At a recent real estate club meeting much of the talk centered around the state of the market. This is certainly to be expected as investors were networking with each other and comparing notes. It is imperative that investors stay abreast of the trends and conditions if they are going to be successful. However, there was a distinct difference between seasoned investors and relative newcomers.
Investors who had been around for some time were looking for ways to meet the challenges of the day. They sought solutions to their funding issues and looked for creative ways to deal with problems. There were deals all around them, they just needed to make them happen.
Meet The Newbies
The newcomers were a different story altogether. Those that were fairly new to the game had never seen a market where money wasn’t easy and real estate didn’t always go up. They complained about lenders who wouldn’t fund their “no money down” deals or whined about being stuck with a property that they paid too much for in the first place. Others had bought into the fallacy that cash flow didn’t matter because the appreciation would make it all worth it in the end. Now they are hemorrhaging cash and see no way out.
Instead of asking how to make things happen, the newbies wanted to know when things would return to “normal.” They don’t seem to realize that they already have. The recently burst real estate bubble was the aberration, not the norm. Giving money to people who shouldn’t get it was the fuel that fed the recent market frenzy. It allowed people to pay too much with the expectation that a bigger fool would come along and pay even more. This was totally unsustainable, yet the newbies are waiting for this to return.
The Seasoned Investor
Investors who have been around for awhile know that any market has its ups and downs. When conditions change the successful investor adapts to the situation. When a traditional funding source dries up they seek out alternatives. Instead of pining for the old days, they create new techniques or revisit some tried and true older methods of doing deals. To make money they need to keep moving forward, they can’t be immobilized because something changed.
In the real estate jungle it is truly survival of the fittest. There is a common thread that runs through people who are successful. They keep going when others would quit.