As many of my more loyal readers know I am a private pilot, though I'm not presently current. And the comparisons between real estate investing and my period of learning to fly are oddly similar. Not in function but in training and application.
Each day I wake up, check my emails and go to work. And each day I work with clients who;
- understand that I have their best interests in mind.
- aren't sure that I have their best interests in mind.
- assume I do not have their best interests in mind.
The last two can, frankly, be difficult to work with. Not personality wise but because they never really buy in to the fact that the more money I can help them make the more money I make. It's really that simple. Real estate agents can sell a house, make a few dollars and move on to other professions if they like. A lot are doing that right now.
But I'm 42 years old with a lot of really good years ahead of me. It is in MY BEST INTERESTS to make sure your best interests are being protected and that you will make money. If those two things are happening, who do you think you are going to call when you need a real estate agent?
Getting back to my flying analogy...
When I was learning from Felicia Barton how to fly an airplane I listened intently. And yes, I also checked her out and cross-referenced her knowledge. How? I bought books about flying and read. I bought DVD instructional pieces that taught me the same thing she did, as it turns out.
But let me be very, very clear about this. When I was in the air and the ground was a significant distance below me, and her, I listened and did what she said. It just seemed to me that if something bad happened she was going to suffer the consequences as well.
It was in her best interest to let me know all of her knowledge. To educate me. And to get me out there on my own. I didn't argue. I didn't debate. I didn't tell her what my brother-in-law's opinions were about her practice of flying. I chose her to teach me. Now it was my turn to let her do her job and learn as much as I could.
And when you have a controlling, Type A personality (High D for those in the know) you have to understand how hard it was for me to make my will and intellect submissive to hers on this subject. But it was the smart thing to do.
Flight instructors and their students get killed every once in while. The reasons may vary but I doubt seriously that the student had done everything the instructor had said or taught. Foreclosures happen in real estate. For the first time home buyer it may be because someone advised them and they chose to ignore the advice. With real estate investors a foreclosure is probably the result of defying the odds when it comes to proper due diligence and running the numbers.
Real estate investing has rules. Follow them. Hire a guide. An instructor. A counselor. Another set of eyes. You might think my fees are high and that REALTORS make too much money. So be it. How much does a foreclosure cost?
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wow! this is really interesting!
Deb - thank you for saying so.
Hi Chris,
I've got to learn this technique of yours. You are obviously writimg to your clients. I like it!
Bill Roberts
Bill. Thank you. I write to my clients far more than other real estate agents. Other real estate agents don't buy too many houses from me. Though some do. Some of the really smart ones. :) Now don't get mad people. But you know I think more real estate agents should own more property.
Chris, you always seem to write such great posts! Thanks!
I have a funny analogy that I give clients about Realtors and pilots. They're much alike.
If done properly, you never really notice them. In fact, you'll start to think they're overpaid. Then, you hit a little turbulence.
When the plane is rocking or the settlement was scheduled for three days ago, aren't you glad you have a pro in the left seat?
David - thank you.
Brian - I have used the same analogy though I've never actually blogged about it. Now I may have to so that I can beat you to the punch. :) But that is exactly right. The American pilot doesn't make $150,000 a year to let the computer fly the plane. The American pilot makes the money for whent he computer cannot fly the plane.
Chris - your investment posts are most informative. Thank you!
My hubby and I are in the process of adding to an investment portfolio that is a mix of stocks, mutual funds and real estate. We don't want ALL the eggs in one basket, but we want enough in any one basket to make a helluva omelet!
Currently we are rehabbing our fifth unit and we are operating on a buy and hold platform. We plan to hold a minimum of 5 years on the single family homes and 2-3 years on the multis. At that point we will do a couple 1031s and see if we can't increase the $$ value of the overall portfolio.
It only took me 5 years to convince my hubby to get into this. He is a real cautious type when it comes to money and, quite honestly, will drive ya nuts over it. But he's getting used to the idea of me saying "jump now" and he goes along with it. Not sure if he's humoring me or just doesn't want to hear me fuss. LOL
Chris, Great analogy. You have heard that the "ground is the enemy when flying".
We are the owners of a Beechcraft Baron and my husband is always, always learning just like in Real Estate, I am always, always learning..
Guess foreclosures are the enemy in our industry.
Carol - either way you get what you want, right? :) Anyway, sounds like you have a solid plan. Keep up the good work. And thank you for the compliment.
Margaret - Thank you for stopping by. I envy your plane...
Chris
I will be a guest on ALL ABOUT REAL ESTATE at 12 noon today. This is a live radio program. If you are up early enough hope you can listen in http://www.wcbm.com/ or you might want to give us a call between 12noon and 1pm. We can talk about planes and foreclosures. lol
The call in number is 410-922-6680
Chris,
Thanks for calling in to the show. You sound great on radio.Good voice!
Margaret - it was my pleasure. Hope the radio pays off for you!
Chris, I really love doing the show but frequently don't get much notice. Being a frequent guest and occasional back up host, it's fun taking the caller's questions and being able to give out good information.
It is great for my sellers to be able to share their properties with the listening audience. Buyers call in for a specific home that they are looking for.... Kind of like match making. I have had numerous Rainers call in this past year. Even did a show with the Raingods. Wonderful publicity for Active Rain!