The Biggest Myth in Real Estate Investing

The biggest Myth in Real Estate Investing, is that “Investing” is the best way to make money from Real Estate.

“What!?” I hear you saying.

Here’s what I mean:

“If you are burying your money, or even “OPM” – Other People’s Money – into Real Estate, just to sit and wait for that Investment to grow, you are doing it all wrong.”

You are lowering your results by 10 to 100 times, and making one tenth the money for 10 times the work.

Think of it like this: Does a grocery store “invest” in lettuce? Does a car dealer “invest” in new cars? Does a jewelry store “invest” in rings and necklaces?

No, they don’t. They buy those products at wholesale price and sell them at retail price. Or better yet, they don’t even buy them at all until AFTER they sell them.

I often tell people that I’m not a Real Estate “Investor” at all. I’m as much a Real Estate Investor as a grocery store is a lettuce Investor. That is, I buy houses BELOW their current retail value, with the clear intent to sell them for a profit.

I don’t pay full price, and hope it eventually goes up in value. I am a real estate entrepreneur. Real Estate is the product. The business is buying or controlling real estate and turning it to a buyer.

But that’s not what you’ll hear if you ask for advice from the wrong people. Real Estate Agents, Mortgage Brokers, and many others often harp about the importance of your credit score, or say you need a rich uncle to or an inheritance to get started.

That’s why the “Real Estate Myth” is such a terrible lie. Because it scares away so many people from getting started in the first place.

Most new Investors get stuck in one of two traps: either, 1) buy properties retail, rent them out, and hope and pray they go up in value over many years, or 2) buy fixer uppers, raise the cash and pay outrageous fees and interest rates, and let the real estate agents, the mortgage brokers, the hard money lenders and the contractors get most of the money while you do all of the work.

Not for me, thanks. I approach it from a Business perspective. Buy or control it for price “A”, turn it to a buyer for price “B”, and the difference is an immediate profit.

Just like a real business should be.

And when you get serious for a minute and approach it like a business, everything gets easier. When a grocery store wants to buy lettuce, does the owner whip out his wallet and use his own money to buy it? No.

Does he sign on the dotted line for a personal loan? No.

Does he pay for the lettuce, work overtime to truck it to the store, unload it, display it, run the register and do all of the things necessary to buy and sell it?

No. The business does that, and it pays him as well, by connecting Buyers and Sellers and profiting from the transaction.

When you can buy or control properties and connect them with their perfect buyers, that’s all you need to do. All of the phone calls and paperwork and other crap is done by someone else.

In fact, once you get away from Realtors and banks and brokers and all that crap, you start to realize there’s not all that much that you need to do, and most of that can be automated or outsourced.

Once you put this to work in your own life instead of settling for a seven or eight percent return, you can earn many times that in a fraction of the time, and provide for yourself and your family at a higher level than you now think possible.

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