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A question from a reader:
Brian,
Love your blog. I’m devouring the information.
I really want to get into the property market and have a little saved for a down payment.
However, in my state (Australia) I have only been able to find 2 deals that has positive cash flow in the last 6 months. I put an offer in on one of them but didn’t get it. It was subsequently sold at a higher price that made it negative cash flow. The other was bought day 1. The rest are negative where I would have to pay weekly repayments. Not good.
Perhaps Im looking in the wrong places. Perhaps Im not thinking out side the square.
I would love some help!
Cheers,
O.P.
Hi O.P.,
Your dilemma reminds me of what I was looking at 6 months ago. I looked at a ton of houses before I finally found one that cash flowed. I felt really lucky to find that one deal and I thought it would be equally hard to find another one.
But I was totally wrong, because once I got a couple of good mentors, and they showed me a few things, I realized that on any given day in the city there were probably 20 or 30 good deals that would cash flow. They would go fast, and a few days later, 20 more would be there. I’m serious…I couldn’t believe it at first. I still meet guys almost every week who I talk to and they tell me “I tried that and there are no good deals”. They are totally convinced just like I was.
Everyone has an opinion, and they will usually share it with you whether you want them to or not. Ask 10 different people how start your own business, and you will get 10 different opinions.
The same goes for asking advice on how to get in shape, how to find a good deal in real estate, how to make a good sales pitch, how to throw a good party, how to make a good website, how to etc…
So what is good advice and what is bad advice? Who should you listen to?
One of the most important things I ever learned is this: only take advice from people who have already done what you are trying to accomplish.
It’s fine to listen to people you meet, theres no reason to be rude, but don’t put much faith in what they tell you unless they’ve already done it themselves.
I think if you take a hard look at where you’ve been getting most of your beliefs about building wealth for example (parents, teachers, friends, media), they aren’t good sources by this standard.
Let’s say that your goal is to be worth $10 million. Are your parents worth $10 million? Was your economics professor in college worth $10 million? Is your buddy Steve at work worth $10 million? Is the person who wrote that article in Forbes magazine worth $10 million?
Robert Kiyosaki makes this point about who you should listen to in his book Rich Dad, Poor Dad.
It’s amazing how often you run into someone who is just itching to tell you why you’re wrong. Be careful about who you take advice from, or you could very easily end up just as unsuccessful as they are.
Where have you been getting advice in your life?
Today I want to tell you about a real estate deal I’m working on, and how I analyzed it.
First, I set up a saved search on my local MLS website (your city probably has one too). In the search I told it to let me know about all 3 bedroom 2 bath houses that were less than $85,000 and more than 1,888 sq.ft.
Why do that? Because 85,000/1,888 = $45. I was telling it to let me know about every house that was $45 per square foot or less, meaning cheap and usually not in great shape. I wanted to find a foreclosed house that was selling for 60 or 70 cents on the dollar so that I could fix it up.
The saved search notifies you each time a new home fitting that description is listed, and yesterday it sent me list of about five homes.
For each of those five properties, I wanted to answer three questions:
To answer these questions, I used a tool called Quest which generated the screen shots below, but if you don’t want to pay for Quest you can also do this type of analysis yourself by manually searching through your MLS and putting the data into Excel.
1. How much could this home sell for if I fixed it up?
It’s amazing what you can do once you have a following and you are a brand. For example, you can decide to answer some questions one day and earn $50 grand. That’s part of the reason I’m creating this blog: to build myself as a brand. Everyone should focus on building themselves as a brand.
There’s lots of marketing authors, but only one Seth Godin.
There’s lots of real estate Guru’s, but only one Trump.
There’s lots of pretty girls, but only one Paris.
Whatever it is that you do, probably plenty of other people do it as well. So if you want to earn more for an hour of your time, your name has to be worth something.
Do you have a desire to be known in your field?
When did cell phone companies get the idea that making things difficult for their customers was a good idea?
Here are just a few examples of where they went wrong:
This is Day 9 of my 30 day marketing challenge to make a profitable blog website.
1. I installed the WordPress Cache plugin so that the pages on this site will load faster. I noticed it becoming a bit sluggish, and this seemed to have helped a lot.
Today, I’ll let you in on a little secret that I use to read AT LEAST ONE BOOK EVERY WEEK, without taking any additional time out of my day.
But first, I’d like to take a minute to stress how important ongoing education is to your success, and why EVERY SINGLE SUCCESSFUL person I know focuses on it daily.
I don’t mean the kind of education you got in school, in those dusty old text books that were full of numbers and boring graphs.
I mean a different kind of education that deals more with street smarts, than book smarts.
Did you know that the majority of people (58%) will NEVER read a book again after high school? Our education system leaves such a bad taste in people’s mouths. When we are forced to learn, we end up dreading the process, instead of embracing it.
I know that in my own life, it wasn’t until I was out of school that I really started to love learning. I realized one day, that learning wasn’t just for reading, writing, and arithmetic. You could literally learn how to do ANYTHING in life.
Whether you wanted to get in shape, become more creative, build wealth, or start a business…it is a LEARNABLE skill.
If you are subscribed by email and have seen some strange problems lately, I apologize. It is my fault.
In the process of switching to FeedBlitz as our newsletter provider, there have been some difficulties. I think FeedBlitz could improve their interface here and there, but ultimately it’s my fault for not making you the readers aware of the changes. So please bear with me as I get them worked out.
More companies could probably avoid disaster and improve customer relations with that simple phrase: “I apologize, that is my fault”.
I have to respectfully disagree with Jack and Suzy Welch in their recent Business Week article about what’s required to start a company.
His message essentially boils down to this: you need a good idea.
He goes on to talk about the horrors of starting a business, including disappearing time, money, freedom, etc, and says that it’s all for nothing if you don’t have a good idea.
This advice is wrong, and heres why:
Read the rest of this entry »
Have you ever heard the term INTRA-preneur?
It’s a play on the word entrepreneur that basically means “being an entrepreneur inside a big company”. In other words, it’s someone with a regular job who has a boss just like everyeone else - except they have the MINDSET of an entrepreneur.
But what does that mean exactly?
An intra-preneur could be someone who leads a new project within the company, like the launch of a new product. This would have similaries to a launching a new company based around a single product because they’d still have to manage a team, look at a new market, and generally wear may hats.
An intra-preneur could also mean an engineer who thinks about the business in a broader sense. Most engineers are 100% focused on the technical work that consumes their time, but if an engineer was also involved in, say….bringing in new clients for the company, and making sales….he or she would be thinking like an entrepreneur.
Read the rest of this entry »
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