Real estate investing is hard! Wait, let me clarify. Real estate investing doesn’t require a college degree or a high IQ. Anyone can do it. Real estate investing is hard because there are so many options and components to it.
While it may look like some people become successful overnight, it’s just not the case. What people don’t see is the behind-the-scenes time and effort it takes for anyone to be a success. I’m sure you’ve heard the famous “10,000 Hour Rule” which suggests that it takes roughly 10,000 hours of a concerted effort to make any big feat work. Let’s talk real estate specifically and drill down as to why getting rich overnight as an investor just doesn’t happen. There may be people out there who were born into a wealthy family of investors and get rich overnight because it is handed to them, but ignore them for now because most of us aren’t them. Plus, the same efforts I’m about to point out had to be done by the family members who handed it to them at some point anyway.
The following are Three Essentials to be a Successful Real Estate Investor
- Education and Learning
- Building Teams
- Finding Your Vibe
Let’s look at those in closer detail:
The 20 Best Books for Aspiring Real Estate Investors!
Here at BiggerPockets, we believe that self-education is one of the most critical parts of long-term success, in business and in life, of course. This list, compiled by the real estate experts at BiggerPockets, contains 20 of the best books to help you jumpstart your real estate career.
Why These Essentials Don’t Happen Overnight for Real Estate Investors
- Education and Learning
Let’s be honest. There is A LOT of learning required to be an investor. To make it worse, not a bit of that learning were we were taught in school. When I became interested in finding a way out of my corporate job (which was after only about 30 minutes into my first day), I started reading every book I could find. I was constantly online researching things, I was going to seminars, watching webinars, networking and trying to talk to anyone I could find who might be able to teach me something, and thinking all the time about what may work for me. This went on for three years before anything even started coming out of it. Years. Yes, years. I consider myself to be pretty smart and quick on the uptake, so it’s not a matter of not understanding what I was studying, but there is just really that much to learn.
To add to that initial time I invested into learning, now I am out of corporate and in the industry full-time but I am still constantly ordering new books and looking for new events to attend. As I continue to work, I am always finding a weakness or an area that I don’t understand as well as I should, so I immediately look for a source to teach me whatever that is. In addition, these weaknesses I find while I’m working could have only been found by doing the work. No book could tell me everything I would need to learn ahead of time. I laid some great groundwork when it came to building a knowledge foundation, but only experience can teach you everything you need to know.
There is so much to learn and so much on-going training required to be a successful real estate investor, it just can’t happen overnight.
- Building Teams
Unless you’re lucky enough to meet one person who has teams in place already and you can piggyback off of those, it takes a long time to build your own teams. Even if you know someone who knows everyone, chances are his team won’t be your dream team. No two investors do everything identical, so how can his perfect team be your perfect team?
Building teams requires you to develop trust. Trust is hard to find in life in general and real estate is no exception. Trust takes time to build. Even more discouraging, trust can be broken even after a lot of time building it. It’s an on-going requirement that must be maintained through the life of an investment.
Trial and error is also an essential part of building the right teams. A big reason being that you don’t always know what it is you really need until you dive in. When I first started hiring property managers, I didn’t know yet what I liked and didn’t like in a manager, so it wasn’t until I hired my first manager that I realized what qualities I wasn’t okay with. I had to fire that first manager, then knowing what it was I wanted I had to interview countless other managers over the course of a year (yes, a year), before I found a manager I really liked and trusted.
Acquiring teammates through trial and error and building trust takes time. There is no other way to build. Therefore, building your dream teams can’t happen overnight.
- Finding Your Vibe
Tying the ideas of learning and team building together, a really big point needs to be made here.
The investments that resonate with you are likely not to be the investments that resonate with other investors you meet.
Yes, there are only so many ways to invest in real estate, but within those methods are infinite numbers of ways to accomplish them. The types of investments that resonate with you and how you actually go about succeeding in those investments is specific to you and only you. For example, it would make all the sense in the world to me to have first learned to flip properties rather than investing in rental properties because I would have earned the capital that would let me avoid the constant struggle to find new creative financing methods every time I wanted another rental property. However, it just didn’t happen that way. I didn’t seek out rental properties or rental property knowledge, but it found me instead. Not to get all hippy or transcendent on you but when I do the prep work and then something finds me, I have to think that thing is what resonates with me. I’ve done amazing with rental properties since then. Had I forced myself into flipping I believe it would have been a constant struggle, and possibly an unsuccessful struggle at that, just because it wasn’t what clicked with me at the time. Not to say I won’t ever flip, and I’m thinking about getting into it now, but I have to make sure it clicks before I do.
Because no one knows what will click with you, no one can tell you how to be an instant success. Not only do they not know what fits you best, you may not either! Taking time to feel out what really meshes with you takes research and experience, and therefore can’t happen overnight.
Well Isn’t That Depressing?
Sounds like it, huh? No, it’s not depressing. If you are only in real estate to get rich quick, not only is it going to backfire but you are missing the whole point. The point of investing is to build long-term wealth and financial security. Nothing long-term can be built overnight. Even if you are lucky enough to score a huge return in a short amount of time, if you are lacking the education and experience in how to do something smart with that money, you are going to lose it anyway. So there goes that long-term wealth idea! Just ask past lottery winners.
Moral of the Story
Be patient and put a concerted effort into it. It will pan out, promise. Just don’t get frustrated and quit. The end goal of course is part of the experience, but it is really more about the journey. So live it up!
Any stories about pursuing an investment strategy that really wasn’t you? What happened? Can anyone actually tell a story about an overnight real estate investor success?