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People reach out to me often asking for advice or best practices for getting started in real estate investing. I wanted to share some of the key things that I feel are most important to know if you are considering getting into investing or if you’re in the early stages of building a real estate investing business.
• Find a mentor you can trust. I can’t stress enough how important it is to find a mentor in this industry. Having a mentor when I first got started in real estate was key to my growth. Utilizing the benefit of someone else’s experience greatly reduces your learning curve. I wrote an entire article on how to find and nurture a relationship with a mentor.
• Define your goals. I think it’s safe to say we all get into real estate investing at least in part for the freedom it can provide. But what does that look like for you? How large or small of an organization do you want to build? What is the end goal you are hoping to achieve? Real estate is often just the vehicle to get us to a bigger life goal, so make sure you are casting a vision for your company (or yourself) that aligns with your goals.
•Educate, but be an action-taker. Many people sit on the sidelines spending way too much time educating themselves to the point where they are overloaded with information and become too afraid to take action for fear of making a mistake. While it’s always important to evaluate risk, it’s also important to take action on what you’ve learned and learn from your mistakes. It’s also worth mentioning that taking action on too many things can be detrimental, because you may end up chasing shiny objects and never accomplishing anything of real value.
• Self-evaluate. This is a tough one because you have to be willing to take an honest look at yourself. Where are your strengths and weaknesses? Once you know where you’re weak, hire out for those areas. Delegating responsibly is key to growing a business with a good foundation. For example, running appointments and managing employees are my personal areas of weakness. Once I realized this and was able to hire out those positions, my life became much less stressful because I wasn’t trying to force myself to do the things that didn’t come naturally for me.
• Automate where possible. With all the technology and resources out there, it’s counterproductive to waste time doing tasks that can be easily automated. Avoid getting stuck in the weeds by looking for areas in your business where automation can be your friend. This leaves you more time to do the things that will move your business forward.
• Track your marketing. Marketing is the No. 1 expense when getting started in real estate investing. By tracking your marketing spend and return on investment (ROI), you can see how effective your marketing is. This also allows you to make informed decisions about where and how to spend your marketing dollars, and understand how well your message is being received.
• Start small, and build a strong foundation. There are a lot of gurus out there preaching about growing and scaling an REI business, but remember, bigger isn’t always better. Scaling an operation that doesn’t have the proper foundation will only lead to problems down the road. Creating systems and processes, hiring the right people who are a good fit for your organization, and keeping a finger on the pulse of your business will lead to an operation that is scalable and successful.
It’s important to remember to build a business that fits into your life, rather than building your life to fit around your business. Otherwise, you’ll put yourself in a box that will never allow you the true freedom that can be achieved by investing in real estate. By focusing on these key points when getting started in REI, not only can you build a bigger business over time if you choose, but it will be a better business.
