7 Harsh Realities of Successful Real Estate Investing

There are some realities to being a successful wholesaler or real estate investor, and failure to realize them can affect the success of your business.Even though real estate investing can be done by everybody, not all are successful at it because most people don’t know what it takes to succeed as a real estate investor. Below are 7 harsh realities of real estate investing.

wholesaling houses

Say AHHHHH!

1. There is No Such thing as a “Magic Real Estate Money Pill”

I talk to a lot of different investors on many different levels. A lot of times I get the same questions from newer real estate investors. “Alex, how can I make $20,000 in like the next 2 weeks?” I want to have 300 leads from motivated sellers like RIGHT NOW! How can I convince motivated sellers to sell to me for 50 cents on the dollar?

I have something shocking to tell you here so listen up! All of those things listed above are 100% POSSIBLE! Unfortunately, nobody wants to put in the work to make it happen!

One thing you must understand is that the simple act of investing in a real estate training course will NOT solve your problems. It is up to you to TAKE action and get things moving in the right direction.

While one big deal in real estate could make you a crapload of money, for the most part, learning the real estate investing game is a process and it will take hard work and effort on your part to be successful. The only question is, “Are you willing to do what it takes?”

2. 20% of What You Do Will Make You Money. The Remaining 80% will Suck Your Life Away

I see the truth in this important fact more and more in my real estate investing business. I cannot tell you how many times I get to the end of the day and I am like “Where the freak did the day go and what the freak did I get done?”

It is so important to identify what your actual money making activities are and to avoid the other time sucking activities like the plague. A good way to handle them is to outsource them, at least that is what I do.

Some time sucking activities include, getting the design on your company logo just right (dude, nobody really cares), figuring out if your website design matches your company logo(that nobody still cares about) and making sure your business cards look professional enough and oh yeah, match your company logo and website(which BTW nobody STILL could give too hoots about).

You get the idea of what I am talking about right? While making sure you have a website to capture motivated seller leads and killer business cards is all well and good what really makes you money is getting your marketing out there. This could be bandit signs or direct mail pieces or whatever else you can scrape from all those real estate investing courses that you bought… lol…

One thing you and I have in common is time. We have all been given 24 hours in a day. The one thing that determines wether you will be swimming in cash or food stamps will be how you use those hours.

3. You Cannot Isolate Yourself from Your Local Competition

I have to admit that this is one of those things that I struggle with. I have a very competitive nature and my natural reaction is to really TICKED OFF when I see other investors in my local market doing deals. Although I should not, I think of it as money being ripped from my pocket.

The advantage to working with your local competition is that you can leverage each others time and efforts. Specifically, you might not have a deal for one of your buyers at  a particular time or your wholesaler buddy down the street might have a deal with no buyer. You see what I mean?

You can leverage his marketing for that month and he can leverage your buyers list. In short, you split the deal with him and everybody make money! In th words of one of my former employees, “Some money better than NO money.”

4. For Long Term Success Marketing Dollars Are a MUST

I will tell you the difference between a successful real estate investor and a broke real estate investor. The successful real estate investor has a consistent stream of motivated seller leads coming into his business and the broke real estate investor keeps asking,” Man, how did you get that deal?”

The fact is that the successful real estate investor has learned to view his business as just that; a business and NOT a hobby. While it is possible to get deals from networking with other others wholesalers, mining the MLS and going out door knocking, the quickest and fastest way to get people calling you is to market and to market it costs money…DUH, right?

If you want to stop CHASING deals and have deals come to you.. the best way is to invest in marketing for motivated sellers…BOTTOM LINE

5. Your Efforts May NOT Yield Results or MONEY the First Time

Heres a kicker for you..lol.. Let’s say you get my message about need to spend money on marketing for motivated sellers. You go out and put up a whole bunch of bandit signs or send out a whole bunch of post cards. Your phone starts to ring, YAAAAY!

A week goes by and you realize that you have not put a single house under contract and worse yet you just spent a couple hundred bucks on bandit signs with nothing to show for it except for the dark circles under your eyes because you stayed out till 4 in morning standing on top of the hood of your car and dodging cops to get them out there (this is why I outsource this one…lol)

Wait now,  it gets even better… You go ahead and brave the elements again and do the exact same thing. The phone starts to ring again YAAAAAY! You start talking to some more sellers and you get this weird pattern that most sellers want FULL price for their house without having to pay commission or closing costs. I did a funny video for you on that BTW…check it out here

While this is a sad and frustrating story… you might find it to be true in your real estate investing business. What I am getting at is that even though you might get results from the first 3-10 tries and it costs you a few hundred bucks each time, you have to learn the power of ONE.

The power of one deal means that ONE deal could make you 10,000! Which means you are out about 1000 bucks for all your marketing attempts but you get to bring home 9000!  What if it was only 5000? Well you get to bring home 4000.

