3 Things That Will Make or Break Your Investing Career
Earlier this week, I was talking to a few guys after the Real Estate Investors meetup that I put on once a month here in Reno, NV. We started talking about something we all hear ALL the time when consuming anything about the current single family real estate market.
“How can anyone afford these prices or these rates?”
I get it. I've been there too. Graduating highschool in 2009, I was becoming aware of housing prices during the downturn. My local base level knowledge was set at "a 3/2/2 SFR is $100k". Just like everyone else, I've seen those same houses climb up to $400k in the current market.
Real estate is hyper localized, so I can't speak on any other market, but running a flipping and wholesaling company here locally, we track the SFR metrics weekly, along with what a payment would be at the current interest rate on a $400k note.
In Q1, I was having a “how the **** are people still buying houses right now” moment. I googled the most current local median and average household incomes and went through a few different sources. A big piece of the equation that I (and many other locals) forget about is how much our area’s income has grown.
This isn't a post about stats or the market, so I’ll save it. But what I found from that search was like “oh… no this actually makes total sense. The income almost exactly matches the payment a Buyer would get approved for to buy a pretty average home here.”
In a nutshell, I was just wrong. Prices are “expensive” compared to what my base was for what the price “should be” and also my idea of what people make locally was wrong. Same thing.
Back to the meetup, explaining this discovery to the guys, one of them made me repeat the stat and clarify if that number was HOUSEHOLD income or SINGLE income. A few seconds later, he followed up with, “oh okay good, I was just wondering if that’s how much I should be making by myself.”
Attribute 1. Mindset. We talked for a bit after this, but without even recognizing it, his mindset is “make as much as the average.” Everyone has heard the generic Henry Ford quote “Whether you think you can or you can’t, you’re right,” but take a second and think about how that applies across everything - income, if you can do your first deal, how many deals you can do in a year, how many doors you can acquire, etc.
The vast majority of people just cruise through life on autopilot and quit on themselves VERY early in the game. They get a little comfortable, convince themselves this is “good”, tell themselves lies about why they can’t or shouldn’t keep advancing, etc.
In my opinion, mindset isn't a switch, but it's ongoing. Your mindset SHOULD keep improving as time goes on.
But it’s a catch 22 right? A lot of us struggle with something along the lines of “if I could just make $10k a month, then I could get to $20k, then $50k, etc.” The problem is… we don’t have the mindset to make it to $10k a month and we THINK we get the mindset AFTER we make it to the first milestone to prove to ourselves that we CAN do it.
Attribute 2. Faith. After the mindset shift comes, we still need faith to pull it off. I learned about wholesaling and thought I could do it. Did I KNOW I could do it? NO! Not until after the first deal when I proved it to myself… but the difference was I THOUGHT I could do it. I had a little bit of faith in myself.
The next milestone I want to hit at the company is 100 deals per year. How ridiculous does it sound to say we want to do that, and then say “we haven't done it yet, I don't think we can do it, but after it happens, then I know we can get to 150 per year.”
But how often do we miss that middle step of FAITH in other areas of life or even to get your first deal?
Attribute 3. Confidence. Confidence comes from actually doing the things you tell yourself you’re going to do and the reps you put in while doing it. Was I confident on my first deal? **** no. Was I confident on my second deal? No, but slightly more than the first.
I think people mistake faith with confidence. I guess faith is a FORM of confidence, but at the same time, they are two separate things. Right now, I don't have faith I can pull off the same type of deal that we do 8 times a month… I KNOW I can. On the first deals, I just THOUGHT I could pull it off. Big difference! And I’ll be right back to the faith step as soon as we move into other types of bigger deals.
All in all, if you don't have the MINDSET of wanting to improve and get more, you’re likely going to keep doing what everyone else does. If you don't have the FAITH that you can pull it off, then you never will, and you will never develop the CONFIDENCE it takes to keep making steps up the staircase.
If this post can help one more person recognize the flawed thinking they have and start down the track to more, then I’ve done my job. Hope this helps.