising your rental unit in a basic way to analyzing ad campaigns for unrelated products and applying those concepts to rental housing. Experience with real estate investment: As you manage rental property,you obtain the necessary skills to become a successful real estate investor. Of course, some real estate investors succeed without everbeing hands-on property managers because they hire others to handle the task for them. However, I believe every rental property owner should gain that real estate investment expertise by actively working as a property manager for several years.
Mike, we are not talking only about a landlording business as you have. We are talking about ALL asspects of RE investing and having someone with years of experience, trials, test, failures, etc. allows the newbie investor to avoid some of the errors and mistakes that can ONLY be learned from years of experience.
For instance, over the years, I have developed several checklists for several things. I just added one item to my checkllist for when a tenant moves out - Turn off the water valves to the toilets as I just (for the very first time after all these years) had a toilet brake and cause moderate water damage to my rental home. Someone learning from me, for example, could avoid some major future costs and headaches from my experience and yours for that matter. I am sure you didn't run a tight ship from day one, but developed a routine and plan after several occurences happend in your biz.
That one item added to the checklist could save someone else several thousand dollars and I have hundreds of items just like that!
I agree with you Will. A tight ship only comes with experiences both good and bad. Studying and reading books is apart of the experience, hopefully from other peoples mistakes; and also their accomplishments.
Originally posted by nationwidepi:
That one item added to the checklist could save someone else several thousand dollars and I have hundreds of items just like that!
Could we have the opportunity to see/have those checklists as to learn from those experiences?
Will, I'll have to admit that you did prove your point, at least as far as you are concerned. You did learn the lesson about turning the water off the hard way and it doesn't sound like you understand the real lesson yet. The real lesson has been covered on this site long ago and that lesson is to turn the water off to the entire property when it is vacant, so that it can't leak ANYWHERE in the house. Turning off the water to the toilet only prevents a leak at the toilet, not a break in a water line in the basement or walls. In addition to turning off all the water at the main shutoff valve (at the street is even better), you need to shut off the water heater so that you don't burn up the element. Finally, you should install a drain, or better yet a sharkbite connector, just inside the main shutoff valve, so that you can easily drain the water from all the water lines during the winter (so that no lines will freeze). If you install all PEX, you won't have to worry about pipes breaking, because the pipes can freeze solid and won't break. So, add all that to your checklist and that will save you from learning additional lessons the hard way.
My point is that we've covered all this stuff before. None of it is new. If people are willing to read and understand the forums, they won't need to learn the hard way and they won't have to pay thousands of dollars to a coach or mentor to learn it.
Quite honestly, I didn't make all these mistakes because the information is out there to easily avoid them. I have read many books and listened to investors at my REIA and I took their advice to heart. I don't need to have moderate damage to my rental property or make a hundred other expensive mistakes to avoid them. I certainly don't need to pay a coach or mentor thousands of dollars to learn lessons that are available for FREE!