In a takeoff of Steven Covey’s 7 Habits of Highly Effective People, let’s take a look at the Highly Effective Real Estate Investor and the things they do that differentiate them from the rest.
Habit 1: Be Proactive
The effective real estate investor is in charge of their own destiny. No one is going to deliver that smokin’ hot deal to your doorstep if you don’t let them know who you are, what you are doing and what a smokin’ hot deal looks like! Your behavior is a product of your choices, not a result of your conditions or emotions. Instead of reacting to the world around you, take control. Be proactive.
Our basic nature is to act. Here are a few ways you can be proactive right now:
- 1. Take a few minutes and write down your goals. It’s not hard. Just think about 2 or 3 things that would dramatically improve your life if you were to accomplish them.
Some may have to do with real estate investing, like acquiring 4 rental properties that generate a passive income of $1,000 or more a month by the end of 2011, or transitioning your current single family holdings into a multifamily deal this year. - For each of your goals brainstorm the first 3 steps needed to accomplish that goal. Let’s take our example of acquiring 4 rental properties that generate a passive income of $1,000 or more a month in 2011. To accomplish this, you need to join a group of real estate investors and find a mentor. Then, with your mentors help, you can define a target investment area. Next, you need to cultivate a group of Realtors to help you find properties in your target area…you get the idea.
- Take action right now! In our example, you can find a group of real estate investors and mentors without leaving this website. Sign up for a Lifestyles Unlimited® Free Workshop to find out what education and mentoring we offer! You can register to attend a case study to meet our members, mentors, realtors and vendors to begin building your team. If you are already a Lifestyles Unlimited® member, you can take a look at the calendar and schedule the next 3 events you will attend to get motivated and get going again! Need more encouragement? Call our office and speak with a mentor who can help you get started.
Be proactive. Make things happen. It will change your life!
Others may relate to your health: Lose 2 pounds a week through improved diet and exercise.
Maybe your goals relate to relationships: Communicate more openly with my spouse so we can solve problems as a team; or calling a friend at least once a week, just to catch up, in order to maintain your emotional health and theirs!
Write your goals down and put them someplace, like the bathroom mirror, so they stay top of mind.
Habit 2: Begin With The End In Mind
The effective real estate investor is already on this path. They have set goals based on their desired outcome. Whether it is more passive income, a healthier body or better relationships, creating an effective road map begins with a solid understanding of where you want to go.
Understanding the things that are deeply important to you is life changing in itself. It may take some time to break through the noise to the things that mean the most to you. You may be surprised! You may discover that previous goals were not really your goals, they were the expectations of others. Many people follow whatever ladder of success is set before them, only to realize that no matter how far up the ladder they climb they are not happy because the ladder is leaning against the wrong building. They are fulfilling someone else’s dream, not their own.
If this is you, stop right now and focus on your own hopes and dreams. Take the time you need for reflection, this is a critical step to your success. I know you are busy. This will help you stay busy doing the right things, so invest the time now to make sure your ladder is propped against the right building.
What do you want your legacy to be? What do you want your friends, family and community members to say about you at your funeral? What is your definition of success? Work backwards from there to identify your true goals and objectives. Write your goals down and put them someplace, like the bathroom mirror, so they stay top of mind. They will keep you focused on what is important to you.
The effective real estate investor has already bucked the system. Well meaning friends and family have told them that they will not be successful, it is not the right time to invest in real estate. They have told them all the tenants, taxes and toilet stories they can think of to save them from this mistake. The effective real estate investor has broken through the clamor, realizing that real estate is one of the best ways to create passive income streams, allowing them to pursue the things they are most passionate about in life – even if it is not real estate related!
Your goals are a personal mission statement. Focus on the things you can control. Much of what you worry about each day is out of your control. When you let go of those things, and spend your energy on just the things you can control, you will have a bigger impact. It is important to examine the lens through which you see the world. Is something coloring your vision? Your spouse, your family, your relationship with money, your work, your feelings about your possessions or the pleasures you seek, your friends, your enemies, your religion or belief system and your view of yourself all color the way you see the world. Work to strengthen those influences that are positive and lead you toward your goals, and eliminate those that create a false belief system that stands in the way of your success.
Stephen Covey says, “The ideal, of course, is to create one clear center from which you consistently derive a high degree of security, guidance, wisdom, and power, empowering your proactivity and giving congruency and harmony to every part of your life.”
The effective real estate investor knows this is a journey. They systematically work on self improvement and understanding while at the same time investing in real estate to create passive income streams to pay the bills and provide the lifestyle they desire.
Habit 3: Put First Things First
The effective real estate investor puts first things first. They have developed their proactive nature. They have examined the lens through which they view the world and cleared up the things that blurred their vision revealing their unique opportunity to contribute. They know where they are going and why.
Putting first things first, according to Stephen Covey, “…is the exercise of independent will toward becoming principled-centered.” With the strong foundation you have built working on the first two principles of an effective real estate investor, you are now ready to discover how you can take control of every aspect of your life and align your actions with your belief system.
Self-management allows you to live your life on your own terms. You don’t let the day happen to you, you make the day happen! This empowerment comes from making active decisions about your life instead of passively allowing others to make decisions for you.
