The Key Questions To Ask Before Choosing A Real Estate Mentor
Part 2 in the Series
This report is the 2nd in a series that has been developed using research into the habits of overachieving real estate investors. When interviewing these overachievers, we discovered that most of them had the same pattern of habits. Habits that allowed them to deal with the obvious ups and downs of real estate -- habits that did not allow excuses to get in their way.
This series has been developed so as to share these secrets, habits and strategies so that you can learn from them... and become an overachieving real estate investor yourself.
In this 2nd part of the series we reveal the insights into 2 subjects: Choosing a Mentor AND the value of a system. We'll start off with the less controversial subject.
Your System
These overachievers all have one trait in common and that is they follow a real estate investment system. Whether their main strategies are buy & hold, or foreclosures, or renovations or flipping... these overachievers all have a proven system to follow.
Most of these overachievers have been investing for years, and even today they stick with their system. The system provides them with a proven step-by-step framework built to minimize mistakes and maximize profits. You can imagine that after following a system for years, and creating results with it, that it might get a little boring and very repetitive. Well, that's true. But more importantly that's the whole point of an investment system... boring and repetative.
An that’s the key, your job as an investor is to make your investment system so automatic, so systemized that it becomes boring. The mistake many investors make is getting their system working well and then altering it to put some excitement back into it. They look for adventure in their investments, when they should be looking for results! The last place an overachieving investor looks for excitement is in their investments.
There are many places in life where one can find excitement, go sky diving or ski racing, but DON’T create unneeded excitement in your real estate investments.
We have seen over the last 13 years, what happens when an average investor begins to get bored with their system. They start to lose their spark, they start to look for other investment opportunities but most damaging of all, they begin to mess with their proven system. This is called catching the invincibility or professor virus.
As witnessed over and over again, this virus gives investors a feeling of invincibility. They begin to believe that they, not their system, are creating these amazing results. With this virus coursing through their veins, they begin to write complex and confusing offers to vendors (so they can prove their expertise), or they start to buy property types or in geographic areas that don’t fit their system. Why? Because they feel invincible. When investors catch this invincibility virus, the eventual crash is inevitable. The moral is: Ego can get in the way of success if you let it.
The true overachievers fight the urges this virus gives. They stick with their system, knowing that they are getting closer to their vision.
The sad part is, average and below average investors not only catch the virus, they can also spread it! And that’s is especially dangerous. Because these gurus are feeling above their system, they begin to share their invincible wisdom with other rookie investors. They start to teach their newfangled system (an old system with their new, unproven changes) even though they've only been using it for a few years -- without testing it through a complete real estate cycle. Their enthusiasm and excitement spreads their virus to others more vulnerable than themselves.
I’ve seen people who have only ever bought 15 properties in their whole lives start calling themselves real estate experts. They train other people in a system that has never been tested in both up and down markets.
Let’s be realistic ANYONE can look like a genius or feel invincible in an up market and that’s why we see so many 'experts' out there in the market today, the market has been good for a few years in a row, making others feel invincible. One professor I heard speaking is so proud that they gladly tout on their web-site and marketing materials that they’ve bought 7 properties over the years. Someone with this little market experience can quickly spread their virus to hundreds of real estate investors – without even knowing that they’re doing these people harm.
Sadly, the real trouble doesn’t show itself until there the eventual minor or major negative market turn which will always occur and these ‘professors’ are thrown out of their element, scrambling to give people advice without having any experience; leading directly to disaster.
An Investor You’re An Obvious Target!
It is human nature to seek out "what's new" and what's exciting. All investors can do that. However it is important that you understand that, as real estate investors, you are an obvious target. A target for 'excitement', a target of the 'new world guru' promising quick and easy riches.
The difference is, when you are armed with a proven Canadian system already - you have the power to look behind the curtain a little further and ask the very tough questions. It allows you to cut through all the hype and baloney. These questions shift the power into your hands as you play the role of the Sophisticated Investor. Your one job in this role is to cut through all the hype and complete your own investigations. This applies to whether you are looking at a potential investment property or picking a mentor.
When you’ve completed the questioning process, and everything still looks good, that’s when you act… not before. Never allow yourself to become a lazy investor. You can tell if you are becoming a lazy investor when you start to use the excuse that you don’t have the time for investigating and simply dive in. Make sure that the system has the potential to provide you with freedom -- even after you stop working it. Too many systems out there work and provide you income - as long as you continue to work it for the rest of your life. That sounds an awful lot like a job.
Keep real estate investment in perspective; you’re buying a property worth tens (if not hundreds) of thousands of dollars, it is worth spending more time investigating the property, and the person selling it, than you do trying to decide what movie to rent at the local video store.
Choose your Guru / Mentor Wisely – The Key Credentials to Investigate
Having a Mentor or support team is critical. When we developed this series, we discovered that the majority of the overachievers hung out with like-minded investors and followed in the footsteps of someone who had already done what they wanted to achieve. This helped them see the landmines before stepping on them, and helped them achieve success more quickly. So we asked them all to give their insights on what to look for and what to look out for. The results surprised us in their clarity and the consistency between the interviews. Here's what we discovered:
These days, there are many people out there calling themselves real estate experts, many of whom do a great job. However even a below average investor can look like a genius in an up market, and if they are good speakers it makes them even more attractive to investors. Always go back to fundamentals. To help you choose your gurus look for people who have at least the following credentials:
1. CURRENTLY investing in real estate, using the strategies they’re teaching
2. An absolute bare minimum of 20 real estate transactions to their name, so they have the experience of dealing with different buying and selling situations.
3. Someone who has been hands-on investing for at no less than 5 years (absolute minimum), so they have experience in different market conditions. It is even better if they’ve been through a full up and down real estate cycle.
4. Someone who doesn't have property to sell you. If they are teaching you how to buy, and selling you a property there is a possibility of conflict of interest. Not in all cases, but just something to be aware of.
Additional Thoughts
There are many pretenders out there, some who are excellent in selling the I’m helping you story, when in reality, with a little What’s Behind The Curtain checking you can discover their real intentions. Make sure they are not pitching emotions, make sure they’re not pitching ‘act now or miss out,’ make sure they don’t put others down to make themselves look good. In other words, INTEGRITY and unwavering commitment to disclosure is critical.
Make sure you don't look for your investments to provide you with excitement. They are your financial goals, and your financial future. Don't allow others to steal your dreams and direct you off of your chosen path. It's easy to be distracted with the promises of quick riches - but it is focus that provides long term wealth.
Good Luck!
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Don R. Campbell is a Canadian Real Estate Investor best selling author of Real Estate Investing in Canada, consultant and the author of the proprietary A.C.R.E syatem To discover more about this system that has helped Canadians purchase over $1 Billion dollars in Real Estate Click Here...
