Do not become a real estate investor if you cannot handle the following things, and these were some
of the things that I overcame from being a struggling real estate investor to the point
where I'm at right now, where I'm financially free and making a full time income just from real
estate investing alone. So if you want to learn how to do that, watch the rest of this video.
The first thing to know is that as a new real estate investor, you're not going to be getting
consistent paychecks whatsoever. In fact, you might be losing money. Now eventually you'll
get to a point where you'll have flips going on, you'll have rentals, you'll have different
projects and things going on where it does become consistent, and you have deals closing every
month or two, or every week or so. But when you're getting started, you might go six to
12 months without making any money whatsoever. And not only that, but you'll probably be down
some money because you're spending money on marketing and different business expenses.
So you need to be able to handle that. I was just talking with a guy and I think
he was a government contractor, and he was saying he makes like six figures per year,
he sends out one email per, and he leaves at like two o'clock. So if that's something you
want to do, go for that. But as a real estate investor, that is not at all what it's like.
What? You will have to build up some savings,
or just maybe just keep your full time job and do this part time while you're getting started.
And eventually what will happen is you'll put your first deal together, then you'll do your
second and third, and eventually, you'll repeat what you did to get those deals, and eventually
you'll become more savvy, you'll have more deals closing, you'll have bigger deals closing,
and you can build up some type of consistency. Some additional things you should do is I started
a YouTube channel, it helps me ... It brings in revenue every single month, so it's almost like
a rental property. And not only that, but you should also have rental properties themselves
because that can provide a significant source of income, especially if you're buying multifamily
apartment buildings. So in between the different flips, I have my YouTube, I have rentals,
I have different things going on, so that can help supplement the income when you're getting started.
The second thing to know is that you should not become a real estate investor
if you can't handle rejection and criticism, because there will be a lot of it. I can
guarantee you of that. You're going to have a lot of offers turned down, you're going to get beat
out by other investors just when you thought you had this property under contract, you're planning
it out. You might have a seller that backs out of a deal and you have to go after them. So you're
going to have to be comfortable with that. And before you even make an offer,
you're going to have to sort through tons and tons of leads. I mean, sometimes I'll send out
10,000 postcards just to purchase one property, so it's not like being a real estate agent where
you talk to your neighbor, they want to sell their house and boom, you have your first deal.
You got to be ... It's much more selective. It goes through ... To find a really good
real estate investment deal, you have to find something that's just ... There's an inefficiency
in the market and you have to be able to spot that. So you're going to have to look through a
lot of different properties, go through a lot of rejections to really find that one amazing deal.
Now that one amazing deal can be completely life changing and literally set you up for life if
you buy the right deal, but you will have to go through a lot of deals. And in terms of criticism,
you're going to have people from every aspect of life giving you pretty much bad
advice on real estate investing. You're going to have agents tell you that deals ... There's
no more deals out there. You're going to have other people tell you should get a normal job.
People are going to say what you're doing is a scam because it doesn't conform to their nine to
five idea of what an actual office job is. You're basically going to have to put on the blinders
and just focus in on finding deals, and my channel has a ton of information on how to find deals. But
you're going to have more criticism than you've probably ever experienced in any type of career
or endeavor because you'll also have sellers yelling at you sometimes and cussing you out.
When you send out 10,000 postcards, believe me, you get some interesting responses, but eventually
what happens is you just kind of like get numb to it and you're just all about finding deals.
When you find a good deal, it's the best feeling in the world, so all that other stuff doesn't even
matter. But I remember first getting started in real estate investing and really going like
six months without any deals, spending probably $10,000 on marketing, so not only have I not made
money, but I've lost money. People are laughing at me, people are saying it doesn't work, and
as far as you know at that point, you're like they're correct. So you really have to like dig
down deep and stay the course, and keep marketing, keep finding deals, and follow a mentor.
The third thing I want to talk about is if you don't have reserves, you should not become a
real estate investor. And by reserves, I mean like cash, credit, access to capital, because you will
be over budget sometimes. And when you're getting started as a real estate investor, trust me,
I didn't have any reserves either. However, you need to build those up as quickly as possible,
and that's why actually having a job can help because if you have a steady income, you can
increase your credit lines, you can ask your local bank for just a personal line of credit.
