Words of Real Estate Wisdom
Knowledge is power and creates Financial Freedom for those that seek it. In this blog post, I have collected some wise thoughts from a book called “Self Made” by Stefan Aarnio. This is a great read and a terrific real estate reference for you to enjoy!
Where there is no struggle there is no strength
Entrepreneurship is not for the faint of heart …. it takes brains, stomach, and guts to be successful
Freedom vs Security, what drives you? There is an inverse relationship between Freedom and Security. The more you gain of one, the more you lose the other.
Business Schools create employees, not entrepreneurs.
No job can ever pay you what you are worth
Follow your dreams … cancel that … sometimes giving up on something that isn’t working is the best thing that can ever happen to you
Fear is contagious, the more you fear something, the more likely you are to attract that which you fear
The fear of being average can keep you from being extraordinary
Anyone can become rich
Getting rich is a science
Getting rich has little to do with luck
The average is dangerous, extraordinary is where the fortune lies
Following average advice of average people will eventually lead you to average results
In 5 years you will be the same person except for the books you read and the people you meet
The world is changing so fast today that our traditional education is often obsolete the moment we graduate. What are you doing to stay relevant in today’s market economy?
Never give up, for that is just the place and time that the tide will turn
Any new skill brings new words and a new language
Giving unsolicited advice to people who do not want out is one of the cheapest ways to lose friends and alienate people
People with dead dreams will try to kill yours; sometimes it’s best to keep your dreams a secret (even from family)
Analysis Paralysis is a disease where we forego taking action in favour of collecting more information. Collect 70% of the information you need and then take action
Save a portion of your cash each month for further education. School is never finished for the professional
If you think education is expensive, try ignorance
Your birth family will not always support your dreams; find people who are chasing the same dream and form a spiritual family
He who Gives the Most … Wins
Sometimes the people who are closest to you can hurt you the most
If you aren’t successful, try the opposite and you will likely become a success
Going to seminars and reading books is no substitute for taking action
One of the best ways to build your network and meet like-minded people is through seminars
He who gives the most usually gets the most
By giving intangible value like thanks and gratitude, you can stretch $100 of cash into hundreds of dollars of value. The value doesn’t always have to be tangible
Practicing gratitude is one of the fastest ways to stop poverty mentality and transform into a wealthy mentality
Tell your kids … “finish your homework. People in India and China are starving for your jobs”
Frugal people can purchase value or have real value for less
99% of entrepreneurs fail in the first 10 years of business – to survive you need a competitive advantage. If you don’t have a competitive advantage in your business, get out of that business and find a new one
A wise man learns from his mistakes while a genius learns from other people’s mistakes
As an entrepreneur, you never know when your next payday is. You must save your cash and build a large reserve
Know the difference between frugal and cheap. Frugality is driven by value, cheapness is driven by cost
Building credit with credit cards is one of the fastest and easiest ways to build credit
Knowledge is power. Information is liberating. Education is the premise of progress, in every society, in every family
The most reliable way for anyone to become a millionaire is investing and entrepreneurship
Entrepreneurs learn as they go. They tend to be the kind of people who can easily adapt and accomplish a lot, without a whole lot of stress or planning. They approach and opportunity head-on and are focused on making it happen despite any limitations
One of the hallmarks of a successful entrepreneur is angst. Entrepreneurs are often idea factories, igniters, and visionaries. They feel bored or anxious if they’re at a stalemate, or when they’re not doing something
Immigrants are four times more likely to become millionaires than native-born Canadians
The best opportunities come when you aren’t ready for them. Sacrifice something and seize them anyways
Knowledge is your best leverage to escape poverty.
Having 25 customers is more secure than having 1 customer aka a boss and a job. You can lose 1 or 2 customers and still stay in business. If you lose your job as an employee, you lose 100% of your customers.
$1000 a month of clear profit in a small business can be equivalent to the net profit made at a real job after expenses. It’s not about how much money you make but how much money you keep.
Successful people are always learning
Mind feeding or feeding the mind can be done through online education, seminars, or time learning from mentors our coaches
A strong income is not enough to qualify for a mortgage. The bank wants to know where your money comes from and they want to verify it.
