The Way Successful Real Estate Investors Think

You open the heavy mahogany doors to the restaurant and are greeted by a smiling host. You let him know that you’re here to meet someone. He responds with a polite, “Follow me this way.” You’re feeling a little nervous and doing your best to hide it. This is a big meeting. You’ve gotten this opportunity to meet with a highly successful real estate investor to pick her brain. 

As you reach the table, she stands up to greet you. The first thing you notice is her warm smile; she has this kind confidence about her that immediately puts you at ease. 

You’ve met people like her before – wealthy, highly successful people. They have an air about them. All of them. What is it about highly successful people that make them that way? In one word, its mindset, it’s the way they think, the way they see and interact with the world. In this article, we will give you a glimpse into that mindset. We’re going to share with you the way successful real estate investors think.

Real Estate Investors Think Why

Successful real estate investors, all of them, know their why. Why they get up every day and pursue their life’s mission - their life’s passion. They don’t have to remind themselves of their why. They know it in their very core.

Your why is the foundation on which your entire business is built. It’s your life’s purpose. Maybe you do it for your children and the legacy of your family? Perhaps you do it to prove to yourself you are good enough? Or perhaps you do it because you want to create wealth and use it to make a better world?

If you don’t know your why yet, that’s ok. You have a why, you just have consciously become aware of it. So, close your eyes, breath, clear your mind, and ask yourself what it is that gets you excited about real estate investing? Then ask yourself why and listen to your answer. 

Real Estate Investors Think Vision

Once real estate investors learn their why, they need to envision the what and the how. For successful real estate investors, the what is always big…really big!    

As yourself, what will your real estate investment empire look like in 10 years? How many doors will you own? What will your lifestyle look like? How will you feel? How will you be helping others with your success?

Once you have a clear picture of the what, you need to develop the how. My best advice to you on developing the how is to not overthink it at first. My most significant moments of clarity on how to build my business have always come when I’m most relaxed. When I’m sitting at the beach, walking the dog, or going for a run. Let your imagination run free, and don’t limit yourself with any kind of doubt. Using the biggest brush strokes; How will you get to your ten-year goal? When the inspiration hits you, get a pen and paper and start writing it down. This is your vision – the details come later. 

Real Estate Investors Think Strategic

Strategy is where vision, knowledge, patience, efficiency, and relationships intersect. Very successful real estate investors know this fact. 

If you want to build a great real estate investing business to fulfill your why you need a plan. You need to ask yourself: How will I get my first property? My fifth property? What will I do with my profits? How much liquid assets do I want to keep in reserve for unforeseen eventualities that occur to every business? What areas am I weak in that I need to bring a strategic partner to sure up? How will I develop financial and human leverage in my business? What level of risk am I comfortable with? What are the parameters I will set for the type of real estate I invest in? Am I looking for long-term recurring revenue, or do I plan to make my money when I sell for a profit?

Take the time to answer every single one of these questions on paper. Then answer all the questions that arise as you work through these questions. When you’re done, arrange the information to create an orderly blueprint to work with and guide your decision-making.  

Real Estate Investors Think Net Worth

Successful real estate investors know that no matter what their why is, that the ultimate goal is to build wealth. It’s a mindset, and it’s critically important. 

A mistake that so many business people make is to mentally account for their annual revenue or total assets as if it is the measuring stick of their success. It’s not. You need Net Worth to be your first thought when you mentally tabulate your financial success. It will guide you to making the best decisions. 

As a real estate investor, your net worth is the total of all the real estate assets you own minus how much you owe on them. That is the true picture of how much wealth you hold. 

Likewise, you must look at your net profit on an annual basis. What were my total rents, minus my total expenses? This will help you see if you should raise rents, lower expenses, or maybe sell off a building that isn’t netting as much as others in your portfolio.   

Real Estate Investors Think Relationships

Have you ever heard the old saying, “It’s not what you know, it’s who you know”? Every successful person on the planet knows the fundamental truth of this at the very core of their being. Life is about people, and business is about people. 

As a real estate investor, you have to have amazing relationships with business partners, lenders, builders, maintenance people, cleaners, etc. The number of connections, and the quality of those relationships, may be the most critical factor in your success. 

The key to each relationship is to have the mindset of putting the other person’s needs first. If that is not possible in a particular situation, then at least allow yourself to truly see the other person’s point of view and find a compromise. People who know that you’re looking after their best interests will always go the extra mile to help you every chance they get. So, start building those relationships and find a way to enjoy the processes. 

Real Estate Investors Think Opportunity and Value

 A good real estate investor knows their why, has a vision, builds relationships, has a plan, and executes that plan. A great real estate investor is always looking for opportunity and value and often sees it where others don’t. 

Is that old house on the main strip being utilized at its highest and best use? Could it be possible to rezone that land and build an apartment building? If we improve the building, can we begin a strategy to raise rents? 

Get creative with your thinking. Look for value, look for unrealized potential. If you begin to see an opportunity, the next step is to run it through a realistic business plan and risk assessment. 

Real Estate Investors Think Action

This might be the biggest one of all – successful real estate investors think action and take action. Big action! Fear is an emotion that every human being must experience throughout their lives. There is no escaping it. The difference between ordinary people and very successful people is that successful people don’t let it mould the course of their life.

Thinking big comes with big fear. Every entrepreneur finds a way to balance two key forces: the enthusiastic passion they have for their life’s work; and the fear that comes from doing what few others dare to do. It’s not that successful people completely ignore the fear, it’s that they have found a way to be honest with themselves. To discover the underlying cause of the fear they are currently experiencing and utilize that newly discovered information effectively. 

Sometimes you’re very afraid because your big idea is a bad idea. You must be willing to see the truth behind the fear and act on it. Sometimes the fear is only because you’re doing something that has never been tried before, and in that case, you take action too. 

Successful real estate investors have gotten to where they are because they knew their why, cultivated a clear vision, developed a strategic mindset and plan, used net worth to measure their financial success, understood the power of relationships, always looked for value, and then took massive action!