Assessing Your Real Estate Investment Year

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Back in the 1980s New York City Mayor Ed Koch would walk around his city asking people “how am I doing?” He was seeking feedback from his constituents and this made him enormously popular. It was his way of assessing whether or not he was achieving his goals.

Do you ever ask yourself how you are doing?

It is quite common for real estate investors, like a lot of people, to set goals at the beginning of a year. It may be the number of properties or rental units acquired, wholesale deals done, rehabs completed, or houses flipped. It almost certainly involves a dollar amount made. Unfortunately, like the number of pounds lost or the resolve to get in shape, those real estate goals are all too often forgotten about before the first robin of spring warms up its voice.

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How to Face Failure

Why are goals so quickly forgotten? With things like weight loss or getting in shape it’s usually because old habits die hard and it’s easy to fall back into your comfortable routine. With business goals this is true to a degree too, but it could also be because you are not hitting the targets you set and it’s easier to ignore them than admit failure. Perhaps the goals were too lofty to be considered realistic. It’s a good idea to stretch a bit, but if there was never any hope of achieving them they weren’t good goals.

If you don’t reach your goals you shouldn’t pretend they didn’t exist. Take another look. What went wrong? Did you make a mistake when setting them or were some there extenuating circumstances? Maybe you lost your focus and were distracted by other opportunities or spent too much time putting out fires. That shouldn’t be an excuse to “wait till next year” like some diehard Chicago Cubs fan.

Setting Checkpoints for Attaining Your Goals

When you set goals it is important to keep them in the front of your mind. You should write them down and keep them where you see them every day. An effective technique is to create a picture board with your goals represented visually. Hanging that picture where you see it all the time will help imprint your goals in your mind. By using either or both of these techniques your goals will become part of your daily thoughts.

Now that we are in December it’s time to pull out those goals from last January and take a good look at them. How did you really do? If you hit them all, that means you didn’t set them high enough. If you didn’t hit any you need to determine what went wrong and do a better job of goal setting and executing your game plan. As you move into 2013 you should set checkpoints at various intervals to do a review. At these points you should make adjustments to your plan. Your goals and business plan are not etched in stone, they are road maps to guide you toward you target. Just as if you were flying a plane, you need to make adjustments to your course until you reach your destination. If you veer off course just adjust your flight plan, don’t bail out of the plane!

When it is obvious that the goals cannot be reached, don’t adjust the goals, adjust the action steps. – Confucius

Photo: Johan G

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  1. You make some great points. It’s easy to set goals, but it’s hard to follow up and see how we are doing. In June I wrote a blog checking in on our goals. It was easy to do at the time because we were far exceeding our business goals. …but I haven’t checked back in yet the rest of the year. I know I still haven’t met a few other personal goals I set in January, but yet I’m already thinking about goals for next year. I really need to check myself on where I went wrong with the goals I didn’t meet first.

    With real estate investment one of the most freeing things I discovered this year was to let go of the properties that aren’t meeting our expectations. This year I unloaded our two worst performing rental properties. It was a difficult decision because I have a hard time getting rid of the mentality that I can turn it around and force it too succeed. However, now that those two properties are gone, I realize it was well worth a bit of a financial loss. I’m much more focused on the other things that make a bigger difference. So, if your properties aren’t meeting your goals, check to see if there are some worth trimming.

  2. Brandon Turner

    Hey Richard – I like your article and the reminder of the importance of not only setting goals – but reviewing those goals to make sure they are doing what they are suppose to be doing. I have to admit – I’ve never been consistent at writing down and reviewing my goals – but my new goals is to become better at that! 🙂

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