If you have no credit, get someone else to provide the credit to buy a property
If you choose a job you love, you will never have to work a day in your life
Never take a job just for the money, always work to learn, not to earn
One of the fastest ways to get ahead is to have two jobs. One to earn a living, and the second to get ahead. Another bonus of having two jobs is that you are too busy to waste your extra cash
Student credit is some of the cheapest and easiest credit you will ever obtain
You can use student loans to buy anything you want, even investments
Credit cards are often used as seed capital by entrepreneurs to start businesses with little or no money
Credit cards are good to start a business, but as soon as you can pay them off and freeze then into the freezer. It’s very easy to get carried away with cheap easy credit
Work like a slave, command like a king, create like God
Good entrepreneurs put their money to work
Great entrepreneurs place their money into slave labour
A smart entrepreneur will have all of his money working all the time, but unfortunately, every entrepreneur has dreams that are bigger than his wallet will allow
Most entrepreneurs are obsessed with making their money work hard and are perpetually out of cash
2 major skills of an entrepreneur operating with no money • investing other people’s money wisely
The #1 way to grow your income is to invest in education
Guaranteed investments at the bank return yield so low that they don’t even beat inflation. If you invest in these, you are losing purchasing power to inflation
The best way to a rob bank is to own one
No matter how much cash you accumulate or save, you will ever have enough
Investments into your education and self-development will always outpace investments made into anything else if you apply your education
USE YOUR MONEY FOR EDUCATION AND OTHER PEOPLE’S MONEY FOR YOUR INVESTMENTS
Learn to use leverage: You make more money on ventures you can’t afford than ventures you can afford.
A money-losing venture and a money-making venture are often very similar, except for a few minor differences. Success and failure are closer than you think
Don’t be afraid to fail, The formula for success us to take your current rate of failure and double it
If you want to be rich …. work for free
Don’t be addicted to money
Don’t work for money. Work for knowledge
The education you can’t afford is the one that makes you rich
Find a mentor with more experience and offer to work for free
Although seminars are powerful, don’t get carried away by becoming a junkie
Opportunity is missed by most people because it is dressed in overalls and looks like work
Opportunity is always hiding in plain sight
Working for free is one of the best ways to learn about a business
Private real estate and business opportunities are hard to find, but typically offer better returns than publicly offered investments
Nothing in this world can take the place of persistence
A half-educated mind is a dangerous mind
Hire for aptitude; fire for attitude
Labour does not entitle a worker to equity in a company; equity is the value brought minus the labour
Always have a second income… just in case 5
Real business is about solving problems, not appearances or ego
Busy does not equal productive
Persistence wins, you only fail when you quit
Success consists of going from failure to failure without loss of enthusiasm
The ability to sell is the most important skill of an entrepreneur
Persistence wins; you fail only when you quit
Sales are contingent upon the attitude of the salesman not the attitude of the prospect
If you want to learn to sell, try selling something that no one wants to buy
The harder the item is to sell, the higher your skills as a salesman need to be. The harder the item is to sell, the higher your income will be
People buy your image before they buy you
Your image either makes you money or costs you money
You need a mentor for every part of your life
Body language and tone are more important for effective communication than words spoken
Taking a risk, being open, and listening to feedback can be at the best investment you can ever make
Facts tell; series sell
If you don’t know what you’re doing, or don’t have the right tools, just improvise
Have faith; faith is the opposite of fear. Take action every day and make things happen
Money wants you more than you want the money
Money is only a tool. It will take you wherever you wish, but it will not replace you as the driver
Consider a mentor who has the opposite style to you. Opposite styles will force you to think differently and grow faster
Sales are both as art and a science
Actions equal dollars; dollars don’t equal actions
When selling on the phone, always use a script. Scripts will save your energy and give you more control over the outcome of the call
Your best opportunities will always come from the people you know in your network
You gain strength and courage by investing in groups, but groups are typically poor at making decisions, there must be a clear and established leader to be successful
