Disclaimer: I'm not a guru! I have done short sales, subto's, and conventional deals, but I still don't consider myself one since I'm not yet a millionaire. So here's my 2 cents worth..
After spending some time getting my business fired up again (it needed a big kick in the a$$), I was pondering the basics of REI. What is the essence that makes one investor flourish and the other fail. What is the secret to success.
Since I'm an engineer, this equation suddenly popped in my head:SUCCESS ($$) = TIME*LEADS*OFFERS
(ok, so the units don't work out but you get the point) The variables are multiplied by each other so the larger the variable, the larger the success.
Time: The amount of time you are actively working REI in every aspect.
LEADS: The amount of solid leads that are worthy of an offer.
OFFERS: The amount of offers you make on solid leads.
Wow is it that simple?? I think it is.. And I think the successful investors are the ones that are able to maximize all three at one time and do it well.
For those who are interested, these are my three VARIABLES:
TIME: Time is limited for me since I have a full time JOB. But that doesn't mean I can't be a millionaire in a few years. It does mean that I have to focus my time to maximize LEADS and OFFERS. This means systems need to be in place. And I do have systems in place.
LEADS: A few years back, I noticed that marketing would be very important to my business. The best scenario for us REI'ers is to have motivated prescreened sellers calling us all day, everyday. This is what I'm doing to accomplish this.
- Postcards to foreclosure lists, farm areas, absentee owners
- Letters to properties on my dirty 30 list (properties I see that look vacant or are distressed)
- Door knocking
- Bandit Signs
- Car magnets
- Business cards
- Birddogs such as appraisors, attorneys, realtors
All of these items are in various stages of success and failure.
OFFERS: I made 5 unsuccessful offers in Jan. None in March (pathetic).
This has been a good excercise for me because I can now see what my weaknesses are. This will change quickly.