Article of the Month for January/February/March 2002
Playing Your Own Game
Question, asked by JB:
I just have one question for anybody. Does anybody have an answere on how many people that decide that they are going to become real estate investors are actually successfull. What I am looking for is the ration like 2:1 or is it higher or lower. How many people have become casulties by not doing the due diligence or just plain ole bad luck. Any responses to this post are appreciated. Is this information even kept.
JB, my general feeling is that about the same percentage of newbies succeed in this endeavor as they do in any other endeavor they attempt. I donít think thereís anything easier or harder in this field than others.
The greatest indicator of a beginnerís potential success isnít the money or intellect they have, it amounts to their persistence, determination or commitment or whatever you want to call not giving up on yourself and your dreams when the going gets tough.
It seems to me you have a better chance at success if you have nothing to loseóby going for it 100% without reservation. But if you have a decent job and a lot of responsibilities you almost have to be superman to rev up enough courage to chuck that dependable paycheck and strike out on betting on yourself and never look back.
You almost have to adopt the technique of Hernan Cortes, the conqueror of Mexico, who burned his ships and sunk them in the harbor of Vera Cruz, Mexico to impress on his mutinous crew that there was only one way they were going to make it home and that was to go forward, conquer Mexico and then go home as victors with all their loot.
I myself am a three time attempter. It took me my third try before I finally met with success at the foreclosure game. The first two times I was very busy with my real estate specialty of buying and selling apartment houses for investors and so made only half-hearted attempts to make a go of buying and selling foreclosures.
With that attitude and lackadaisical effort I never got to first base. Foreclosures didnít fail me, I failed to give foreclosure investing the kind of determined effort all new endeavors require.
What was the difference on my third try? At that point, in 1982, with interest rates around 16%, the apartment market was dead. I was living off of my savings and became more and more worried as the months passed that I was going to lose everythingómy house, my business, my savings, everything.
So finally, at that point I was desperate enough to work like a mad man to make it in foreclosures because I convinced myself that I absolutely had toóno ifs, ands, or buts. I plunged ahead in spite of advice from my friends, clients and even family.
Fortunately for me, I wasnít slowed down by looking back. Thereís was nothing to go back to. So I could really focus, with a clear mind on plunging forward without any reservations on my third attempt. I knew in my heart of hearts that I hadnít really tried all I could on my first two attempts, so I vowed not to make that mistake again, nor let anyone talk me into such a mistake either.
At that point my setbacks just spurred me on harder and psyched me up even more. I was a maniac when it came to making it. I could hear the roar of the waterfalls and I was absolutely, positively convinced that I and my family werenít going to be swept over them.
And as fate would have it my first two foreclosures were glorious victories for me. I was astounded buying a half acre lot in Encanto, a so-so area of San Diego for $6,500 and almost immediately reselling it for $19,500. And then just to prove that if wasnít a fluke I did it again with another lot, this time in the very nice area of Bonita. I bought it for $20,000 and incredibly resold it for $42,000 and the whole transaction took only 39 days.
Man oí man, I was absolutely ecstatic and hooked for life on this new lifestyle of living by my wits, with no bosses, no naysayers, finally free to win or lose by my own efforts. I wasnít playing at somebody elseís game anymore, I was playing my own game!!
One of my happiest times then came about when my fantastic wife even bet on me by quitting a job she really liked to help me build a business we truly came to love. And weíve been at it ever since, working side by side for ourselves these last 20 years.