Fight. Scrape. Strive. Bite. Kick. Claw.
Do whatever it takes to get to the top. Fight for your interests. Dominate the deal, and never give up until you win — by any means necessary.
We’ve all heard successful people talk about what it takes to make it to the top. A lot of hard work, dedication, guts, blood, sweat, and tears. Every finals MVP. Every Super Bowl champion. Every gold medal winner. They all say the same things:
“We had to overcome so much adversity to get here. We fought and never gave up.”
“It was such a grind all season long. We gave it everything we had.”
“I sacrificed so much to get to this podium. You could never understand how hard it was.”
Well, yeah. Of course we can’t understand. You’re not telling us! While it’s true that hard work and everything that goes along with it is a crucial part of success, it’s not the only part. Think of hard work like the motor that drives your success car. You can’t get anywhere of note without it.
But don’t you need a road to drive on, too?
While it’s not uncommon to hear people talk all about how hard they tried, how much adversity they had to overcome, and overall how awesome they have been, it’s much less common to hear them share what they actually did to get to where they are.
That’s what I’d like to talk about today — how to bring a win-win approach to this whole struggle to succeed.
How to Purchase Real Estate With No (or Low) Money!
One of the biggest struggles that many new investors have is in coming up with the money to purchase their first real estate properties. Well, BiggerPockets can help with that too. The Book on Investing in Real Estate with No (and Low) Money Down can give you the tools you need to get started in real estate, even if you don’t have tons of cash lying around.
The Road Map
I like to write motivational articles as much as the next guy. Motivation is important! But I also know just how frustrating it is when you go to someone more experienced than you for advice or direction, and you get a bunch of motivational rah-rah that doesn’t really help you out. Sure, they get my motor running. I’m red-lining over here. But I need someone to show me the direction to go if I want to put this motor to work!
The truth is, listening to a successful person tell you how hard they worked is really more about feeding their ego than it is about helping you. You don’t spend your time reading articles like this to feed someone else’s ego; you do it to feed your own thirst for knowledge and understanding. That’s why websites like BiggerPockets exist.
And, friends, you’ve come to the right place.
I’m here to tell you one of the big secrets about how to be successful in real estate, but the truth is, it will work for almost anything. The secret is, make sure everyone in your circle succeeds, too. You win, they win. That’s the win-win. This may sound too simple, but let me explain in a little more detail why this is so important.
Related: 5 Reasons a Positive Attitude Makes Winners in Real Estate Investing
Real estate is not an isolated industry. It’s complicated. There are so many pieces to every deal. There is the agent who finds you the deal, negotiates for you, helps manage your own roller coaster of emotions, and ties up the loose ends when they occur. There is the title company that has a crap-load of assignments to complete in order to make sure you don’t get swindled. There is the loan officer who gets you qualified for the loan and ensures the bank will deliver so you can close. And this is all just to get the house in your name! Then you have the rehab guys, the property managers, the loan officers, the insurance agents, it goes on and on. And each of these groups has its own employees to manage! Tons of moving parts.
As humans, we have the tendency to think it’s all about us. Win-Win isn’t a natural goal.
We don’t always recognize, appreciate, or communicate our gratefulness. And that’s assuming we even feel it.
If you want to be successful in real estate, you need to be good at — and I’ll even say have a competitive advantage in — all the aspects I just mentioned. If you want to do that, you need to make sure everyone else is finding just as much success as you.
This shouldn’t be a crazy notion.
How to Make Your Agent Love You
Let’s start with the agent. Your real estate agent has a tough job. They have to spend (*cough cough* waste) their time making phone calls, emails, and research, all to find you a property you might like. Trust me, you probably have no idea how many people are perfectly fine wasting an agent’s time, with absolutely no remorse. “Well, it’s their job” is the defense. Thing is, this “job” of theirs doesn’t pay them until you actually buy something. If you’re using them to research all these deals just to back out before you pull the trigger, they aren’t making money. You’re also kind of a jerk. Sorry if that’s harsh.
