Recently I attended a three-day conference on real estate investing. The sales pitch for the event was along the lines of “Learn to buy and sell with other people’s money!” “Make money even if you have bad credit!” “Learn what millionaires all over the country do to make money while they’re sitting on a beach in the Mediterranean!” You get the idea. But, I figured at least I’d be in a room with a few dozen potential clients who wanted to learn to buy and sell real estate for three days in a row, so I registered.
After listening to a performance that was 90% up-sell for the $35,000 training program the organization was promoting I made a list of things you should NEVER do as an investor regardless of what you’re told at an event like that one. Hopefully this satirical will get you to LOL and not *face palm*.
1) Trash yourcredit. Max out your credit cards, borrow money at high rates of interest, ignore finance fees and over leverage your personal assets. Don’t calculate the cost of this money into your expenses on an investment project, that will just reduce the amount of money you’ll make.
2) Hesitate when you see a good deal. Think it over for a week or longer and then come to the realization that if it really were that good of a deal someone else would have snatched it up already. This is how the pros do it.
3) Hold out for a higher price when selling. The money you could make now is not as valuable as the money you might make later
because after all, inflation is just a scare tactic and the market doesn’t fluctuate, it just goes up and up and up! Ask all the folks who bought houses in 2005 and put them up for sale in 2007, they’ll tell you.
4) Never pay for work you can perform yourself. There is no reason to hire a real estate agent to list and promote your property, you can put it on Craigslist yourself and pick up a “For Sale” sign at the local hardware store. Contractors are over-rated; you can reroof your house, paint the inside and replace siding all on your own with a hammer and a paint brush. It’s not like you have anything else you could be doing that would be more constructive anyway, right? And definitely skip right through the escrow process and record that deed yourself. Title reports are a waste of time, you know the seller is the real owner because they called from your “We Buy Homes Fast” sign and told you so.
5) Never waste your time or energy on a back-up plan. That kind of negativity will just enable you to back out of the deal and being an enabler is bad. That goes double for folks who constantly ask, “What if…?” You need to eliminate any other possible outcomes from your equation.
6) Remain ignorant to disclosure requirements and contract law. What you don’t know can’t hurt you!
7) Don’t talk to or work with other investors; they are your competition after all.
