Real Estating Investing: Do You Have What It Takes?
Movies, sitcoms, and business dramas depict real estate investors as high-flying perfectly coiffed upper level executives with perfect suits and perfect hair, in reality while intelligence and good looks are a boon in any profession to invest in real estate you only need a few basic skills. Truth be told, most of the technical skills required for real estate investing are outsourced to professionals, however, there are a few basic traits that mark a successful property investor.
Basic social skills
While many people dream of being able to enter a room and instantly become the center of attention or the life of the party, all that is really needed for success in real estate investing is a basic ability to connect with other people. If you enjoy making new friends, whether you're good at it or not, and have a genuine interest in other people's viewpoints then you have the potential to build all the business contacts you'll need to build a solid portfolio of investment properties. Remember the old saying that it's not what you know but who you know. You never know how someone you just met or might need through a deal, even one that doesn't work out, will be involved in your real estate investment career. From investors to advisers, mentors or even future partners not to mention the local government officials needed for zoning changes or approvals, it's rare to meet someone who can't contribute to your investment strategy in some way or other.
For those with a genuine fear of meeting new people or being in social situations bear in mind that most of the people you need to be a successful real estate investor are there to help you and many are perfectly willing to correspond via telephone or e-mail. While wild the fear of public speaking may be held by many people, by the time you are called on to give a speech or presentation you will have had more than enough experience dealing with other people to comfortably share your success stories and secrets with your audience. Also remember that no successful relationship is one sided, many real estate professionals and even other investors will be more than willing to help you but make sure that they are receiving something of value in return, even if it's just offering to take them out to lunch.
Basic math skills
If you struggle to dial a phone number and are easily confused by property addresses in real estate investing may be too advanced for you. If you know how to use a calculator and a spreadsheet program on a computer then you will have no problem. For the most part the math involved in real estate is fairly basic in the more complicated math is generally handled by real estate professionals such as escrow companies or mortgage brokers. That being said, there is nothing wrong with looking for a basic math program online and brushing up a little, in fact, the best practice for honing your math skills is to go out and analyze some income properties.
Collection skills
This may be the one area of real estate investing where the average person finds their experience somewhat lacking, unless of course you're a parent. In this business it's very important that you be capable of asking other people to give you money, whether it's an investor, a business partner, or especially for tenants. Perhaps the most common mistake made by novice real estate investors is being to easy-going on their tenants, if you feel that this is an area that you may struggle with and especially if you don't feel comfortable with the accounting aspects of property management or if you simply don't have the time then you may need to seriously consider hiring a property manager. It may seem like hiring an accountant or property manager or other professional is too expensive in the beginning, however, in the long run a mistake in any of these areas could easily cost you tens of thousands of dollars. Real estate investing has enough difficulties without trying to do everything yourself, and by hiring and working with trained professionals you are developing the single most valuable business skill: leadership.
Basic social skills
While many people dream of being able to enter a room and instantly become the center of attention or the life of the party, all that is really needed for success in real estate investing is a basic ability to connect with other people. If you enjoy making new friends, whether you're good at it or not, and have a genuine interest in other people's viewpoints then you have the potential to build all the business contacts you'll need to build a solid portfolio of investment properties. Remember the old saying that it's not what you know but who you know. You never know how someone you just met or might need through a deal, even one that doesn't work out, will be involved in your real estate investment career. From investors to advisers, mentors or even future partners not to mention the local government officials needed for zoning changes or approvals, it's rare to meet someone who can't contribute to your investment strategy in some way or other.
For those with a genuine fear of meeting new people or being in social situations bear in mind that most of the people you need to be a successful real estate investor are there to help you and many are perfectly willing to correspond via telephone or e-mail. While wild the fear of public speaking may be held by many people, by the time you are called on to give a speech or presentation you will have had more than enough experience dealing with other people to comfortably share your success stories and secrets with your audience. Also remember that no successful relationship is one sided, many real estate professionals and even other investors will be more than willing to help you but make sure that they are receiving something of value in return, even if it's just offering to take them out to lunch.
Basic math skills
If you struggle to dial a phone number and are easily confused by property addresses in real estate investing may be too advanced for you. If you know how to use a calculator and a spreadsheet program on a computer then you will have no problem. For the most part the math involved in real estate is fairly basic in the more complicated math is generally handled by real estate professionals such as escrow companies or mortgage brokers. That being said, there is nothing wrong with looking for a basic math program online and brushing up a little, in fact, the best practice for honing your math skills is to go out and analyze some income properties.
Collection skills
This may be the one area of real estate investing where the average person finds their experience somewhat lacking, unless of course you're a parent. In this business it's very important that you be capable of asking other people to give you money, whether it's an investor, a business partner, or especially for tenants. Perhaps the most common mistake made by novice real estate investors is being to easy-going on their tenants, if you feel that this is an area that you may struggle with and especially if you don't feel comfortable with the accounting aspects of property management or if you simply don't have the time then you may need to seriously consider hiring a property manager. It may seem like hiring an accountant or property manager or other professional is too expensive in the beginning, however, in the long run a mistake in any of these areas could easily cost you tens of thousands of dollars. Real estate investing has enough difficulties without trying to do everything yourself, and by hiring and working with trained professionals you are developing the single most valuable business skill: leadership.
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