Hindsight is 20/20 as they say.
Looking back at how things were when I was getting started, I realized there were things that I could have done better.
Had I done these things in the beginning, I’m 100% sure my house flipping would have progressed much faster. Hopefully these tips will find people that are struggling with some of them and are not even aware of it. If so, this article will surely speed up your progress.
Here are the 5 things I should have done when I got started flipping houses:
Figured Out I Didn’t Need To Be An Expert To Take Action
Not that I became an expert before I got started, but I think I could have progressed much faster had I dealt with the self-doubt and started taking action earlier.
I continuously hear people talking about analysis paralysis and needing more information before they finally ‘take the plunge’. We all just need to get one more course or learn about that other technique that we just heard about.
If we could add another tool to our toolbox so that we could cover every conceivable situation, we’ll be good to go. Unfortunately, you will never be prepared to handle every situation. That’s just a fact of life. It’s time to face it.
When I got started, I learned about the basics… which reminds me of the book title, “Everything I really need to know, I learned in Kindergarden.”
Looking back, the basics were really all I used as I started taking action and putting myself out there, getting out of my comfort zone, growing, learning, finally making it happen. It turns out I really didn’t need to learn the ins and outs of ‘subject to’ or ‘section 8’ or ‘tax strategies for real estate investors’ (heck, I wasn’t even making any money yet and I was already trying to figure out how to save on taxes) or ‘land investing’.
Man, what was I thinking?
It’s Much More Comfortable To Have To Learn Just One More Thing
It’s just a way to avoid what we are afraid of. If we don’t do something we’re not used to, we can’t fail. We won’t make a mistake while we’re trying to learn that new aspect of investing.
As soon as I would read something new on a forum, I’d think, “Ok, I need to find out more about that. That’s something I need to know.”
It wasn’t something I needed to know. It was a way to avoid having to take action.
Of course, I needed to educate myself to a certain level, but that level doesn’t need to be an expert level. I don’t think people can get to the expert level until they take action and learn from the school of hard knocks. Besides, knowing a little about a lot of different things can be a true detriment. I’m immediately thinking of situations where new investors confuse the heck out of sellers with their 5 different purchase options that involve crazy tactics that were concocted by someone that had not even tried it before. Scary.
Focused On Getting My Message In Front Of The Right People
I wish I had truly focused on just getting my message in front of the people that needed it. I started by marketing to motivated sellers for deals.
The majority of my time should have been spent working on doing just that. When spending some time working on something, I should have asked myself, “Is this allowing motivated sellers to find me NOW?”
You see, I was spending a lot of time staying in my comfort zone, making SWAG. My wife would always see me designing and ordering new refrigerator magnets and pens with my message on them and would ask what I was doing. I thought I knew, but I was lying to myself. All of those things were just sitting in boxes in my office, yet I was ordering more. We had two boxes with 10,000 door hangers that sat for over 2 years.
What good was that?
It wasn’t like motivated sellers were going to magically come knocking at my door and go straight into my office to dig through boxes to find my message. I wish they would. That would truly make things a lot easier.
What I needed was a plan.
What I should have been doing was writing up a marketing plan that focused on the marketing that got the phone ringing immediately. A plan that I could start implementing that would keep my marketing consistent.
Instead of ordering pens that very few people were seeing, I should have been putting bandit signs up at super busy intersections or driving neighbors looking for vacant, distressed houses. It’s very obvious that ordering more pens is the easier of the choices, but what were we trying to do? We weren’t trying to market for marketing’s sake. We wanted and needed to get the phone ringing.
I was collecting junk in my office when I should have been collecting junky houses.
Talked More With Other Local Investors
I wish I hadn’t been such a hermit in the beginning. I’d been to local real estate investment association meetings on several occasions but didn’t talk to a single person other than my wife. At the time, I didn’t think it really mattered.
Now, I know better.
This one actually took me a while to truly figure out. I just wanted to be the lone wolf figuring out how to outsmart my competition. That’s not what we would call an ‘abundance mentality’. You’d think everyone would just want to keep what they are doing to themselves, but most are really willing to share if you take the time to really build a relationship. You’ve got to give in order to receive.
One of the biggest benefits I’ve realized over the past several years is that other investors are willing to work leads that I have no interest in. I get leads all the time that I don’t have any desire in working. Now that I have good relationships with several other local investors, I just make a phone call or simply text message the information to them and they work the lead. If they buy, I get paid a referral fee. All from leads that would have just ended up in my trash can because they didn’t meet my investment criteria.
Don’t assume all investors have the same criteria as you or are working the same investment strategies as you.
Always Made An Offer No Matter What
I wish I had made offers on every house that I looked at. It’s crazy to think about how much money I’ve left on the table over the years. Even aside from not knowing other investors that might be interested in a particular deal, there were houses that I could have made a super lowball offer on that may have been accepted.
I’ll never know because I didn’t make the offers. They were just not houses that I had any interest in. But…
At the right price, anything can be a deal.
Buying at the right price will allow you to just sell the deal to someone that would be interested in it.
These are the best opportunities because you don’t really care whether you buy the house or not. In fact, even though you are offering super low, you still kinda hope they don’t accept it. It’s funny how that works.
Don’t be afraid to make super lowball offers for properties you have no interest in. There’s a good chance your competition isn’t even making an offer.
Stayed Out Of War Zones
I wish I had stayed out of war zones. It just wasn’t worth it. War zones are areas where gangs, prostitutes, drug dealers, etc. are out of control (or in control – however you want to look at it).
You can find some really awesome deals in these areas … and these are the types of leads I sell to other investors (birddogging).
Risking your life or well being to make a buck is never worth it, in my opinion. You never know what could happen in those areas. This is especially true if you prefer to drive a fancy car, wear lots of jewelry and don’t have a clue about how things really are in these areas.
If you find yourself looking at a house that is one of more than 2 dozen that are boarded up on the same block, there are prostitutes walking the streets at 9:00 in the morning, guys are exchanging little baggies on the street corners and gun shots are being fired nearby, you know you are in a war zone.
Do your family and friends a favor and avoid these areas. These are for hardened landlords and greater fools.
There you have it.
If you’re just getting started, I hope you gained some insight into what will surely help you avoid some of the things that stunted my growth.
If you have been flipping houses for a while and have looked back at some things that you could have done better, please share them in the comments below. It will be a great help to all of us. Thanks for sharing.
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Photo: Kurt Nordstrom