When you establish a cutoff price to buy a property, walk away if the seller doesn’t meet your price
Screening tenants and using a legitimate professional property management service is essential to a successful investment real estate
Buying property sight unseen is for professionals only
When stupidity gets you into a situation, responsibility will bail you out every time
You need less to retire than you think; most people retire on $2,000 perversion per month
A few well-purchased investment properties can handle many of your living expenses and free up your time
You make huge gains in a property when you buy on the edge of the “good” and “ bad” neighbourhoods
Areas that are scary today, but will be cool in 5 years, make great investments
Your ventures can be packaged into an investment for investors to invest in. make a binder and business plan to sell the dream
Most investors are earning low returns at the bank like 2-3%. If you can offer them anything higher than that, they will likely invest with you
The value becomes real only when 2 people become interested
You can get anything you want in life if you help enough people get what they want
Teamwork makes the dream work, but a vision becomes a nightmare when the leader has a big dream and no team
Taking full responsibility for a mess will almost cure a situation caused by irresponsibility
Having too many options in today’s world is a curse that too many people have. Having no options is a luxury because it forces a mind to focus
The mark of a true leader is the ability to roll up his sleeves and step into the trenches when his team is failing
Never give your contractors too much cash; always track and verify that they were spending your money on your project
The lack of money is the root of all evil
Public speaking is one of the fastest ways to increase your influence and your income
Strange people often have strange houses to sell
If the house stinks, don’t be alarmed. Stinky is the smell of money
Vendors who are retiring and own their buildings free and clear love to sell their buildings and hold vendor take-back mortgages. They are more common than you think, ask and you shall receive
Always pay those who refer to your deals. You never know when they will bring you the next great deal
Never give a contractor more work than he can handle, he won’t get it done
Cosmetic renovations, namely kitchens, bathrooms, flooring, and paint are the most profitable renovations for any property
Don’t quit your job to be an entrepreneur until you are proficient at selling
When buying houses on the MLS in your market, obey the 100:10:3:1 rule. Look at 100, write offers on 10, 3 are accepted,1 is acceptable
Any small property than is less than 4 units will not truly cash flow if there is more than a 50% debt to equity ratio
Being able to do one or two real estate deals successfully and building a business of doing deals are two different things; the first requires real estate knowledge; the second requires knowledge of entrepreneurship
Some of the best deals come from “ WE buy HOUSES “ signed and online ads
When dealing with private sellers, force them to make a deal on the spot
Hard Money Lenders are private people who lend to real estate investors are high-interest rates. You can expect to pay 9-18% in interest and 2-5% in upfront fees, but the access to the money is usually worth the cost
There are three ways to get ahead in life 1) the blood sweat and tears method aka trial and error ( the slow and expensive way) 2) Work for free (the slow and cheap way) 3) Find someone who has achieved what you want and pay them for an accelerated education (the fastest and cheap way in the long run)
To achieve your dreams, you may have to travel to other cities to meet the experts. Key people you need to move ahead on your journey will inevitably live in other cities, countries, or continents
There are two worlds in business, the sanctuary, and the jungle. Entrepreneurs live in the jungle where it is the most difficult to survive and also has the highest rewards
Buy Hold and Pray is Bad Business
If you put your investors into long term buy and hold deals you won’t be able to reuse their money and you will find it hard to grow fast
Money is all about speed; find ways to gratify your investors fast and encourage them to reinvest often. This will help you grow exponentially
Flipping properties is one of the fastest ways to generate cash in real estate
Building wealth in real estate is a two-step process: 1) Earn Income 2) Invest that income into cash-producing assets
Managing money like a hedge fund is one of the best ways to make big money in real estate through profit sharing and fees
Singles win the World Series
There are two types of deals: sexy deals and profitable deals
Sexy deals don’t usually make money
Many small deals can add up to a big deal
Many small deals have more control than 1 large deal
Stop calling yourself a real estate investor and start calling yourself a real estate entrepreneur
