I’ve had quite a few clients and associates ask “How did you get started flipping? Did you like take a course or learn from someone with experience?”
The short version of my answer is.. I bought a flip deal!
I work with many newer investors, and I love doing it. I’m writing this post because I think that the #1 thing that holds my clients back is “Analysis Paralysis” or needing to know too many variables before hopping in.
Key #1- Multiple Exit Strategies
When I bought my first flip deal, I didn’t even know the general process of a flip, much less have the contractors, resources, or systems to feel confident about my results on the tail end.
But, I did have a plan A, B, C, and even D for the project, and I knew in my gut that it was a solid deal.
If I was not able to sell and make the profit that I wanted to (Plan A), I could have B.) kept the property, refinanced, and had a break-even or slightly cash-flowing rental with most of my cash back, in a great market poised to appreciate. C.) Moved into the property and sold my primary for a nice gain. Or D.) Sold for less profit or a slight loss and learned a ton.
Now luckily, I was instead rewarded for TAKING ACTION before knowing all variables, and I came away with a profit north of $80,000.00 in about 5 months time.
Key #2- Learn by Doing
It was literally only a few weeks prior to going under contract on that first flip deal that I spoke with some local investors who tried to pitch me their flipping course that had such great reviews. When I was baffled by the $15,000.00 price tag on the course, they tried convincing me by telling me about the horror stories of beginner investors that have “lost their shirt”.
Boy am I glad that I didn’t buy into this. 6 months later, I would have been $100,000.00 poorer and following these guys around like a puppy dog. I wouldn’t have developed my own network of contractors and my own systems. I wouldn’t have learned the many lessons from both successes and failures within the project.
When you hear beginners talk about real estate, you hear them talk about entire projects as successes or failures. But when you hear experienced investors chat about real estate, you hear them dive into the details, it’s less about a specific deal and more about a cog in their machine, their system that they have developed within their lane. This brings me to Key #3…
Key #3- Find a Lane, and Stay In It!
When you are able to find a lane that makes sense for you and you commit to it, there are only so many lessons to learn until you become very proficient.
What do I mean by a “lane”?
The more specific you can get, the better! My past 4 investments in my area have all come from single family homes that need work, in a: specific side of town, type of neighborhood, purchase price range, ARV range, and rehab scope. When something in this range comes across my plate, I know if it’s a good deal or not almost immediately. This allows me to be very efficient with my time and money.
It is very easy to get shiny object syndrome in real estate. There are hundreds of different avenues that you could take, all with attractive attributes. It takes discipline, but it is SO important to ignore most of these different avenues if you ever want to become really good at one.
So figure out which lane fits with your personality and financial position, and DIVE DEEP! The more specific you get, the more likely that you will be a top player in that lane.
Wrapping it up…
Real estate investing has a massive advantage over many other investment vehicles due to the amount of CONTROL that you have over your investment. The only way to develop that control is through ACTION! I just provided you some nice pointers that should help you take action in your specific market, and snowball your way to success and wealth. Now put your blinders on, keep your head down, and get to it!
Best of luck!