So, you want to be a better real estate investor.
Where do you start?
Maybe you read some real estate books; maybe you take a seminar; maybe you study your local market like you’re preparing for the LSAT. In the end, though, you’re not going to get there without some firsthand help — from a friend, a relative, a mentor… or someone else willing to share their experiences, mistakes and lessons learned.
If you’re a regular on the BiggerPockets Forums (or even if you’re not and you just take a quick glance), it’s hard not to be struck by both the wealth of knowledge and the thirst for more information. So many investors on BiggerPockets have achieved incredible success — whether that’s making a million by age 25 or closing on that first wholesaling deal — and the forums are always abuzz with those asking, how did you find the property, what were the numbers… or more generally, how did you get there?
Here is a compilation of 25 of the best tips for real estate investing success from BiggerPockets members who were generous enough to share how exactly they reached their goals — and the most important things they learned along the way.
Remember to leave a comment letting us know which tips you found most helpful and which specific real estate subjects you’d like our members to weigh in on in future articles.
25 Smart Tips for Real Estate Investing Success
1. Knowledge, Time, or Money: Pick One
“There are three way you can contribute to a deal: Knowledge, Time and Money. The awesome truth is that there are very few people on earth that have all three. Pick the one that you feel the most comfortable with, and go find partners that can fulfill the other two. For new investors, time is your greatest asset. With time invested, knowledge will come. Knowledge will produce money. It’s as simple as that.”
2.”Smart Guys (Gals) Have Backup.”
“I quoted this from the movie Iron Man. Don’t be the person with a failed hard drive with no back up. Every investment comes with risk. In real estate, there are lots of moving parts. Some of it you can control, some you don’t. Every time you go into a deal, make sure to have Plan B — or even C — to manage the risk in case the house doesn’t sell, or if it doesn’t rent well. In the corporate world, they have a fancy term for it. It’s call ‘risk mitigation.’”
3. Know that There Are No Tips and Tricks That Can Save You
“That’s right! Success comes from hard work, dedication and commitment. Tip and tricks are meant to help. However, if you do not spend time studying the foundation of financial education and are not willing to put in the work to gain experience, you will have serious issues becoming a successful investor.”
–Huy Nguyen, Real Estate Investor
4. Educate Yourself Endlessly
“An investment in knowledge always pays the best interest.” — Benjamin Franklin
“A good start is BP’s Ultimate Beginner’s Guide to Real Estate Investing. Participate in BP forums and learn from others’ mistakes — you’ll make enough of your own. Learn how to research your local public records for lis pendens, probate, property appraiser data, etc. You can buy lists from pay sources, but you can also create your own for free online or at the court house.”
5. Take Action
“The most difficult thing is the decision to act, the rest is merely tenacity.” — Amelia Earhart
“Don’t wait to take action; do something everyday to learn, network or pursue a deal. Write an offer on an MLS listing. Just do something — because you will learn something new from every action.”
6. Be Willing to Do What Others Will Not
“The person who says it cannot be done should not interrupt the person who is doing it.” — Chinese Proverb
“You have no money or expertise? Drive for dollars, knock on doors, put door hangers on houses.”
–Bill Byers, Real Estate Investor
7. Get Hungry
“My 13 year old boy eats daily as if he is eating his last meal. He is constantly hungry — where is all that food going? Anyway, as a new real estate investor, I am starving, but it isn’t for food; it’s for real estate knowledge. During the time leading up to my first purchase, I couldn’t satiate my appetite for information. Twenty-four/seven I thought real estate. It didn’t matter if the topics seemed redundant… I wanted to know as much as I could from as many resources as I could. To this day almost every morning I listen to some kind of real estate / business podcast or audio on my commute. I’ve even bought a few high value, low dollar courses offered by some of our BP peers. This information has been pivotal in my growth as a new investor.”
8. Remember: You Can’t Manage What You Don’t Measure
“We need to manage our investments. Ben Leybovich says this “is a full contact sport.” What that means to me is I need to record all activity that has an effect on my properties. Some of these activities will simply go into the management bucket; however, there are many small expenses that are easy to skip over, such as priming an oil furnace that has been run dry or troubleshooting a 60,000 gallon monthly water usage bill by ultimately finding and fixing a leaky toilet. The list goes on and on. If we don’t track these things, we won’t be able to accurately gauge the performance of our assets.”
9. Believe that Failure is Not an Option
“I find when talking to other newbie investors that many times they are frustrated and not sure real estate investing is worthwhile. They typically haven’t done a deal and are still at the information consumption stage. For some this stage takes entirely too long, but that is another topic. It is important to take action in some way. Set small, measurable goals that will keep your …read more