Should You Do Real Estate Full-Time?

Many self-acclaimed real estate gurus state that everyone should quit their jobs and immediately jump into full time real estate investing. They often claim incredible results from students with little experience. We would like to caution that life-changing decisions are not usually simple and that full time investing is not for everyone. Let’s discuss some pros and cons of full-time versus part-time investing.The Full-Time InvestorEntering into the real estate profession on a full-time basis offers several advantages over a part-time commitment. Being successful requires you to develop knowledge in many aspects of real estate, and more time focused on real estate leads to greater knowledge. The more your learn, the more you earn, since you do not need to rely on as many professional services or partners for help. You also learn to recognize a deal (or a dud) faster, which gives you more time to do more business or spend with your family.As a full-time investor, you work your own hours. When we say “full-time,” that may mean as little as twenty hours per week if you are good at finding deals. The rest of your time can be spent pursuing other vocations or hobbies. Or, if you are so inspired, you can work forty or more hours and use the extra cash flow to buy rental properties or diversify your holdings in the stock market. The point is that you need to satisfy your cash flow needs before you can start “investing” your money.One final point you should consider is whether you want to be “self-employed.” If you have always worked for someone else, being your own boss sounds very attractive. In some, respects, this isn’t quite the truth. Being your own boss means being an accountant, bookkeeper, stock clerk, receptionist and office manager all-in-one. You have to do deal with tax returns, payroll, office supplies, customer service, bills and all the other hassles that come with a business. You don’t have friends to chat with at the water cooler. You don’t have paid health insurance, a company car and a 401(k). You take your problems home with you every night. Sound like fun? It is, once you learn how to master your time and run your business. Being the master of your own life and career is well worth the other hassles of dealing with your own business.The Part-Time InvestorThe part-time investor holds a “regular job.” This may be by choice or for the time being until his real estate ventures are bringing in enough cash to quit his job. If it is the latter reason, don’t quit your job because the real estate “guru” told you so. Quit your job when it is not worth the income that it brings you. In other words, if you are making more money per hour flipping properties on the side, you are at the point that where your regular job is costing you money. Only then, is it time to quit!One of the advantages of starting out part-time is that you can maintain cash flow while learning the business. It may take weeks or possibly months to find your first deal. That same deal may take several months to turn around, especially if you decide to fix it and sell it retail. Think twice before telling your boss you’re leaving; you will have plenty of time to make the career switch once you have real estate experience. You may, on the other hand, like your occupation. If so, continue to work at it, and invest in real estate on the side.The best case scenario, if you are married, is to have one spouse work a regular job. The other spouse work the real estate business for creating wealth, retirement income and a nice college fund for the children. Of course, in today’s market, you could be laid off due to unforeseen circumstances. If you earn additional income flipping houses and invest the proceeds into rental properties, you will be covered if your main income is lost. This is especially the case for married women that often forego a career and raise a family, only to find themselves divorced with no means of making a living. We don’t want to sound cynical about marriage, but with a fifty-percent divorce rate in America, it never hurts to have a system for making money.Someone with a full time job tends to have little free time to focus on real estate. A part-timer should learn most of the same skills as a full timer. Thus, the key disadvantage to flipping properties on a part-time basis is that it takes sacrifice to learn the business. Something has to give; television, lazy weekends, meaningless hobbies and even some family activities must be compromised. As with any education, time spent learning about real estate will bring its own rewards, especially if the people in your life understand your goals and your plan to achieve those goals. If you are married, make sure your spouse reads this material with you and participates in the fun process of making money.Treat Real Estate as a BusinessPeople are lured to real estate because of the quick buck that it promises. Don’t hold your breath, you won’t get rich quick. An “overnight sensation” usually takes about five years. More than ninety percent of the people who take a real estate seminar quit after three months. Real estate investing should be treated with the seriousness of a career. It takes months, even years for a business to cultivate customers and have a life of its own. You need to treat it like any other business.