Agents learn pretty quickly who is going to help them make money and who is going to waste their time. They have to; otherwise, they won’t eat. If you want to find good deals, you need a good agent looking for you (assuming this is your plan). If you want an agent to bring you the good deals, you better be ready to actually buy them. If you don’t, why would the agent keep bringing them to you? Because it’s their “job”? No pal, if you aren’t buying the deals your agent is finding, it’s only a matter of time before she finds me and I start buying them. Then you’re straight outta luck.
And it’s not just me. There are lots of investors on this site who want to help agents make good money. For me, it’s a personal decision that if I say I’m going to close on a deal, I close on that deal, unless something totally drastic occurs. My word means everything to me, and if I tell an agent I’m going to close unless A, B, or C occurs, I close every time (unless A, B, or C occurs). Even if I think the money might be better spent elsewhere. My word is just that important to me, and I want everyone else to know it is.
Now, imagine you’re an agent. You have spent a few weeks hounding another agent about an REO listing they have that could be a great deal for someone who can rehab it. You know this is a “can’t miss” type deal. Are you going to bring it to the person who wastes your time, shows a lack of consideration for you, and doesn’t keep their word — or are you going to bring it to the guy who always closes and makes sure you’re taken care of as well?
This is a no-brainer.
Stop thinking of your agent has your employee. Start thinking of them as your partner.
Successful People Have This Figured Out
Ever heard that real estate is an 80/20 business? It means that 80% of the deals go to 20% of the people. This is true for investing, as well as for listings. Why is that? Because those 20% of the people have shown they have a reputation for looking out for everyone else too, and those people want to work with them.
All the whining, complaining, and table pounding about how “unfair” and “rigged” the whole system is will never change this concept. The good people take care of others. So others bring them deals.
These people build wealth while others build frustration.
It’s not just real estate agents. It works the same for loan officers, banks, construction crews, and property managers. If you make sure others get paid on time, make a profit, and are considerate of their time, they will repay you with better work, better opportunities, and better deals than they give to others.
I’m able to buy and rehab properties to flip or to hold that others can’t. Why? My rehab guys can do the same job cheaper than yours can. Why is that? I give them bonuses for jobs well done, I always keep them working, and I choose materials that are easier for them to install. I care about the rehab guys, and I want them to be just as successful as me. This in turn makes it easier for them to care about my needs, and they show that by pushing my jobs to the front of the line, making the extra effort to find me cheaper materials, and charging me less for labor than others do.
Don’t believe this mumbo-jumbo? Ask Brandon Turner. Brandon told the story once of a time he showed up at a bank and basically told them how lucky there were to be getting his business. He showed them how many houses he was buying, how good his numbers were, how good his track record was, and how much they were going to make. Brandon was actually right about everything. Still, the bank turned him down.
Makes no sense logically, but that banker didn’t feel like Brandon was looking out for the interests of the bank, so he dropped him. How did Brandon respond? Well, he went home, put together a packet of his projects and history to show the next banker, put on a suit, and showed up offering everything he could do for the bank this time. He showed how he would keep the bank’s money safe, how much he appreciated their opportunity, and how many referrals he could bring them. Guess what? This time it worked, and now he does business with them all the time.
Now, if a banker, a person who is trained to look just at the bottom line, can be swayed by this kind of approach, who can resist?
Tips for How to Apply This in Your Own Business
Want to get better interest rates or lower closing costs on your loans? Work hard to send your loan officer more referrals. She may cut her commission to help you out. Win-Win.
Want to convince a portfolio lender to lend to you? Find out what their bank is looking for. At different times in their business cycle, banks are looking for more deposits (to build up their capital) or more loans to give out (to make money off that capital). If you can figure out what they need at that time, you can figure out how to give it to them. Whenever I meet a new lender, I tell them I am willing to keep a sizable deposit at their bank. If they are looking for more money to bring in, they will start to salivate. Don’t have large amounts of money yet? Tell them how many referrals you can start bringing in, then work hard to do that. Show them your value. Win-win.
