I never cease to be amazed by people who expect to get good at something overnight. I see new investors get into real estate all the time and somehow they get this illusion its some kind of fairy tale business where you can go from beginner to expert in a few short months.
Where does this idea come from? Why would anyone expect this business not to take the same toll to success as any other?
Real estate, like all other businesses, has five steps to success. If any one is weak the whole income flow is weak. It takes time, patience, constant learning and application of the basics to succeed and there’s nothing you can do to short cut the process except learn those basics and apply them until they work and don’t quit until you succeed.
The five steps are:
1. Locate Prospects
2. Prescreen Prospects
3. Construct and Present Offers
4. Follow Up
5. Sell Quickly
Show me a six or seven figure investor and Ill show you someone who’s conquered these steps but I doubt you’ll find anyone who did it all right in the beginning. There’s a lot of room for failure in these five steps and one weak link can snap your chain and sometimes you need outside help to spot a problem.
When I talk with students I find the biggest weakness is either number one or two. If you’re not locating prospects I can assure you the other four steps are irrelevant. You can’t buy houses from someone you don’t know exists.
You should have at least three things working to attract prospects and if you aren’t getting at least five to ten sellers calling you a week, something better change soon. If you have three things working and you’re not getting enough calls, here’s a hot tip…
You Only Have Two Choices
1. Do More Of What Works
2. Do Something Different
Geez, whats so hard about that? If you’re not getting enough calls, fix it. It won’t fix itself. Whining about no leads ain’t gonna get you any checks. If you’re not getting calls and not getting deals the problem is almost always lack of experience at prescreening. That means you’re getting deals but aren’t sure how they’re dressed.
I’ll grant you, it takes a lot of unmotivated sellers sometimes to find a good deal but many people work harder at finding reasons to kill deals than make them work. Prescreening means you have the ability to call the dead wood quickly but it also means you can spot the aces when they are dealt you.
Here’s a little checklist to tell the difference that might help you a little. A suspect is a worthless time waster and should be trashed immediately before it sucks you into the time vampire vortex. A prospect shows promise and should be pursued until you determine it’s a suspect or buy it.
Suspect (Time Wasters)
- No Equity
- Seller asking retail value (ARV)
- Seller won’t answer your questions
- Seller won’t allow you to buy ?subject to? and the debt is more than you’d pay all cash
- Instant equity offered by seller
- Behind on payments, in foreclosure or bankruptcy
- Vacant and ugly
- Loaded with liens and judgements
It really doesn’t take very long to learn the difference but those who won’t and think it’s not required will soon be in another business where they’ll make the same mistake again.
All businesses have suspects and prospects. Suspects will suck up 80% of your resource and produce no income. Prospects will make you rich if you focus only on them and quit giving away your profits trying to deal with people who don’t want to deal with you.
I keep telling everyone I can this is only a part time business with a full time income. If you crank up your buying machine and prescreen out the suspects quickly it only leaves you a handful of people to talk to and a few houses a month to visit for you to buy two or three deals every month which should put you in at least the mid six figure income bracket.
Will you be an instant expert? NO!
Give yourself a chance to get really good. It’s not your fault you don’t have all the answers. It wasn’t on your S.A.T. test. It’s a learned craft and well worth the price you’ll pay in time and money.
People ask me all the time how to become a good speaker.
First, you are a bad speaker. Same thing is true with real estate. You’ll make mistakes, blow some deals, take too long to sell, say the wrong things and get a few knots in your stomach.
Are you an adult who’ll do what it takes to get rich or a coward who’ll turn and run at the first roadblock?
Everything I do well now I did badly at first. I made a ton of mistakes in the 80’s and looking back, I was a blundering idiot.
When I started speaking I was horrible. Couldn’t put two sentences together without saying ain’t. I was scared to death and it showed. Only time and practice made me better and to this day I still do a lot of things wrong but make a strong seven-figure income during my blundering.
Everything I now do well I did badly at first. Everything I still do badly, I do so only because I never invested the time or study to get better. There are very few things I couldn’t master if I set out to do so. I know what it takes to get good at anything. The question is am I willing to pay the price? If I’m bad at it now, the answer is no. There’s no other reason. I can’t type, I’m lousy at sports, I don’t play any musical instruments and I’m 20 lbs. over weight. I know exactly why all these things are so. I’m too lazy or don’t care enough to fix them.
But I do know for sure if I ever choose to do any of them, I’ll really suck at it until I get good. And you know what? It won’t bother me a bit because I know it’s a requirement and I can’t change it.
Same is true for your business. Cut yourself a little slack and focus on steps one and two and I’ll bet the other three will get a lot easier.
Fortunately, you get to earn while you learn and get paid in big fat checks. Keep moving forward and soon the checks will get bigger, the work will get easier and you’ll be so proud of yourself you’ll be hard to live with. Amazing things happen to those who don’t quit.
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