Real estate investing is a business that produces more riches than any other industry, yet individuals remain skeptical about starting in it. That is because being a real estate investor comes with a lot of challenges and hardships. It is a profitable, yet hard pill to swallow.
You put a tremendous amount of work and money into cracking your first deal; you do everything to buy a property at an affordable price, but what gives? When you find out the same property can be purchased at a lower price, and you overpaid for it? You invested in the wrong place at the wrong time. You will encounter failure in your life which comes with hopelessness, melancholy, desperation, and misery. But is that the end of the road? No, Trust me; every investor goes through this situation once or even twice in their career. According to research, 80% of new investors face loss or decides to quit within the first year.
So, whatever you do, don’t even think about giving up. Success is waiting for those that are eager to drive forward through difficult occasions. When I was a player in the NFL, I was cut from a team and I felt terrible about it. But I knew if I kept working hard, I would get another opportunity. There’s a saying that says “the harder I work, the luckier I get”.
Investing in the wrong place?
It doesn’t matter if you have invested in rental properties previously, or have achieved massive success. You will encounter loss which will ultimately lead to failure. And, once you have experienced this failure, you will ask one question from yourself “How did I invest in the wrong place”? But, such thoughts will mount you to isolation and anxiety. You will feel like you’re all alone, nobody will comfort or help you in dusting off these thoughts. But what you should know is you are not the only individual facing this failure. Every Investor or business visionary runs over this sort of disappointment in their investment career. But in reality, nobody shares their struggle, which results in you thinking that you are the only one experiencing failure in life.
So, the answer to that question is. No, you are not the only one. Everyone has invested in the wrong place and faces defeat in their life. What matters the most is what you learn from your failure, and how you can rise from the dust.
If you learn from failure, you haven’t really lost:
When you are successful, cracking deal after a deal is nothing enormous for you; success turns into your propensity. Nothing can encapsulate that epitome of happiness that lies in you, but then suddenly you encounter another failure. The failure comes with disappointment, distressing, and the thoughts that you will never be successful again. But is that the right way to overcome loss? No, we should always look for the beam of light in the darkness. So, instead of burying those feelings inside yourself, you should figure out a way to overcome this failure. Someone once said “Failure is not a crime, but failure to learn from failure is”
The following summary highlights the ways you can learn from failure:
Always pay less than the market value:
Overpaying for a property that can be bought at a lower price always feel like the end of the world. It results in the growing fear inside us and demoralization. But we should always look at the brighter side of the coin. We know, the sentiments allied to loss are a hard pill to swallow. All your dreams now feel like a defeat to you. And even though these things are normal to feel, we should always know “It isn’t the end of the road” despite it hurting like a knife in your heart, it is the key to success. Committing such mistakes will help you build up more substantial backup for the next time, and will assist you in building a mindset that will always focus on the profit. This way, you will always look out for the market value first before buying.
The ultimate edge of learning from your failure is the ability to ask yourself a question: Where did I drop the ball? What might have made me succeed? Well, if you can highlight your own mistakes, nothing can be better than that. However, if you are new to the investment process, the best thing to do is to join a real estate meetup. You can learn from other investor’s mistakes so you don’t make them. Communicating with them will not only enhance your capability of investment, but will also help you in the construction of creative ideas. Moreover, these groups are great places to meet potential partners for future deals.
Usually, we hesitate in asking other people where we went wrong. Well, don’t. It would be best if you always stood at the forefront to ask these questions. For instance, you can inquire about your mistakes by asking “for the purpose of improving, can you please let me know the loopholes you found in my work” Such feedback and constructive criticism can assist you in overcoming your mistakes. This is hard to do because no one wants to be told they were wrong. One thing I learned when playing in the NFL is there is always something you can be working on. The only way to get better is to be coachable.
Embrace Change in your investment style:
Enhancing and adopting a change in your investment style can be a little challenging. But, instead of feeling low about it, it would be best if you embraced the transformation. This modification will aid you towards the journey of success. Change is hard, but if we aren’t willing to change, we will ultimately be left behind.
Not Every investment is The Jackpot:
We should always welcome new investment ideas, but at the same time, we should also focus on underwriting deals conservatively to avoid being aggressive to win deals in this competitive market. Always have two or three people look at your underwriting to make sure you aren’t being too aggressive because the deal looks like a home run.
Failure is part of an investor’s life. The loss and profit will come and go, but you don’t have to lose faith in yourself. As someone said “There cannot be a success without failure” So, always prepare to embrace your mistakes and try to learn from them. If you have allowed the mistakes to teach you, they will shape you into not only a better real estate investor, but a better person overall.