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MN real estate owners can’t afford NOT to hire the experts. May 7, 2008

Posted by minnesotarealty in Minnesota Homes for Sale.
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Maybe the wealthy achieve their success because they have been taught not to neglect the basics. Many people , for example, might harbor the misconception that successful investors are simply very lucky or that they’ve been blessed with some innate knowledge about money and investing.

That simply is not true.

What the wealthy do differently from other people, and what every successful Minnesota real estate investor does, is prepare. Good investors make sure to do their homework.

The ABCs of Property Investing author Ken McElroy relates the story of a client of his that became a client of his only after making an utter mess of his investment property. McElroy and his company manage properties for investors. In the best case scenario, a property owner will hire a property management firm at the outset, instead of making an attempt to manage his property from a distance. That is what this investor tried to do. He soon learned that the time commitment to manage his own property was unreasonable.

That wasn’t this investor’s sole mistake. The owner had neglected to even visit his property before purchasing it, so he had no idea it was full of criminals. He hadn’t bothered engaging a group of real estate investing experts who would have been quick to advise him to avoid that area, due to its high crime . It was not a good neighborhood, and he should’ve known to avoid it. In fact, he could have avoided it very easily if had he just done his research.

It’s easy to imagine the enormous amount of money he put into the rehabilitation of the building—an expense he could have spared himself simply by budgeting for the experts he so badly needed. There was no way to fix the problem of the property’s location; therefore, the building would never pull in much rent.

More often than not, the savvy MN real estate owner can’t afford NOT to hire the experts.

Successful property investors also tend to have a staggering amount of focus. That is why they’re rich. They decide on a target and they hone in on it until they are looking at one property. They already know what type of property interests them. As a matter of fact, they might make a specialty of apartment buildings or hotels or another kind of property. They constantly keep in mind what neighborhoods interest them and the age range of buildings they are willing to look at.

In the event that their top choice of neighborhoods does not yield anything that appeals to them, they move on to the next best, and onwards, but they never lose track of the acceptable parameters.

One key thing people learn from wealth is that money talks. They understand that one does not need to wait until a For Sale sign goes up in order to make a purchase. If an interested party manages to take the current owner by surprise, it is often possible to get a great price on a piece of real estate that’s not even for sale. And there are no competitors to outbid you.

The wealthy do appear to reside in a different world. For them, funds are always plentiful. They won’t worry in the event that a deal does not work out, since they know another is just around the bend. A person seeking to increase his wealth significantly by investing may be nervous about letting a deal get away.

McElroy suggests that the best approach is to remain detached, and to work under the assumption that every negotiation will end with the investor walking away from the deal. Most supposed deals simply aren’t deals, McElroy said. The savvy investor knows that it’s important not to get too committed to the concept of closing the deal.

Successful property investors know this stuff, not because they were born with this knowledge, but because they’ve been educated on the subject, or else they have taken the time to educate themselves. Anyone can potentially learn how to invest like the rich; it just requires research and practice.