Want to get the inside scoop on distressed property before it hits the market? Follow the advice of Sharad Mehta (BP Podcast #155) and buy a bottle of wine for your title officer after every deal. Be like Sharad and use the same title company for every deal. He makes sure his people get paid and are taken care of. They in turn thought of him first. Win-win.
Want to get better quotes on your rehab work? Ask your contractor what work he can do himself without subbing it out. Then ask him what work he prefers doing the most. Odds are, he’s going to give you a much better price on labor if he’s better at it and it’s faster (maybe he loves installing laminate floors) than if he hates it and it’s slow progress for him (maybe he hates installing and cutting tile). My California guy loves building tile showers. He gives me a great price to do them. So I put a tile shower in every property, even if you wouldn’t think it would make sense to do it, just because the price is so good. He makes money every time, so he keeps giving me the awesome price. Once I learned this, I started asking every contractor what work they do best. I try to avoid the stuff they hate and only do the stuff they love. Guess who gets the best prices on their rehab quotes? Win-win.
Want to get better service and a lower rate on your property management fees? Ask your property manager which areas they want to manage in, and don’t buy in areas they don’t like. Bring them multiple properties to manage. Refer your investor buddies to them. Make their job easier. Make them love you. You are way, way, way more likely to get better rates if they really want to keep you around. Win-win.
Advice for Newbies
If you are new, you are at a disadvantage. You don’t know anything. You don’t know anybody. You don’t have any experience. You don’t have any money. You probably don’t even know what you don’t know yet. It sucks for you.
You’ve heard a thousand times “find a mentor.” You’ve probably tried to do it. You reached out, asked about the obligatory cup of coffee, and waited to see who would meet with you. Odds are, you didn’t have earth shaking success.
Why is that?
It’s because you didn’t think about how to bring value to the one you want to be mentored by. You were thinking “win.” You didn’t approach them with a win-win mentality. You came and said, “I want this. I asked, now give it to me.” No one is inclined to help that guy. You don’t want to be that guy.
A much better approach would have been something like, “Hey! I heard you on ____, and I love your approach regarding ____. I’d love to know what new project you’re working on to see if I can help get the word out or to know how I can help you overall. These are the things I can offer: ____.”
Now, if you had said that, you might have received a different response. In my opinion, one of the most frustrating things in business (or real estate) is how many people want something but don’t want to give anything. It’s backwards. My resources (time, deals, money, patience, advice, etc.) are limited. I can only give them to so many people. What makes you more deserving than the next person? Start asking yourself this question, and start looking for ways to help others. If you’re not willing to help others succeed, in all honesty, you don’t deserve to succeed and should not be expecting others to help you.
This is what no one is really telling you. The victory doesn’t always go to the one who tries the hardest — who grinds, hustles, or bleeds the most. So many people from this site hit me up with their “wholesale” deals, blowing up my emails with things they claim are an amazing opportunity — then can’t even provide one comp to back them up. It’s pathetic. The world does not need more of these people. If you are one of these people, please stop. If you want to have success in this business, you need to believe you can provide value to people through something relevant, and your confidence should flow from that place.
It’s not all just the hustle. Not the amount of hashtags you can use in a day. Not the blood, sweat, and tears. It’s not about blasting thousands of emails that no one even wants every day. It’s not just a “numbers” game. It’s actually a people game.
If you are one of those who find themselves always frustrated, complaining about the “system,” and resigning yourself to believe that the “little guy” just doesn’t have a fair shot, I’m here to say the problem is not the “system.” The problem is your attitude. You’re approaching it wrong.
The real key to success is in helping others succeed first. The law of reciprocity guarantees they will remember you and look for ways to pay you back. This is something anyone can capitalize on, not just the rich, lucky, or good-looking.
Look for ways to make sure everyone you come in contact with becomes a winner, and you’ll find yourself not only in the company of all winners, but a winner yourself.
Investors: What ways have you found to provide help to those in the industry? How do you create mutually beneficial win-win situations in your business?
Let me know your thoughts with a comment, and let’s talk!