When we think of the Fourth of July we think about fireworks, grilling, and being with friends and family in celebration. I am a very big pyrotechnics fan, I always have a supply of fireworks for any occasion. If there is any excuse to launch a mortar or rockets, then I am very excited. Yes, I have gotten my share of injuries. I still have my eyes and fingers. The injuries healed. This is just like getting involved in real estate. You must know the risk and rewards when you buy and sell real property.
When I am picking out the right explosives to use in a celebration I have certain criteria. The mortars have to have color and reports. I also have rules in real estate. I have certain types of houses which I will buy and others I will pass on. I will pass on certain areas. I need to know what is the profit/reward ratio. The process I use has four simple rules. The first rule is to know what you are buying. Are you buying a house, commercial property, apartments, or storage units? How big? Get it inspected so you know what you are getting yourself into.
When I am shooting off the fireworks I make sure there are no trees which block the view or catch on fire. (This is a short funny story, ask me when you see me). I also need to know who is going to have my back when I have help lighting a display (this is a partner, mentor or coach). I had one friend who was new to shooting fireworks and he was lighting fire crackers. He was trying to be safe by telling others he was lighting them but he wasn’t using safety for himself. We were using cigarettes to light the firecrackers. So he was walking around with the cigarette and firecrackers in the same hand. This was not good. I instructed him that this was not a good idea. When we are buying a house we need to be safe and get it inspected. Once it has been inspected then we need to figure out what it will cost to put the house in good condition. Better yet, a condition which will suit our end purpose to make a profit. Considering your repair costs is the 2nd rule to know when you buy real property.
I am always looking to improve my fireworks display. I have graduated to a safer system and less work. The system I am using now, I learned from watching other people, mentors, or coaches. I am always asking questions on how to make my business better and be able to get to the next level. The newer safer system I use for fireworks, takes 3 times the work up front in preparation and one tenth of the work to set them off. It is a great balance. When I am looking at houses, I am doing my due diligence upfront, taking my time to make sure I am going to be able to succeed. This is the third rule to follow. I am willing to spend the time upfront to go over the risks and profits to make sure they are within the limits I have as a business model. This is the numbers part of the transaction. This small but important part will allow you to keep all of your fingers and hair. This is the fourth rule to follow when buying real estate.
Being educated about the potential types of fireworks and technology that is now being used in pyrotechnics is important to keeping yourself and others safe while having some fun and enjoyment. The first property you buy will teach you 80 % of everything you ever need to know. The second will teach you another 5% of what you need to learn. The other 10% you will never know because the market is constantly changing. The changes are in prices, areas, financing terms and market conditions. Always be learning. I spend at least a thousand dollars per year educating myself about ongoing updates in our field and learning the newest and best practices.
If you are unsure if real estate is for you, realize it is not a get rich quick opportunity. It is a slow and steady opportunity for financial freedom. The great news is you don’t have to die or get blown up by fireworks to reap the benefits of financial freedom on the fourth. I will be giving a training on Saturday, August 27, 2016, which will be a full day of learning about a simple real-estate technique called wholesaling. This training is a very affordable way for you to learn about due diligence, contracts, and determining if it is “a deal”. This is a simple, easy to understand training where you will learn from someone who has been on the street everyday looking for great opportunities for investment. GO to the Atlanta REIA's site now: wholesaling101.atlantareia.com because this event sells out every time we have it. I look forward to seeing you there and getting you started in real estate.