You need to expand your credit as much as possible because in real estate investing,
it's happened to literally everyone, you're going to be over budget on a project. I was
over budget $100,000 on a deal one time, and I still made money on that deal. But how many of
you would be able to get through a deal where you accidentally underestimated the cost by $100,000.
That could sink a lot of people. Fortunately, I built ... When my credit was really good,
I built up as much credit reserves as I could, not to spend it on Ferraris or what not, but
just to have that access to that type of capital. And the important thing to know about building
reserves is you want to do it when you don't need it. So you want to extend your credit line,
save up as much cash as possible, obviously, because there's going to be a point where you
are stretched out and when you're completely stretched out, you're not going to be able to
access capital. No one is going to give you alone or anything like that,
so that's why you really need to have a safety net there for your different projects.
And not only that, but there might be a good buying opportunity. So I have plenty of different
lines of credit. I have a home equity line of credit, I have personal lines of credit.
So if there was an amazing buying opportunity, I actually just purchased a property that was
a pretty good buying opportunity. I was able to access that line of credit to purchase that
so I didn't have to take out a loan or anything like that. And it was a pretty significant amount.
A lot of people probably wouldn't have been able to bring like $50,000 or $60,000 to the table
just to be able to close on this deal in a week. So there's really two re reasons
to have access to those reserves. Next up, do not become a real estate investor
if you don't have patience. Investing is one of those things where you can't just jump on every
single deal. You would be so broke. You would be bankrupt if you jumped on every single deal that
someone said was a good deal, because you'll have agents, wholesalers, different investors,
they all say it's a good deal, but you have to be super selective with the deals that you
purchase so that even if everything went wrong with that deal, you would still make a profit.
I know some investors and really they're kind of like big name investors. If I said their name,
you'd probably know them. Where they didn't even do their first deal for like six to 12 months
when they were getting started. So a lot of people get discouraged if they can't find a deal after
like a week, but I mean, there's literally investors that went an entire year looking
for deals and couldn't put anything together, but then once you're able to do that first deal,
then you just kind of repeat the steps you did to find that one, and over and over again,
and every single deal you get a little bit better. Something interesting about Warren Buffet is that
he's all about like waiting for that great deal. He'll go like years without actually buying any
types of stocks, and then once he sees a great buying opportunity, he'll jump all over it and
invest like billions of dollars. So I think he went like seven years without buying one stock,
and all he does is analyze stocks all day because he thought all of them were overvalued, which if
he says they were overvalued, they probably were. So you don't need to wait seven years to purchase
a deal, but you should be very selective. Like myself I have a minimum of criteria,
like depending on the deal for the most part, I need to make a minimum of $50,000
relatively easily. If it doesn't meet that criteria, I'm not going to purchase it.
There's always exceptions here and there, but you should have some type of criteria like that,
and really evaluate at least like 25, 50, maybe even 100 deals before you purchase that one.
Next up, do not become a real estate investor if you can't handle risk. Real estate investing
is risky. Now there's ways to do it where it's less risky. For example, the best way is just to
purchase a property at such a low price because you've done your marketing correctly and you've
evaluated your deals correctly where of the last ten deals, yours is probably the lowest. Of the
last ten properties that have sold on the MLS or in that area, yours is the lowest. That's
how you build in a lot of forgiveness so that if something comes up, because there's so many
risks with real estate investing. I've had shootings at properties, I've had evictions,
lawsuits, I've had a wall collapse. I've had so many different things you can't even imagine.
So there's always going to be some level of risk, and the way to mitigate that is just to purchase
it at such a low price and obviously, get insurance and everything like that
where if something does come up, you're prepared for it and you can handle it
and you can take care of it. If you can overcome those five things, not having a steady paycheck,
having risk involved, being patient, being able to handle rejection and criticism,
having reserves. If you overcome those five things, you will be able to become
a successful real estate investor. You can do this as a full time job. So thanks for
watching this video and watch this video right here, and I'll see you in the next one. Bye.