Capitalists are people who raise capital and do business with it
No one makes money without providing value or doing good
The skills of the real estate entrepreneur 1) Marketing 2) Negotiating 3) Production 4) Cash Flowing Assets 5) Capital Raising
If you learn these entrepreneurial skills in the right order, then building your business will be much easier than someone who tries to build it out of order
Marketing is a context for people’s attention
The lifeblood of any business is leads
Leads come through 1) Local Marketing and 2) Internet Marketing
There is sometimes more money in the services related to real estate than there is in the deals themselves
You must become a master negotiator
Income rarely exceeds personal development
Most real estate deals have no inherent profit in them. most profits in real estate come from negotiating your profit onto the table
Deals come from three activities 1) Networking 2) Marketing and 3) Negotiating
Negotiating is a skill that no one is born with. We all have to learn to negotiate
Paying a wholesaler $5,000 per deal is worth it if you are going to make $15,000
It takes money to make money; paying for an opportunity is sometimes the best way to go
Flipping properties is natural if you have built your skills as a marketer and a negotiator
Stop selling leads and contracts and start finding them yourself
Flipping properties is the big money strategy in real estate
Flipping properties uses leverage, which is other people’s money. Leverage is a technique of controlling more resources with less
Don’t be reckless with other people’s money
Big Skills equal big money; fast skills equal fast money
Rich people use leverage to achieve more results with less effort
The higher the leverage, the more money you can borrow, the higher the profits can be
Warren Buffets 1st rule of investing is “Don’t lose money”, Buffets second rule of investing is “Always obey Rule #1“
A smart entrepreneur that can see trends as they happen or before they happen can make a lot of money in transitional zones and neighbourhoods that others wouldn’t see potential in
You should be able to make $100,000 per deal (door) over time if you buy right and manage your properties as a cash flow investor
Buying the right property in the right neighbourhood with the right management and the right finance is one of the best ways to get rich
NO one ever gets rich off cash flow; you get rich off equity through appreciation and mortgage pay down
Passive money in business comes from owning cash flowing assets … buy and hold
Invest in transitional zones, areas that are scary today but will be desirable in 5 years … where great appreciation exist
Follow big government investment as well as private-public partnerships. make the government your partner
If you want to become the King of the Jungle you need to become a capitalist
Capitalists can fund any deal at any time and they do it all cash
The King of the Jungle is the Capitalist investor with millions of dollars of liquid capital to invest
Warren Buffet and Donald Trump, two of the world’s largest investors, raise money to do their deals; why don’t you?
More valuable than 1000 days of study is 1 day with a great teacher
People invest with you for two reasons 1) They believe in you and 2) They believe in your business model
First, you make them like you and believe in you and position yourself as the expert. Second, you have to be able to explain your entire business on a cocktail napkin so that a 3-year-old can understand it
You need to explain yourself in pennies
The Business Plan:
1. Buy all properties at 40 to 60 cents on the dollar
2. Renovate up to 70 cents
3. Sell at 100 cents
4. It will cost you 10 cents to sell
5. You net 20 cents -
6. You split the 20 cents with your investor
7. You each get 10 cents
Ratios are the same for $50K properties or $1 mill properties
Raising capital is the number 1 skill of the entrepreneur
The Winning Business Model:
- Raise $5,000,000, earn 20% return on investment every year.
– Earn this return hitting singles ( flipping small houses)
– 20% return ids $1,000,000 in profit; the split is with your investors.
– Your investors make a 10% return on their money
- You take the other 10% or $500,000 in profit every year
After two years, you will be a cash millionaire
You need $3-5 million in cash to dominate your local market
A simple strategy repeated 100 times will yield huge results
Many millionaire investors are actively looking to provide funding for hungry ambitious entrepreneurs, the investor provides all the cash, the entrepreneurs provide all the work and the profits are shared
Sell your investors the business model, not the individual deals or they will be confused
RAISING CAPITAL IS THE #1 SKILL OF THE REAL ESTATE ENTREPRENEUR
All the best in your real estate journey!
Kind Regards,
John C. Heeney, CEO Glenroe Lending
Glenroe Farms Limited ( Private Lending )
We build LEGACY to create TRANQUILITY
john@glenroelending.ca
519 808 7370
