I was reading an article in Realtor® the other day. Yes, I am a Realtor to the extent I pay my dues every year. I’m not a practicing Realtor as I don’t represent clients, only myself and for my investments. This article was a promotion of one of the speakers for their annual conference, Jack Canfield. You know him as the co-author of Chicken Soup for the Soul. Three of the four items in his article you hear me talk about all the time – purpose, goals and daily activities required to reach your goals. It was the fourth item that caught my attention – own it.
I’ve spoken and written several times about ownership, what it means and how practicing ownership principles can have a dramatic impact on your life and the results you achieve. It was Mr. Canfield’s formula that grabbed me: E + R = O.
The formula spelled out is Event + Response = Outcome. Let’s apply that to real estate investing in Arizona. The event is relatively easy to define. Our real estate market crashed. Prices dropped far and fast. Money dried up. It is the “R” response and “O” outcome that is harder to quantify as it is different for each one of you. But, it is your personal response to the event that has been determining your individual outcome. Let’s look at possible scenarios.
There are many real estate investors that took the first approach – did nothing. Oh, they had all their disaster stories to talk about and boy did they talk about them. Some even had knowledge and experience and believe we were in a truly exceptional real estate investing market. Yet they did nothing. There are plenty of reasons and they used them all – no money, no time, missed the bottom, hate to deal with renters, the fix & flip profits dropped, can’t get away form my job, the spouse said no, etc.
Next is the real estate investor that – did some. This is the investor that is fully engaged. They follow the market, attend meetings and network. They commit themselves to taking education. They wow their non-real estate friends with their knowledge and insight about what is happening in the market. They actually may have even invested in a property or two. They love to tell the story about how cheap they got, how easy it was to rehab and how much rent they are getting. They talk a great game and dream and even better one. I hate to tell you this, but most AZREIA members fall into this category. Just sayin’.
Next is the real estate investor that went – all in! They did everything the “did some” investor did, but they didn’t stop there. They realized the same opportunity the “did some” investor did, but they didn’t let anything stop them for going “all in”. What do I mean?
They went back and really made sure they had properly defined their purpose. They reviewed their precise goals and objectives to ensure they knew what it was going to take to reach their purpose. Then they told themselves they believed this was a once in a lifetime opportunity in this real estate market. Then they changed their behavior to be certain they could take full advantage of the opportunity. What did they do?
Every one is a little different, but there are some commonalities. They got smarter through education. They got better through committing themselves to understanding their part of the market. They network at a very high level. They found new partners. They tried new things. They sped up their decision processes. They found the money to participate in a greater way. Don’t ask me how, they just did. They wouldn’t let anything stop them. They were relentless. They acted with urgency. They were and are committed to their success.
There are also some commonalities in things they didn’t do. They didn’t whine when things went wrong. They didn’t turn negative is they missed the opportunity to get a certain house. They didn’t put all their eggs in one basket. They didn’t listen to the “did nothing” or “did some” investors.
I am going to let you write part of this article by asking you to think about something. We haven’t discussed the “O” or outcome. What do you thing the outcome is for each of the investors mentioned above? Think about it for a few minutes. Think about what category you are in. Think about what category you want to be in.
Now, for the good news. This market isn’t over. The opportunities are plentiful for the educated, informed investor that fully understands their purpose and objectives and is willing to do what is necessary to succeed. It is only the “R” that matters. Your “R” will determine your “O”. Now which category are you going to be in by the end of 2012?