Why Doesn’t the Successful Investor’s Advice Work For Me?

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I discovered through trial-and-error that what an accomplished investor writes in a book may not necessarily work in your market.

Let me explain.

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Case Study

I bought Tony Collela’s Investing in Mobile Homes with Land book a couple years ago and have since read it multiple times.  It’s a quick and informative read that outlines his rental business of mobile homes with land.  He gives a detailed account of the common repairs he makes to his homes, including using window units instead of central A/C whenever possible to cut costs.

Here’s the Situation:

We had just purchased our first land-home deal and were making the repairs to the home to get it rent-ready.  The outdoor central A/C unit had been stolen before we purchased the property (common in our area when buying REOs) so I thought we could put several window units in the home to save us some money after we find a tenant-buyer (to prevent these from being stolen as well).

I didn’t know my buyers’ expectations upfront and was trying to learn them on the fly with this first deal.  I knew going into this first deal that mobile home residents tended to have lower expectations for their housing; however, I wasn’t sure exactly what they were.

After a few showings, nobody was interested in buying a home that did not have central A/C.  Here’s a couple reasons why:

  • Investing in South Carolina allows you to avoid nearly all of the cold-weather issues that other landlords around the country must deal with; however, you must provide a working air conditioner as we have many Summer days over 100 F and humid.
    • Tony didn’t have this same need for air conditioning in his market because he was investing in the mountains where he probably saw highs of 80 F in the summer.
  • Putting several window units in that home would never have cooled this home in my opinion.  At 24 ft by 76 ft (over 1800 sq ft), the home is both large and long.

The Result

We decided to put in the outdoor central A/C unit (after we closed with our tenant-buyer to prevent theft.)  We received estimates for several thousand dollars from a couple of companies before going with a used A/C for about half the cost from the third company.

(The used seller gets his used outdoor units by putting in a new unit at a customer’s residence and repairing the older one.  He then resells these used units with a 1 year warranty.  This has been a great ongoing relationship that has saved us quite a bit of money.)

We spent more money than we had planned on air conditioning, but it didn’t ruin the deal.

Here’s what we should have done instead (and would recommend to those starting out)

  • Books can be great in providing general knowledge but what works for the author in his market may not work for you.  In fact, his strategies may be outdated or may be location-specific.  Anyway, you should probably take the author’s info as general knowledge and not necessarily as fact without further exploration.
  • I should have spent more time interacting both online and offline with investors in my area and in my niche.  Asking questions of experienced investors would have saved us the headaches that accompany so many new investors.

Photo Credit: mendhak

About Author

Aaron Kinney

Aaron Kinney has been investing in mobile home and land properties with his dad since 2011. He's been a full-time investor since mid-2014 and when he's not working on the business, he can be found reading, playing tennis, or going on adventures with his wife. He has some books and a blog that discuss various aspects of mobile home investing at his website and helps investors speed up the creation of paperwork here.

11 Comments

  1. Thanks for reminding all of us that any recommendations are just reference. Investors should always do their own research based on their local policies, regulations and customs.

  2. Amen Aaron, I’ve had to learn the hard way and revamp what I was told were the “techniques for being successful in real estate.” Every area is different. Some techniques and principles can be applied universally, and some can’t or will need to be modified to work. This all fits into our problem solver mindset. It’s harder than I was expecting, and taking longer, but I feel rewarded that I’m getting calls now from people I talked to over 6 months ago who are giving people my number and saying “give this guy a call, maybe he can help you.” That kind of referral is worth more than money because of the confirmation about what your doing.

  3. Great point Aaron. The kicker is that many authors don’t indicate what their market area is. This is one of the reasons why we prefer to go to our local real estate investor clubs and talk, relate and interact with people in our city. That is the best way to know what is going on how. And we stay away from investing in other areas, unless we go with someone knowledgeable of them. The “one size fits all” approach does not work in this industry at all. Only as a reference, if so.

  4. Books and courses can be very useful and valuable resources for a BASE of knowledge but you always have to be aware of possible changes for your situation.

    There can be regional differences with weather (Like you encountered) and there are always state specific quirks you need to be aware of. Time is big to. Laws, regulations and customary things change so great advice 10 years ago might not be as great now.

    Fundamentally there will be some things that are not likely to ever change.
    Things like try to find motivated sellers, buy for less than current market value, always try to get the best terms possible…
    Beyond really high level stuff like that anything can be somewhat variable.

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