Investing In Real Estate Is A Numbers Game
By Paul Esajian on February 10, 2014
One of the biggest shocks that new investors often encounter is the realization of just how difficult this business can be. From the outside, it would appear that all you have to do is find a property you like, make an offer and start rehabbing. However, you may make look at 25 properties, make offers on 10 of them and get one accepted. On that one offer, you will have to counter back and forth at least a few times before settling on a final number. Regardless if you are old or new to the business, you need to accept and embrace the fact that real estate is a numbers game.
Numbers are relevant to every aspect of your business. It starts with your marketing and networking. Simply showing up at a networking event a few times or a local investing group will not have the impact you are looking for. You need to make the commitment to be active for months down the road. The more you put yourself out there, the more people in the business will recognize and ultimately trust you.
The same can be said for your marketing. A one-time letter or one-time ad in a newspaper will have very minimal impact. You need to be committed to doing the same letter and the same list over and over again. It may not appear this way from what you see on TV or read online, but there is a grind to the real estate business. A lot of grunt work goes into every deal and action you take. It can be very frustrating knowing that you can spend months looking for the ideal property only to find out you were beat to it.
Everything you do for your business has to have a purpose. If you just show up to events or call a lead one time, it will not do you any good. Every lead you get has to be “scrubbed” until you get a definite answer. For some investors, getting leads is not the problem, but converting them is. Even the best investors lose deals or hit a patch where the deals they get are not a good fit. Before dismissing these leads as bad or a waste of time, try reaching out to them at different times or by different means. The higher number of times you call a lead, the greater chance you have of converting it into a deal.
In a broader sense, the more people you work with the better chance you have of getting an opportunity for a deal. Every dollar you spend, every phone call you make and everyone you reach out to will add up and has an impact. There are numbers everywhere in the business. Some are real and tangible, but all will have a cumulative impact. The minute you start to think that numbers don’t matter is when you will see your business start to suffer.
Give yourself the best chance for success by using these numbers to your advantage. Everything matters and the more you do, the more you will benefit.