Real estate is a business – plain and simple. You’ll need to plan, analyze, negotiate, write offers, manage, market, and sell just like any other form of business. A business does not stay in business for very long if it’s not producing a profit!
In real estate, there’s a certain level of commitment required, but that commitment pays off handsomely. And, unlike many other businesses, real estate allows you to control your hours and set your own schedule. You set the goals you want to achieve, and then you set out to make them happen.
As part of being a businessperson, the most important attitude any investor can have in this field is one of…objectivity! As human beings, we have a tendency to fall in love with certain houses or, conversely, hate them upon sight. Of course, this is a natural tendency since homes at their core represent security, safety, love, family, etc.
However, falling in love with or hating an investment property can be the biggest financial mistake you make. For example, assume you see a lovely, lovely ranch house located on a beautifully manicured lawn, and it’s love at first sight. You rush to buy it at a great price but without proper inspection.
Then, you discover it’s actually a “money pit.” That is, the plumbing has been leaking, and there’s water damage throughout the house. It’ll cost a fortune to repair, and you find that all your expected profits have vanished.” In fact, you end up with serious debt. That’s the kind of personal and financial damage a lack of objectivity can inflict.
Now, let’s look at it from the opposite point of view. You visit a home for sale, and it looks like a real stinker at first. It’s obvious the owner has neglected the property. The siding’s dented and needs painting…the yard is overgrown with weeds…etc. Because of this lack of “street appeal,” you automatically reject the house and drive off.
But, let’s say you get over your initial hatred of the house and make a very close and objective inspection of the inside and outside. Once you do that, you find the darned thing is actually structurally sound…the plumbing is in fine shape…the electrical system is up to code and working well…and so forth. Very soon, you realize that all the neglect is purely cosmetic. You’ve actually found a diamond in the rough! With a minimum investment, you can actually turn this property into a very profitable investment.
By now, I’m sure you get my point: In real estate, objectivity is everything. It’s the key to your success as an investor. So, remember, real estate is a business above all. It’s not a love- or hate-fest. In fact, think of it as a small business (in the beginning, anyway) in which everything is determined by the numbers. Always, always stay objective!