A Formula For Beginning Real Estate Investing

By: Michael Shuster
Submitted: 2008-11-15 20:46:50
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You don't have to see the whole staircase, just take the first step – Martin Luther King

If you are a beginning investor, the world of investing can seem daunting.  So many opportunities present themselves that it's very difficult to know what to do.  You have many questions and concerns.  Which type of investment is right for me?  How much do I need or should I spend?  How can I minimize my risk?  What will be my return on investment (ROI)?  And so on.

You may be at a standstill with investing.  You've looked around for a while.  You've read some books, watched some programs, maybe even attended some seminars.  You have a fairly good idea of what's available and what you want to do.  But you haven't acted yet on anything.   

What you need next is momentum.  What do I mean by that?

Let's define momentum.  Momentum is defined as a "strength or force gained by motion or through the development of events".  Momentum is when things are moving along to the degree that there is no more stopping.  Things just keep on going.  You have momentum when you find yourself consistently spending time and effort on something.  Procrastination is over.  You are motivated and fully engaged in it.  No one has to coax you into spending time on it.  You want to do it.  You even think about it when you aren't doing it!

It's estimated that only 10%-20% of people who study real estate investing (whether it be taking real estate or self help courses, reading books or listening to CDs) ever actually invest!  In other words, 80%-90% of these people will gain lots of knowledge about real estate investing, yet they never invest!  The reason is definitely not because these people are not smart enough.  The reason is because these people never achieved momentum with their investing plans.

Let's look at some examples.  Consider a new job.  If you've worked only a few weeks or a few months at a job, you may not know if it's right for you.  You'll have doubts and uncertainties about yourself, your boss, your co-worker and your future in general.  You'll probably lack motivation.  You may be looking around at other job opportunities.  But if you stay at that job for long enough, your attitude will change.  You'll learn how things work there.  You'll know where you're going with the job and the company.  You'll have worked on various projects and where you can go in the company.  You may have even brought in new clients.  You will eventually establish your own unique presence and role in that company.  You'll have become part of a business ecosystem in which you play a significant role.  Your decisions and actions will have a definite impact on others in the company, and you'll take pride in that and naturally want to continue growing there.  Your job has become important to you because of your own accomplishments in it, so you're motivated to continue with it.  That's when you've achieved momentum.

Here's another example.  Think of a snowball rolling down a steep mountain.  At first, it's tiny and doesn't have much speed.  It might get stuck in the snow and stop.  The wind might dash it to pieces.  But if it keeps rolling, as the snowball accumulates size and speed, it is carried along by its own weight.  It becomes bigger and bigger and moves faster and faster until it's actually bouncing down the hill instead of rolling.  That's momentum.

There are two critical things you need for gaining momentum in your real estate investing career or in any walk of life:  1) A plan and 2) a plan that is infused with your personal interests and passion.  If either of these elements are missing, you are not likely to be successful in a given endeavor.  You may come up with a plan, but it might never be put into action.  At the very least, that plan will be much less successful than if you had these two critical elements.

So how do you get momentum with real estate investing?

You need to find an area in real estate investing that excites you.  The best way to achieve momentum with real estate investing (or anything in life) is through passion.  That is, you do what you love to do.  Not what you kind of like, or what seems appealing or fun.  I mean what you love, what you're passionate about.  What will make you leap out of bed in the morning to do, not what will make you maybe hit the snooze bar.  But let's be clear about what that thing is.  What that thing is is not what the newspapers tell you should invest in.  It isn't what your wife or husband or friends think you should be investing in.  It's not what your financial advisor tells you.  It's not what your co-workers tell you.  It's what you and only you want to do.  No compromise.  Why do I say this?  Because you're naturally motivated to do something and to keep doing something if you love doing it!  When you love doing something, momentum automatically happens.

As you build your knowledge about real estate investing, you really need to think about what you would LOVE to do the most in this area.  Be completely honest.  There may be a few areas that appeal to you, but you should pick just one that appeals to you the most.  You will be more successful in one area that you truly love and in two or three areas that you like but do not love.

Now you may find that after a lot of looking around and soul searching that you can't find anything that you truly love in real estate.  If you've looked all through real estate investing and can't find anything that you truly feel a connection with, a love and passion for, you shouldn't invest in real estate at all!  You should find another area to invest in that you truly feel passionate about.  You'll be far more successful doing that than anything else in real estate investing.

Article source: Expert Articles