Are You Prepared For The Good Times & The Bad Times That Come Along With Real Estate Investing?
Just like everything in life there are good times and bad times and real estate is no exception to this rule.
If you are new to real estate investing you want to educate yourself so that you can think and act like a wise experienced real estate investor…
Experienced investors focus on economic fundamentals of the deal rather than allowing emotions to take over.
Positive emotions are acceptable such as celebrating the closing of your property or perhaps celebrating the huge spike of cash that gets wired into your bank account after the successful completion of selling a property…
It's the negative emotions that you must keep in check and that is why it is important for you to follow a proven system and model after a successful real estate investor that has accomplished what you desire…
If you allow your negative emotions to take over it can cloud your judgement and you could make a fatal mistake that's good cost you a ton of money…
In my real estate coaching business and in the 20-plus years of real estate experience I have gained I have heard countless stories of new investors that have allowed their fear and emotions to get the best of them…
One example of this is when an investor sells a property out of fear and frustration leaving tons of profit on the table…
Another example I see quite often is that new investors will get excited and accept any tenants they find for their rental units. This almost always backfires and will cost you a lot more in the long run. Remember that experienced real estate investors follow a proven system for selecting tenants that meet the approval criteria.
Success in business and in real estate investing is never a straight line. You must be prepared for the for the good times as well as the bad times.
Once you understand that there will be bad times you can build a contingency plan into your system so that you never have to worry about the bad times...
You are prepared for them well in advance.
A good example of this is to collect a reserve fund for maintenance and repairs. You can do this by ensuring that you have at least three months carrying costs in your account prior to purchasing a real estate assets as well as reserving a portion of the monthly cash flow that comes in from the rent that you collect...
As they say "an ounce of prevention is better than a pound of cure."
Now over time your reserve funds could be quite substantial but you must be a disciplined investor and allow the funds to grow so that they are there when you need them for maintenance and repairs.
I have seen new investors make the mistake of spending their cash reserves and then when tragedy strikes they have no funds available to cover the cost which ultimately leads them to make a bad selling decision…
I want to encourage you to learn from their mistakes so this never happens to you.
Another emotional mistake I see inexperienced investors make is falling in love with a deal.
Remember why you are investing... If the deal does not meet the approval criteria and return a solid positive cash flow you must be willing to walk away…
There is always another deal around the corner ***( especially when you know how to create the deal)
In real estate you never want to try and time the market. You want to invest for the long-term... This will also help you keep your emotions in check.
Now be honest with yourself here…
Do you have the emotional strength and devotion to stick with a real estate investment deal for 5 years, 10 years, or possibly much longer?
If you would like some help with your real estate investments or you would like to chat about how you can get started in real estate today following a proven system please reach out and book your complimentary strategy session now…
I look forward to helping you with all your real estate needs.
Until next time always remember " The More You C.A.R.E. The Less You Work"
Your real estate-based wealth coach,
Jeff Woods
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