Real Estate Investing: Focus On Long Term Objectives
By JD Esajian on January 20, 2014
The real estate business is one in which extreme highs are almost always complimented by devastating lows. The best businesses are those that can function somewhere in the middle of these extremes. There are many times when you will find yourself on one path only to shift lanes at the drop of a hat. Whether or not you regain your original path is entirely up to you.
Your most recent deal could have generated impressive returns or it may have gone entirely wrong. Regardless of the end result, it is important to move on with the focus being long term. Don’t let current success make you complacent or failures make you fear the future. Move on according to your plan. As long as you preform your due diligence, you should be prepared for what is to come.
It is almost too easy to find yourself straying from time to time. Maintaining a constant trajectory while investing is hard, as every choice has repercussions. Most people who cheat on their diets have a tough time going back. The same can be said for workout plans, sleep schedules or sticking with a business routine. You may have been working on a marketing plan for months and dropped everything to focus on a new deal. This new deal is important and can bring you some needed capital, but unless you get back to what you were doing, you will find this success short lived.
It is important to reflect on every deal you do. How did you get it? How can you replicate successful transactions? The answers to these questions will assist you in the future. A short sale from a family member may be a great deal, but you probably won’t have many similar deals from that source again. These deals could take you months and cause you to lose focus on the big picture and sustained success. If you have a project that you have been working on, you need to make sure you stick with it regardless of what else you have going on.
The age old question in real estate, and business in general, is if it is better to focus on volume or to maximize every available opportunity. Some investors will only close one or two deals a year but make as much or more than the investor who closes a dozen deals. This is a personal preference, but the answer lies in how long you want to be in business for and whether or not you can handle the ups and downs. If you put all of your time, money, attention and resources on closing one monster deal and it falls through, where does that leave your business? Even if it ends up closing, have you passed on other opportunities that would have brought you small gains? Getting that check is nice, but what deals do you have moving forward?
Closing a big deal is nice, but that feeling does wear off a few days after. It is more important to focus on what you have left on the table. For some, this is a springboard to the path they want to be on. Others may see it as a tremendous setback. Closing a deal is never a bad thing, but always keep an eye on the long term and how you want your business to be six months and a year down the road. If the deal sets you off track and causes you to take a step backwards, it may not be worth it.