As a real estate entrepreneur I talk to a lot of people every week.
Some are other investors; several are potential investors who want to participate with me in my transactions; some are very new to investing. I can tell they’re new because they are heavily focused on “the deal.”
They will say, “Where are the deals? I can’t find a deal. I need a deal!”
What they don’t understand is that the deal is the last thing they should be concerned about, because there are so many deals out there that you literally can’t keep up.
It doesn’t matter where you’re looking to invest, the deals are there… the properties are there. If you don’t believe me, do a simple search on Craigslist in your area. Tell me what pops up in seconds.
Let’s say you do this Craigslist exercise and you find a couple of properties you like… that you want to invest in. But, whoops, you don’t have the money to invest. (Having a deal doesn’t matter… YET.)
This also tells you why the deal comes last.
Before the deal there are three other important criteria that must be satisfied and in a certain order.
You have to understand your…
This simply means that you have a very good understanding of what you like to invest in so you can convey that message to other people.
This is important.
If you are raising private capital because you don’t have enough money or credit of your own to buy a rental property, you will need to convey your message to people who have the money and credit you need. (Those people are called investors.)
Your identity and the investor’s identity have to be in alignment for the deal to make sense… even if you don’t have a property yet.
Once you understand what types of properties the investor likes it allows you to be focused. Then when you see one that matches the investor’s criteria you will have something to bring to him for his consideration.
Chances are he might just do that deal with you.
BUT if you bring him properties that hold no interest to him because they aren’t in alignment with his Investor Identity, that’s going to be a no-go.
You may wonder what my Investor Identity is.
That’s a great question! Here’s the answer…
I like to invest in multifamily properties in the United States of America, specifically in certain cities and states… in a specific market.
This is actually part of your Investor Identity and also that of your investors’ identities. The markets you like may not be the markets they want to invest in. So, once again, if you don’t have enough money and credit of your own to do deals and you need others to participate by letting you use their money and/or credit, the markets you want to invest in better match those (a.k.a., the Investor Identity) your investors like.
For me, I love investing in North Carolina. I have lots of reasons for this, and I’ll be sharing those with you in an upcoming article. For now it’s enough to tell you that North Carolina is where I invest and that is where I am looking for more properties.
For people I’ve been playing Cashflow games with and meeting with in Barcelona, North Carolina holds some appeal… especially when they learn my reasons for investing there. It becomes a long-distance investing situation for investors in Spain, but that’s not a difficult process and the returns are so good that my deals in North Carolina are worth any extra effort.
For investors in the U.S. it’s about the same.
The process is just that… a process. And my teams handle everything.
Oh, and that’s the next part of the “IMTD” you need to understand.
At first you will do most things yourself as a real estate entrepreneur. Believe me, I know! But in short time you will come to realize that you can’t keep going at that pace. You need help… good help.
For example, since I live and work in Barcelona but invest in the North Carolina market, it would be silly of me to think I could manage the properties or even walk them prior to purchase, right?
So I developed a team that helps find properties for me, walks them, manages them, etc. And I have a legal team both there and in Barcelona to keep deals running smoothly. I’m adding to my team all the time and I’m not just talking about the real estate investing side either.
I’m also developing a marketing team now, which is exciting!
I’m excited because these marketing minds help me reach more individuals who will want to work with me either to learn how to do what I do (yes, I’ve opened the doors to coaching because people keep asking) or they want to participate in my deals.
Now you can see why finding properties or “deals” is the last thing on your to-do list. I don’t care if you have the best property that ever existed, if you don’t have the money or credit for it, well, it simply doesn’t matter.
If you are just randomly choosing properties without any idea of the why behind your decisions, those deals aren’t going to work out well for you anyway. At least the likelihood is slim.
If you don’t know the market(s) in which you want to invest, guess what? You’re going to be hard pressed to find investors who will work with you because their Investor Identity and the markets they want to invest must match your investing goals.
If your “I” and “M” match theirs, it will be easier to get them interested in participating with you. At least that’s how it works for me… and it’s how I’ve been taught to close deals.
After you have satisfied these two criteria, you can find matching properties and close deals. But as you grow you’ll need to develop a team or, like me, maybe more than one.
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