As you move through your day, keep your goals in mind. Focus on your critical next steps. This allows you to take the actions necessary to make your goals your reality. Often the right choice for you will not be the easiest, or most enjoyable. Your sense of purpose will help you to do the things that are necessary to succeed.
Now you have the determination and the skills to conquer the things in your life that take up most of your time and produce little, if any, desirable results. Develop the ability to focus on those activities that are most important. Beware the urgent tasks clamoring for your time and attention. Much of what is urgent in your day is not important, it is the result of someone else’s agenda. Work first on the items that are both urgent and important to you, and then move on to other important tasks. Unimportant tasks can wait, even if they are urgent, and often they become unnecessary. You know how this feels! You have had those amazing days where you felt very productive and you achieved great results from your efforts. The results you achieve will become your motivation to make this process a habit. Real estate is simple, but it is not easy. There are a lot of moving parts in a real estate investment deal. The effective real estate investor stays on top of those details by doing the important things first and letting someone else take care of the rest.
Effective real estate investors are pursuing a lifestyle. They seek balance in their lives and they are aware of all the roles they have in life. They have goals for their own personal development, for their relationships with their family, and for their real estate investment career. What roles do you have? What are your goals in each of those areas? Effective real estate investors know it is important to have the answer to these questions, because they form the “bigger picture” that allows them to put first things first.
Habit 4: Think Win/Win
The effective real estate investor works well with a wide variety of people in all kinds of situations. Stephen Covey notes that, “Self-mastery and self-discipline are the foundation of good relationships with others.”
Through the first three habits you have worked to become independent. You are value driven and clear about your priorities. You are motivated and proactive. You have taken the time to develop a clear vision of what you want out of life, and to formulate goals and an action plan to make that vision a reality. Now, you are prepared to build the interdependent relationships necessary to successfully invest in real estate. A key component of successful interdependent relationships is that they are win/win. Zig Zigler puts it this way, “You can have everything in life you want if you will just help enough other people get what they want.”
Real estate investing is satisfying because it is a win/win proposition. You help a property owner or a bank out of a difficult situation by buying a distressed property. You create income for lenders, construction trades, insurance agents, home warranty companies and many others. You provide a nice place to live for your renters, and everyone benefits when the “blight” of the neighborhood is renovated and is now one of the nicest properties on the street. Then you look at your bottom line! Over time, this property will make you money 6 ways: cash flow, equity capture, forced appreciation (the value is forced higher when you renovate a distressed property), market appreciation, principle pay down as your tenants pay the mortgage, and the tax advantages you receive as a property owner. Creating win/win deals in real estate is good business!
At Lifestyles Unlimited® we talk a lot about the importance of having an abundance mentality. This does not come naturally to most people. We grow up learning that in order to win someone else has to lose. You may be surprised by those people who are actively working to create a win/lose situation. Instead of looking for mutually beneficial relationships they are jockeying for the advantage. They will not be happy until they get the “win”. The problem is that in order for them to feel they won, they have to be sure you lost. Stephen Covey points out that “creating mutually beneficial relationship takes great courage and consideration, especially when interacting with others who are deeply scripted in win/lose.” As you develop more experience and self confidence it will be easier to display this courage and consideration.
There are plenty of real estate investment opportunities, if you find yourself working with someone who is deeply entrenched in a win/lose mentality move on. Work with your mentors, and other like-minded investors, and you will learn to follow a step by step process that will reduce your risk and greatly increase your ability to create win/win deals.
The effective real estate investor looks for ways to create win/win situations in all areas of their life.
Habit 5: Seek First To Understand, Then To Be Understood
The effective real estate investor knows that interpersonal communication is the most important skill in life. Most of our time is spent communicating, so learning to do it well will have a big impact on our ability to succeed. We learn many communication skills in school. We learn how to read and write, and many of us learn how to present our ideas to others. The effective real estate investor knows that learning to listen empathetically leads to better relationships and clearer communication.
You have done it, and so have I – formulated your response while someone else was talking. After the first few words you hear, your mind is racing. You may be so focused on your own thoughts that you actually interrupt the person speaking to you in your attempt to respond quickly. Learning to listen well provides a decisive advantage. When we respond without truly listening we play out our own life on someone else’s screen. It leaves the other person feeling empty and misunderstood.
Empathetic listening is more than active listening. Empathetic listening takes in not only a person’s words, but also their body language and expressions. It allows you to hear their heart. This gives you much more information to work with, and the ability to understand what the person in front of you really needs and wants. Only then can you craft the mutually beneficial relationships we discussed in the section on win/win.
Learning to listen, really listen, takes time. It is a new habit and will require your focus and effort to avoid falling back into old communication styles. When you listen empathetically you become more vulnerable as well, so build this habit by starting with someone close to you. Choose someone who will really benefit from the psychological space to express themselves. We all approach life differently, think differently, respond differently. Taking the time to understand the person you are talking to gives you insights that allow you to form a closer, stronger, more rewarding relationship.
