Look, it’s 100% possible to make some real wealth, even get rich in real estate investing. Whatever your definition of “get rich” may be, you can accomplish it with real estate.
There’s opportunity to earn both monthly passive income and large chunks of cash during the life cycle of owning a property.
But, you need to know what you’re doing.
And we constantly see beginners make mistakes because they don’t follow the basics of getting some education, then finding a mentor and then following a system.
To cover all the mistakes we see would take weeks and we’ll keep adding articles to address various examples of things to watch out for.
For this article we’ll focus on one of the most important aspects of real estate investing … advertising and filling your property with a tenant.
After all, having someone pay you money every month is kind of the idea. That’s one of the important ingredients if you are going to make it in real estate investing.
Here’s something that we’ve noticed over the last couple of years…
Anyone can take a project to 90% completion. It’s a real pro that finishes the job. And it’s that same pro who gets to reap the rewards of a finished project.
Getting a tenant into a rental property is obviously worth a good sum of money to a real estate investor.
There are four important differences between an amateur real estate investor and a real professional.
And these four can mean the difference between selling a property at a loss to rid yourself of it and making very healthy returns.
Amazingly you don’t have to be a marketing genius to fill a property with a good tenant but you do need to do these things:
- Constant Presence.
Let’s say you advertise your property for a week in the local paper. Towards the very end of the week you line up a tenant for your property and set a date two days later to sign the lease and pick up some cash as a deposit to hold the property.You are excited and to save a couple of hundred dollars you stop advertising in the classifieds for the next week.The meeting day rolls around and of course – it happens.One of you has a kid that is sick, or a dog that needs surgery, or a car that isn’t behaving and you need to reschedule.
Then for no reason whatsoever when you try to meet up on the agreed upon rescheduled day the possible tenant vanishes. Calls aren’t returned, their voice mail box is full and their girlfriend, who you called because you were smart enough to get a back up contact number, has no idea who you are.
Frustration settles in.
You have no more tenant leads because you stopped your advertising. To save a few hundred bucks you pulled your advertising and all the momentum you were building is lost.
The other possible tenants have vanished and you need to start all over again.
You then resort to questioning human nature. A popular question asked at this time by beginners is “Why do these tenants lie? They said they wanted the house, why don’t people do what they say they’ll do? What’s wrong with people these days?”
Nothing is wrong with people. People have behaved this way for hundreds of years and will continue to do so.
The problem is you, not them.
It’s your lack of sales experience and knowledge that is the problem (a huge topic for another time).
You focus on the negative and it’s a downward spiral from there.
We’ve seen this happen to amateurs over and over.
And it ends up being so scary at this point some people just break down and decide they can’t make it in real estate investing and leave the game all together. Bad idea, but to each their own.
Now the professional does the opposite.
The professional investor keeps advertising until the lease is signed and there is cash in their pocket. And not just on free websites like www.Kijiji.ca or www.CraigsList.org. They’ll actually spend the money to keep a well written classified ad in the papers and on that paper’s website.
A signed lease can represent tens of thousands in revenue.
You can’t make any money in real estate investing without getting things like leases actually signed.
Why would anyone jeopardize that to save a few hundred bucks on advertising?
Small thinking produces small results and by cutting off advertising before you have a signed lease agreement you are thinking small.
The professional investor learns about human nature and realizes that people may not follow-up on commitments.
But the pros don’t not focus on that. Instead they focus on having 3 or more possible backup tenants in the wings.
They continue to show the property to other possible tenants until the lease is signed. They attempt to sign the lease on the very same day that someone shows interest.