How Do I Know If I'm Ready To Get Started?

There has been a recent plethora of posts along the lines of “At what point did you know you were ready to make your first investment?” “How do I know I’m ready to make my first purchase?” These are legitimate concerns and I appreciate the intent behind them.

My gut reaction before actually putting much effort into a response is to simply say get in the game and roll, but I understand that response does not provide much value and can also be misperceived as reckless advice. Therefore, I reflected on these questions and wanted to summarize these thoughts on paper. If this blog eases one person’s anxiety, or gets one newbie to take the next necessary step, then it was well worth the time to write this.

You Will Never Be Fully Prepared and You Will Make Mistakes

For those of you who are parents, you can fully relate that no matter how much reading you do on parenting, nothing can fully prepare you for your first child. And guess what? You did it! There may have been some situations you could have handled better, but you figured it out and remembered those instances for when (if) you had your second kid. You came to realize that things might not go perfect, but it’s amazing how you can adapt to any situation.

Similarly, if you want to be a boxer, you can train and spare all you want, but until you get into the ring and actually fight, you will never progress. This ties nicely to what another investor told me at a conference, “Everyone wants to get in the ring, but most are too scared of getting punched in the face.” Seeing punches fly at you is part of the game, you can strategize all you want, but you need to actually do it live to get better at avoiding these punches.

The largest syndicators, most established realtors, and the world-class flippers will all tell you they are still learning. You’re never done learning in this industry. If you waited until you knew everything, you would spend a decade before you ever bought your first property. You don’t need to know everything, you just need to know the next step. It’s going to be scary but nothing great is ever accomplished without stepping outside of your comfort zone.

The First Step and The Commitment Junction

Gary Keller is the founder of the largest real estate company in the world and author of The One Thing. In The One Thing, Keller states that the secret to getting ahead is getting started. The secret to getting started is taking complex overwhelming tasks, breaking them into manageable tasks, and focusing on just one task. This is a great approach to real estate as there are many facets to bring a project to close and you will fall into analysis paralysis without laser focus.

For most folks, that first task is education. They read a few books, listen to podcasts, and establish a foundational baseline of knowledge. Great! These are all necessary activities, but they are also convenient activities that involve minimal skin in the game. Unfortunately, for many potential investors, progress stalls here as the next steps are served-up with risks, are not as convenient, and test your commitment-level to your goal. At this junction, you need to ask yourself if you’re committed to the journey. John Assaraf summarized it best, “if you’re interested, you’ll do what’s convenient, if you’re committed, you’ll do what it takes.” Unfortunately, many people live their lives by default and are not committed to actually making a change.

The Next Steps After Commitment

So you are actually committed and you want to move forward, what’s the next tangible step? Brandon Turner does a nice job on several of the podcasts breaking down goals (“If you want to close a deal then you need to offer on XX, and therefore you need to analyze YY...etc). I agree and let’s take this even further.

If you want to own your first 10 rental properties next year, then you need to break this into monthly, weekly and daily goals. Your annual goal is accomplished by hitting monthly goals, which is accomplished by hitting weekly goals, which is accomplished by hitting daily goals. “You will never change your life until you change what you do daily,” -John C Maxwell.

But I Have An Obstacle….

Most people will agree with the above paragraphs on goal-setting, but there’s usually a perceived reason for why these daily and weekly goals can’t be accomplished. These reasons might be justified at the moment, but they can easily be overcome if the obstacle becomes your focus. Circling back to Keller, he outlines the following important question, “what is the one thing you can do such that by doing it everything else would be easier or unnecessary?”

Staying with this logic, let’s breakdown some of the reasons you might be stuck and what you can do about it before you do anything else. This is not meant to be all-encompassing lists, but rather to paint the picture of how you should approach your obstacles and where you should attribute your focus. To be clear, identify your obstacle and spend all your time (that you can) tackling this obstacle. Don’t worry about reading blogs, thinking of your LLC structure, or learning more from podcasts. Just tackle the obstacle and then move on.  

Sampling of Obstacles and What Your Daily/Weekly Activities Could Be:

“I don’t have a contractor to do the work”

-Get out out to the next 2-5 RE meet-ups in your area and find contractors

-Pick-off contractors at Home Depot and Lowe’s

-Look-up cash purchases in your area and drive to these sites to find contractor

“I don’t have the funds to make a purchase”

-Call 10 lenders in your area and tell them your plan. If they can’t help you get a referral from them as lenders know lenders

-Reach out to other investors in your area and ask who they use to fund their deals

-If you have a deal, find a partner and give up the amount of deal you need to get in the game. It’s not sexy, but it gets you started. If it’s really a deal, someone will partner with you as there are literally billions of dollars floating out there looking for solid returns

“I can’t find any deals”

-Find 5 wholesalers this week - Search BP, Google “We buy homes (your city), attend 5 meet-ups

-Set-up 5 meetings with realtors/brokers in your area and come prepared with your exact specifications and compelling reasons to why they should want to partner with you

-Drive for dollars, find 25 homes, look up the owner, find their info (which you can do for free), and call them

-Find 10 properties already under contract that you like and write the selling realtor a note along the lines of, “congrats on getting this property under contract, if things change for whatever reason, I’m ready to move immediately and purchase this property”

Again this is not an all-encompassing list of tasks, nor every potential obstacle. The point is there are tangible steps you can take to move forward. Listening to another podcast is not going to solve your problem. You need to identify the blocker and act on it. It requires more effort and vulnerability than the first step of education but it’s a necessity. Step outside your comfort zone and actually do the tasks. You are going to have to do them to be successful, why delay? It’s a harsh reality, but if you are not willing to hold yourself accountable to these tasks, you are just interested in real estate and you are not committed to it as a real life-changing goal.

Don’t try to rationalize that you’ll do it later or “after the next book.” Don’t default to I’ll just read the forums a few more times. One of my favorite piece of advice comes from Clement W Stone, “Before you get out of bed every morning, say “do it now” fifty times.”

Make It Happen

There is no set point where you’re going to be ready. Success is not a nice linear path but the outcome of performing daily meaningful tasks over a given period of time. Meaningful in the sense that they are overcoming an obstacle and taking you closer to your goal.

You need to ask, am I committed? If so, what are my obstacles, and what daily steps do I need to take to move forward? Remember, thousands of other people no smarter than you have accomplished great things in real estate, therefore so can you. It is going to feel uneasy and you’re going to have moments of doubts, but these are the normal feelings of growth. The only way to arrive at a large complex goal, is to break it down and act on the necessary daily steps.

“Twenty years from now you will be more disappointed by the things that you didn’t do than by the ones you did.” - attributed to Mark Twain.