Knowing how to be understood is the second half of Steven Coveys 5th Habit. Because you first focused on understanding, you now have accurate information to work with. As you begin to communicate you have the opportunity to demonstrate your understanding of what the other person thinks and, often more importantly, feels. When you show them that you understand them you build credibility. As you show the depth of this understanding, and your respect for their point of view, you build a relationship based on integrity and trust. Then, if you can present your ideas clearly and in the context of what they have communicated, you will be understood as well.
Effective real estate investors know that learning to listen and understand the person they are with will allow them to frame their business ideas in a way most likely to result in the win/win outcome they are seeking. They take the time to develop this skill, and to use this approach deliberately until it becomes a habit, something they do without thinking. Then they enjoy the results – more satisfying interdependent relationships and more business success.
Habit 6: Synergize
Effective real estate investors know that real estate, like most things in life, is a team sport. Some started their investment efforts alone, and learned through costly mistakes that they needed to surround themselves with a strong team and a successful mentor to succeed. Some found a peer group of like-minded people to share information, advise and mentoring before they began investing. They were able to learn from other peoples success instead of from their own mistakes. You have already found a peer group with mentors and vendors to help you succeed! You are ahead of the game already and well on your way to being an effective real estate investor!
Synergy is a natural phenomenon. We see it all around us, when creative cooperation results in a whole greater than the sum of its parts. It’s that old saying that, “Two heads are better than one.” When you work with others you create new alternatives, paths that were not there before. All of the habits you have developed up to this point come together to allow you to successfully synergize with other people. You have learned to respect and understand differences, build on collective strengths and work together to compensate for weaknesses. You have learned how to listen well, and how to be understood. Synergy joins our analytical side and our creative side to spark win/win solutions.
Lifestyles Unlimited® is a clearing house for all things real estate related. You can find the answers to your questions from the mentors, realtors, vendors and other members here. It is amazing what you can learn in casual conversations, and the resources that become available when you can ask questions and share ideas with people who have similar goals. You can learn and grow from being around people who are more successful real estate investors than you are, and you can give back by teaching others who are just beginning their journey toward financial freedom through real estate investing. Lifestyles Unlimited® is a great example of synergy.
The effective real estate investor looks for a mentor who has successfully invested in real estate and is now living the lifestyle they desire funded from the passive income they receive from their investments. They surround themselves with like-minded people by finding a local group of real estate investors and participating in group events. The effective real estate investor does not try to go it alone. Instead, they synergize with others so everyone can achieve more.
Habit 7: Sharpen The Saw
The effective real estate investor understands the value of self renewal and becoming a lifetime learner. There are so many ways to boost your energy and excitement for real estate investing! Here are just a few:
Take time to exercise and stay healthy. When you exercise and eat well you release endorphins that make you happier and increase brain function. Tony Robbins recommends exercise first thing in the morning. If you are really struggling he suggests you sleep in your running clothes and put your shoes by your bed. If you are waking up, then you are going for a walk or a run! Roll out of bed and into your shoes! Let the momentum carry you out the door. Once you are more active, it will be easier to eat a healthy diet. Exercise will release the endorphins your body is craving. Exercise, good nutrition and good hydration keeps your mind at peak performance for analyzing deals!
Take time to periodically re-examine your values and belief system. Make sure your behavior reflects your core beliefs, and your motives are aligned as well. Drill down to what you really want. It reveals your core beliefs and is the wellspring of your motivation. Keep asking “why?” until you get down to the simplest concept.
Take time to forgive yourself for your failings and let them go. It is important to learn from the past so we do not repeat the same mistakes, then it is time to move on. Give yourself credit for the things you do right. You are reading this article to become a more effective real estate investor, give yourself credit for taking action! Don’t spend any more time looking in the rear view mirror! Each day is a new opportunity to take action and move closer to achieving your goals. Learn from where you have been, but focus your energy on where you are going.
Take time to develop your mind, become a lifelong learner. On our website you will find a recommended reading list. Read the books listed there, and talk with your friends, family and fellow real estate investors about the books they are reading. Continue to read the articles posted on our site and others of interest to you. Attend educational seminars, case studies and classes. Attending live events provides an opportunity to ask questions, interact with the presenter and network with other investors. Meditate, learn a new craft or hobby. Life is about the journey, not just the destination. Take time for you along the way.
Take time to build your emotional resilience. As you learn more about yourself you will become more confident. When you begin to execute your plan you will feel more successful. Stay focused on the things that truly matter to you, your core beliefs. Then, when you feel stressed or bad things happen, you can return to your center and put things in perspective. Emotional resilience is developed over time as you learn to take positive action in the face of difficult circumstances.
Take time to help others. Real estate investing is an amazing business because of the potential to help so many people with just one deal. As you become more experienced, you begin to mentor others and your wake begins to ripple out changing lives.
The effective real estate investor takes time to renew themselves and to bring balance to their life. They know this is the key to success. You are in this for the long haul, this is the path you have chosen to secure your financial future. Take the time to nurture yourself so you can invest in real estate with energy, creativity and enthusiasm. Find a mentor who has been successful and follow them, and help others along the way. This allows you to see the opportunities in front of you, to move past fear to action, and to draw others to you who will gladly help you succeed!
