They say the most important factor in successfully investing in real estate is “location, location, location.” Of course, the location in which you invest plays a critical role in the success or failure of a property. However, is it still the most important aspect of any deal? Some would say it is, and others that it is not. Where do you stand? Does location really trump everything else?
In today’s investment landscape, location is very important, but not the most important thing an investor can account for. In fact, there is one thing far more critical than location: real estate education. There is nothing more important to an investor than their education. Having a comprehensive knowledge of the investing business is the best thing an investor can accomplish.
Unless you’ve got the real estate education and knowledge beforehand, nothing else is likely to fall into place quite so easily. In a best case scenario, you’ll probably waste a lot of time and not make as much money as you could have. Many others have found that ignoring learning and rushing in has bankrupted them on their first deal. Besides, without education, how do you even know the best location?
If location is your compass for investing in real estate, how do you find the best cities, neighborhoods, blocks, and lots? Forget yesterday’s hotspot list in the news. They could be blown out by now. Where should you be investing next? What fundamentals make a great city to invest in? How do you determine the best zip codes in those cities? Deals can be top or flop, even depending on the lot and view they have. So how do you know what to look for if you haven’t invested in learning first?
In reality, each opportunity is only as good as the execution. The best property on the best lot can be a complete flop if the deal isn’t set up right. The most successful investors are usually those that get to pick up these prime properties when others drop the ball. Which part of that equation do you really want to be?
The Biggest Threat to the Real Estate Industry
Uneducated investors and ‘professionals’ are easily the biggest threat to the U.S. real estate market. They crush the reputation of the industry, buy poorly, manage worse, and set things up for a fall. That’s bad for everyone.
If you aren’t really on top of your game and working to protect the market, you are doing the opposite. Think about most foreclosures. Who really went into foreclosure on purpose? Most of the millions of properties that have been defaulted on have been the result of lack of education in one way or another. Buyers weren’t savvy about borrowing terms, market cycles, or sound investment principles. This does not reflect an investors IQ; it is strictly in regards to their real estate education. It’s about taking time to learn the ins and outs of real estate and investment. You can be a great brain surgeon, but that might not make you the best rehabber or landlord. What’s the difference? You went to medical school for years to master your field. So isn’t it worth spending a few weeks or months learning real estate before putting all those years of earnings and savings on the line?
It gets worst for those that don’t have a lot to start with, and that really need real estate to work for them. If you don’t have much room for loss, then you will want to beef up your real estate education. Find a system that already works and plug that in.
The ROI on Real Estate Education
It’s sad to see so many aspiring real estate investors get lost online. Some have already bankrupted themselves by paying cash for the wrong properties, which they can’t rent out or resell. Others have gotten themselves into sticky legal messes. Masses are wasting endless time following others with no more real experience than themselves. Remember, time is your most valuable resource.
Even if you don’t value your time at all, let’s look at how much more real estate education could add in profits. It is a tough calculation to pin down. There are so many different real estate courses and programs out there, and everyone is going to see different results based upon how they use that information. Let’s say you invest a few weeks or couple months in really learning your craft. If that knowledge nets you an extra $5,000 per month, that’s an extra $60,000 per year.
What if I Don’t Have Time to Learn?
If you can’t spare a few hours for a seminar, or a few hours a week to do a home study course, at least get representation. Find a good Realtor, attorney, mentor, coach, or turnkey real estate investment program that can do it all for you. Have them do all the work finding, evaluating, remodeling, negotiating, and managing your real estate investments instead.