Marketing! The Pulse of Your Real Estate Business

In order to be successful as a real estate investor or basically in any other market, you must know how to market. Marketing is the pulse of your business, without a pulse, you flat-line and you DIE, no really, you are dead, or you might as well be because you aren’t doing anything in the business. You can be a newbie investor or a weathered one but if you “act” busy, it doesn’t necessarily mean that you are doing the things that count to increase your leads.MARKETING IS LIFE. You are not a real estate investor, well not precisely; real estate is just your vessel, your means of becoming financially independent. In essence you are a marketer. Learn this craft well; study it day in and day out. You must become the World’s Greatest Marketer, but in your farm area first. Baby steps, come on!! All of you insist on getting coaching, products, courses and real estate books. Those are all good and well but what about marketing? When does that come into play? Invest in some marketing books, they go a long way, even if they are in a different market, they all have great ideas and useful techniques to put into good use.I use many different types of marketing strategies on a day to day basis, but what helped me the most which I highly, highly recommend is… Guerrilla Marketing!! That is right, how I launched myself onto the scene was with several subtle but extremely creative and powerful Guerrilla tactics that can help any investor, especially the newbie investor. Oh man, I felt like a little boy at Christmas once I started getting my phone to ring off the hook!Shhhh, do not say anything, but what I am about to share with you are some of my secret, but really not so secret techniques that helped me get my phone ringing off the hook!! With this approach you can make $10,000 within the next thirty days if you start right now! Unfortunately some of the strategies I used involved hitting the streets, that’s right… you have to hit the pavement and I mean hard, hard like “curbing” as in American History X hard. Uncomfortable going out and about, well you might as well stay comfortable in your lousy life. In order to succeed you have to just do what it takes, remember, pain is only temporary but victory is forever.As I was saying, yellow signs, the oh so lovable 18″ by 24″ yellow corrugated plastic, how I loathe thee. Two ways to use them, the first is to attract sellers and the second is to attract buyers. Like anything else in the world, this is a numbers game and you must stay persistent. Every month, if your budget allows for it, shoot to purchase 300 yellow 18×24 corrugated signs, a pole stapler and either a red or black “KING” sharpie. You are going to write on 200 of them:WE BUY HOUSESFAST FOR CASHXXX-XXX-XXXXEvery week you will place 50 signs in high density areas, but use common sense guys. Do not put these signs on a highway!!! You are most definitely going to cause a car accident but most importantly you aren’t going to get any calls. For every 50 signs you put out, you will get around 5 calls of the highest motivated seller you will come into contact with, but in the end it will only result in a deal or two which is very good.At the same time, you grab the left over 100 signs and write:HANDYMAN SPECIAL!!HOUSE 4 SALEMUST SELL QUICKXXX-XXX-XXXXOr,CHEAP HOUSE 4 SALE4 BEDS/ 2 BATHSMUST SELL QUICKXXX-XXX-XXXXMost of you at this point are going to whine, “But Lou, I do not have a house to sell, isn’t that wrong?” After I am done smacking you, I will remind you that you are a Guerrilla Ninja and that you need to have an ever expanding Cash Buyers List. The beauty of this is that you will get tons and tons of calls, I mean tons. About 40% are tire kickers, 40% retail buyers, 10% wholesalers and 10% legitimate CASH BUYERS!!!!So once you have a deal under your belt you can quickly call and email the cash buyers to sell it quick! And since you placed all these signs in the same area, you will not have an issue matching them up to a property that they want. Also, since you have gotten in touch with some of the local wholesalers, try to get one of the deals they have and Joint Venture with them. It is the quickest way to make $1,500 and up for being the matchmaker between the two. And the more Cash Buyers you talk to, the more confidence you will have in shooting them out a deal when you are on a friendly basis with all these wholesalers. Wholesalers may be a little hard to get through the first time around but trust me, they only care about one thing and that is moving a property, and moving it quickly.But wait, there is more, I highly recommend you save all those phone numbers you receive so that you can market to them in different ways. It does not matter if the calls are coming from either Seller signs or Buyer signs, but save them and you can market to them as well. But those strategies are for another time. Anyway, this was a quick but simple overview of one of my favorite Guerilla Marketing methods, the Yellow Sign.Cheers!P.S. If you want to get some cheap signs I recommend you going to signwarehouse.com, they are very inexpensive there as opposed to the local sign shop.If you want some great books as well, I highly recommend the following books:- Guerrilla Marketing by Jay Levinson- Word of Mouth Marketing by Andy Sernovitz- Selling The Invisible by Harry Beckwith- Do It by David Newman