This is Part 1 of a series on how to get started in real estate. Each new installment will be a bite-sized tutorial gleaned from 30 years of investing experience. The goal is to remove as much doubt and fear as possible, so you’ll begin, or continue, the process of creating enough passive income to change your life.
This is just for readers of this blog, so if you have friends who could benefit, let them know how to get the information. I welcome comments and I wish you a speedy and fruitful journey!
Real estate ownership is a time-proven way to create extra income, and in some cases, significant wealth. The allure of reaping passive income while you work, sleep or travel draws many to the industry.
I can tell you from personal experience that passive income is a powerful force. The cash flow and income provide the means to make dreams come true. That statement has been validated repeatedly as I meet friends and acquaintances who have created fantastic lives through real estate investing.
Are these people special?
They’re normal people, just like you and me. They breathe the same oxygen and make many of the same mistakes as us. What sets them apart is that, at some point in the past, they decided to start.
In any new endeavor, sometimes the hardest part is to begin the process. That holds true for learning how to invest in real estate.
What Holds You Back
You might feel paralyzed, helpless, or unwilling to dive in because of negative thoughts that might enter your mind. Do any of these statements sound familiar?
- “I don’t have the money.”
- “I don’t know anybody in the business.”
- “I don’t want to lose money?”
- “I don’t have the time.”
- “I don’t have the knowledge or experience”
- “My city is too expensive.”
- “It will detract from my medical career.”
The list can go on and on. If you think too deeply about any of the statements above, you might never get to first base. The purpose of this series is to dispel the myths listed above. As you learn more, those thoughts won’t be part of your vocabulary.
Your Personal Reasons (Find Your Why)
I’ve found that the simplest way to start something new is to determine WHY I want to do it. I know, I always find a way to bring WHY into the equation. Well, there’s a reason.
You have dreams and desires. Extra income will give you more choices and more chances to achieve those dreams. Your WHY will be the mission statement that will guide your decisions and keep you from wasting time of effort that doesn’t support your goals. As Stephen Covey said in The 7 Habits of Highly Effective People, “Begin with the end in mind.”
Creating income through real estate is simple, but it’s not easy. The steps are straightforward and not complicated, but people and nature will create challenges. Pipes will burst, tenants won’t pay rent, and property taxes will rise.
Some of these challenges will be small, and others will initially appear insurmountable. If you don’t know WHY you put yourself in that situation and what you expect to get out of it, you’ll quit.
And that’s often one of the greatest real estate hacks available – don’t quit!
Your reasons for embarking on a real estate career will be personal, but might include some of the statements below:
- “I want to quit my job.”
- “I want to enjoy my job more.”
- “I want to pay off student loans.”
- “I want to own my time.”
- “I want my family to be secure.”
- “I want to see the world.”
- “I want to prove to my dad that I can make it on my own.”
- “I want a vacation home.”
- “I want to be relaxed and not pressured all the time.”
The list can be endless. Insert your driving force and you’ll understand that if it’s strong enough, you will persevere through the inevitable hardships that will be encountered as a normal course of business. If you hang in there long enough, and give it time, most problems will be solved.
That’s another excellent real estate success tactic – time! If you persist long enough, time can make a bad deal look good and a good deal look great!
Give Yourself a Break
Real estate isn’t rocket science, nor is it a walk in the park. You must be determined to use it to create the results you want.
If you’re “Type-A” like me, you want to want to own a big apartment complex, or the Plaza Hotel for your first project. That can be intimidating.
Here’s a tip: Don’t try to do it all at once.
Set small goals. You don’t have to be the next Ted Turner or Donald Trump. That’s too much pressure. Maybe you would like to have just enough extra money coming in to pay for a babysitter so you can take your spouse on a date?
After that, try to create enough income to cover your electricity bill, or the mortgage on your home. It’s a surprisingly empowering feeling to know that your mortgage is covered every month, whether you work or not! After that’s covered, find another small win to shoot for.
Real estate ownership can be dialed up or down. So don’t be intimidated. Pick a result and get started.
Decide and Get Started
Once you decide WHY you want to be in real estate, and what you want to do with the income, you’ve crossed the first and most important hurdle.
If you’re like me, you want all the information at one time so you can dive in and understand everything today! It took me a while to realize that it’s functional and less stressful to master one step at a time so I can move on to the next.
The passive income that comes from real estate ownership is a game changer, and I desperately want you to have the tools to win that game.
So, I’ve decided to put out small, easily digestible nuggets that can be consumed and mastered at your own pace. Some of you are far along in the process and this will hopefully be a good way to review your plan. Others are new to the game and these steps will help you gain confidence.
Each installment will move us deeper into the mechanics of investing in real estate. At the end of the series, my hope is that you will have enough knowledge and confidence to get in the game and continue the learning process.
Every journey begins with the first step. You don’t need to have the entire trip planned out. Start by determining why you want to invest in real estate. That will get things rolling. As Martin Luther King Jr. said, “You don’t have to see the whole staircase. Just take the first step.”
To your success!