The point is that if you gave up right before that deal that came in, all of your efforts may have been for naught.. Don’t give up because the power of ONE is just too darn good!

6. You Must Embrace Technology

I cannot believe how many real estate investors just refuse to accept where technology and the web is taking us. If I were to go back to some of my old real estate investing courses on my shelves and blow the dust off them there would be hardly any mention of marketing on line (this is like 8-10 years ago)!

It is incredible how far technology has advanced over the last 8-10 years and continues to advance and a mind numbing pace.

Here is a piece of technology that will be off the real estate market pretty soon ====>CLICK HERE<====I have used this piece of technology in my business and it has put me LIGHT YEARS ahead of where I used to in a very short time. They have cut the rates on it drastically so everybody can get a piece of the action but it is going to be taken off the market by Midnight tonight!

Shameless plug I know, but GET WITH THE TIMES!!

7. Flipping Houses is a REAL Business

With all of the different gurus marketing so many different products and methods of real estate investing it can tend to get overwhelming! It seems to me that a lot of people out there get caught up in the dreams and visions of what flipping houses can do for your lifestyle.

Don’t get me wrong, there is nothing wrong with dreaming but when the glitz and the glamor fade away and you realize that you are left with just YOU, it can get kinda scary. You are the one that has to TAKE action to make things happen and YOU are the one that is responsible for the outcome that directly affects your family’s well being.

Flipping houses like a business means making business decisions and running it like its a business. Keep track of your costs and your numbers. The better you are at tracking your efforts the more efficient you will become and the better off you will be.

Leave a Comment! Let me Know what you think!

Twitter Digg Delicious Stumbleupon Technorati Facebook Email
  • Angelber1

    Boyyyyyyy Alex you hit it right on the nail…. thanks for this encouraging blog it came at a perfect time for me because I am exactly in that spot. After a year of going through courses I finally made the jump to just do it October of this year. I implemented my direct mail campaign in a virtual market where I havent gotten great results therefore I chose to do another market that may be better but I have felt exactly what you said here and just wanted to give up because my resources are tight but reading this lifted me up to keep that 1 deal mentality.

  • Ken

    Great Article — I was talking with a few clients this week while I am on an early thanksgiving vacation — all of whom are real estate investors and one of whom is cycling through $7M in this marketplace currently….and what you said is right on!!

    Keep up the good work!

    Ken

  • Jp Moses

    Awesome article, my friend. Very heartfelt and true through and through. Wholesaling is a BUSINESS and if you treat it as such (with realistic goals, expectations, marketing, etc.) it will pay handsomely. But far too many of us expect it all to happen overnight or close to it.

    Thanks for posting awesomeness. Alex Joungblood is A-OK in my book…no matter what everyone else says about you. 😉

    …jp

  • Anonymous

    Thanks JP!

    What ARE others saying about me? …lol

  • Eustorgio

    whats the deal Alex… just wanted to say THANX 4 always keeping it REAL!!!! This blog is by far the best 1 you have done…not 2 say that the other 1’s sucked but you know what I mean ; ) LoL…have you realized that you are an inspiration 2 all the newbies out there who hasn’t closed a deal??? Truth is you are!!!

  • Great article Alex!!! When I see new folks get involved in wholesaling they sometimes have an unrealistic expectation in relation to the effort they put forth. When starting out there has to be massive action to generate a ton of leads to find that one motivated seller. Unfortunately after taking 20 to 30 calls and they don’t get a deal they get discouraged and quit. I like your article because the secret is to embrace your 7 steps. Good job!

  • This is a great article Alex. A business does not come in a box…, that box may provide some tools; however, it is up to the individual on whether success will occur.

  • WOW! Great post.

    You know, a lot of people knock some of the guru courses, but I think they can be a big help for new people. When I started, I got a copy of a Ron Legrand course on ebay for about $100. I learned a lot from that course and it really helped me to be able to understand how everything ties together. One of the hardest parts when starting is putting it all together and knowing what questions to ask. Anyway, this is just what came to mind when reading the first section about taking action.

    We are a lot alike with respect to isolating ourselves from our local competition. I’ve always been taught to keep everything secret regarding my business. Didn’t want my ideas stolen (even though most ideas are from other people anyway). We learn so much more when we are willing to share the info with other people and open up a dialogue. I am just now showing everything that I am doing on my blog. It’s very weird for me and I don’t feel completely settled about it yet. But, I know I am doing the right thing.

    Great blog and again, this is a spectacular post!

    Danny

  • Info

    This is so true. Thanks for sharing.

  • Lakeishajordankee

    Love the post Alex!  Thank you for sharing and don’t stop, it helps!

  • quicklearningscyhools

    Appreciating
    the time and energy you put into your website and detailed information you
    provide.

    It’s
    nice to come across a blog every once in a while that isn’t the same old
    rehashed

    information.
    Wonderful read! I’ve saved your site and I’m including your

    RSS feeds to my Google account