There are always a laundry list of tasks that real estate investors need to do in order to ensure they are being a smart, strategic so they can be financially successful in their investing.
The problem is that most investors - don't have the time because they work full time jobs and it means they need to spend their evenings and weekends to do those investing tasks.
But most investors usually end up trying to shortcuts - which can result in a very very very expensive lesson - bad investing decisions..
Your time is valuable. Time is precious.
You only get so much time in this lifetime – it is truly the most valuable commodity you have. And when you work a full time job while also focusing on real estate investing - like most investors you may find yourself struggling with balancing it all.
Do this quick calculation in your head by asking yourself these questions
Here is an example to figure out how to calculation based on the questions listed above.
Jennifer is paid an annual salary of $75K or $37 an hour in for her 40 hour work week job.
She believes it would take her 30 hours to research all the cities in Georgia to help her decide which city to invest in.
This means that based on her pay rate of $37 an hour – she is “paying” with her personal time 30 hours which adds up to the cost for her to do the task equaling $1,110
But she has found a Virtual Assistant that can do this for $7 an hour – which means that when she hires them for 30 hours’ worth of work, she is paying them $210 for the task.
So by only paying out $210, she has achieved two very important things:
• She has freed up 30 hours of her personal time
• The task is completed at an 81% discount based on her hourly pay rate vs. how much she would pay a VA to do it.
Jennifer can now spend that 30 hours she would have done on that task - on things that she also wants to spend her time on. She can guilt free go out on that girls night, take that yoga class at the gym and spend more quality time with her spouse. And still get the task done!
So now you need to ask yourself - can you afford not to outsource and hire a Virtual Assistant. Is it too expensive for you not to hire a VA?
Note: This is an excerpt from our program Work Less...Invest Smarter Workbook (available on Amazon) - where we teach real estate investors how to find, hire and manage virtual assistants to help them be smarter more successful investors.
"By gambling we lose both our time and treasure - two things most precious to the life of man."
Speculative investors are gamblers in the truest sense. They have the best of intentions, and they really want to win big when they jump in to real estate investing - hoping it will fulfill their wealth dreams.
Unfortunately there are a lot of investors in 2005 to 2009 who threw money at deals while we were in that glorious bubble of real estate –it seemed like nothing could go wrong. They had big dreams of getting rich but didn’t do their homework on locations and properties. They just went with what someone told them was a good investment or they just took what seemed like a good deal on the surface. When the bubble was starting to burst, they didn’t pay attention to the market trends to know when to exit that property or market and lost a LOT of MONEY – and in a lot of cases – they lost the properties too. All because they didn’t’ do their homework and weren’t paying attention.
So I am sure you realize you can’t eliminate all risks in
real estate investing, but there are steps you can take and things you can do to reduce those risks and become a smart strategic and successful investor.
Strategic investors make investing decisions by doing their homework, (ever hear the phrase - dotting their “i’s” and crossing their “T’s”?) in advance and then keep an eye on their investments.
In evaluating where to invest they look at a city down to the zip code or neighborhood level – since not all areas in a city are good to invest in. Is this area a good fit for their investing strategy? Will they get the return they want on the property?
A smart investor will also do a solid due diligence on a property they want to invest in – rental history, repairs needed, financials etc.
Every 6 months or at least once a year they check in on a market where they invest or want to invest to make sure it is still a good place to invest. They evaluate the market (location) to see if it still has a healthy economy. They even look at a zip code an neighborhood level where they want to invest – to see if things have changed.
- Has the crime rate gone up in that area? – Sounds like bad news and maybe you should sell.
+ Has there been a new employer moved into the area? - Maybe this mean you should find more properties to invest in that area.
Strategic investors also know when to get help from others, when they don’t have time to do all those steps on their own time.
On a personal note – I don’t have spare time to follow all the best practices it takes to be a strategic investor, so I figured out how to outsource this work to virtual assistants.
Now I simply create requests and templates and have them do a lot of the leg work for me. For market analysis I created an excel template and listed website I want them to source the information from and they fill out the whole thing – while I am working at my full time job or out at the beach. The result is they hand me a spreadsheet that list all the cities in a state – and lists all
the critical information for each of those cities (unemployment, crime rate, vacancy rate, average house prices, average rental rates for that area).
So that just means all I have to do is scan that data and narrow it down to 5 to 15 cities in that state that I want to invest in – that match my investing strategy of buy and hold.
Next, I have my virtual assistants do research on all the zip codes in each of those 5 to 15 cities – so now I know within those cities – what parts of the city I should avoid investing in. I have to tell you it feels really good to feel confident that I had someone do my
homework for me- so I can make smart/strategic investing decisions.
I encourage you all to become strategic/smart investors too.
Let’s all get rich the smart strategic way – don’t gamble and hope you are making good investing decisions !
A lot of real estate investors are working full time jobs and find it tough to balance work, investing and their personal life. Investors who face this challenge usually end up falling into two categories:
Speculative Investors – These people are gamblers or rely blind faith and are hoping and guessing they are making good investing decisions.
Strategic Investors – Smart Investors who make sure they have
enough information to reduce their risk when making decisions about what city and what property to invest in.
So how do you figure out which one you are?
Try answering the following seven questions to find out:
If you answered yes to most or all of these – then Congratulations are a Strategic investor!
If you aren’t happy with the number of NO’s you answered– then take a second look at the questions and figure out what steps you should be taking to become one – and get started today!
You owe it to yourself to make sure you are making smart profitable decisions – leave the gambling for the racetracks or Las Vegas.
I grew up with my Grandfather and my Aunt both doing Real Estate Investing, so it's in my blood.