Seven Habits Of Highly Effective Real Estate Investors
I first read The 7 Habits of Highly Effective Teens in high school after it was recommended by my librarian (thanks, Mrs. Webster!). Pretty soon after, I read The 7 Habits of Highly Effective People and many other similar business and self-help books. When I recently noticed how many other business tips really stem from the principles of Covey’s books, I decided to revisit the principles to see how they can be applied to real estate investing.
Habit 1: Be proactive.
Covey introduces the ideas of Circle of Influence and Circle of Concern in his book. Imagine two concentric circles. The bigger circle, the Circle of Concern, is all of the things you can worry about going wrong in real estate: contractors not showing up, water heater breaks, investors backing out of a commitment. Inside that circle is a slightly smaller one, the Circle of Influence, for items that you have control over.
Life is 10% what happens to you and 90% how you react. As investors, we must be proactive, control the controllable to expand our Circle of Influence. Accept responsibility for situations and take initiative to make things better. Waiting for problems to happen or taking a woe-is-me kind of attitude will get you nowhere.
Habit 2: Begin with the end in mind.
This goes far beyond envisioning how you want your fixer upper to look at the end of construction or the conclusion of an investor pitch meeting. You also have to have a picture in mind what you want your life to look like in the end and your relationships with the people who matter so you don’t end up working aimlessly. Lots of motivational gurus talk about your “why” or “finding your purpose” ad nauseam — and the reason they do it is because it’s important. What is your personal mission? Spread the gift you were put on this world to give.
Habit 3: Put first things first.
As real estate investors, you have a myriad of to do’s. Prioritizing is key. Break out everything you have to do into a two-by-two matrix, with one axis labeled important versus not important and the other axis labeled urgent versus not urgent. We don’t have any problems with quadrant one, the important and urgent tasks, and although it might take some discipline, for the most part, we know to tune out the not-important and not-urgent time wasters.
However, we often overspend our time in the not-important-but-urgent quadrant and under-invest in quadrant two, the important but not urgent items that will pay many more dividends down the road. We need to delegate or decline the busy work and focus on what will sustain our business in the long run, and that is building relationships with brokers, agents and various tradespeople.
Habit 4: Think win-win.
Most investors are deal junkies, but we must take the long view. Win-lose situations don’t build trust over time. You might want to ask the agent or broker to reduce their commissions, but you have to realize the pie is big enough for everybody. The reason it is hard is because it takes a tremendous amount of integrity, maturity and, most of all, empathy. When you are able to do that, you can bet you will get tons of repeat business in the future.
Habit 5: Seek first to understand, then to be understood.
Listen first. Ask questions. Too often are we ready to jump in to defend our position in negotiations or apply our own lens to the problems that we miss out on the opportunity to peel back the onion to get at the deeper-rooted issues. Per Aaron Burr’s advice in the musical Hamilton, “Talk less. Smile more.”
Habit 6: Synergize.
What if 1 + 1 = 3 or 30? Often, complicated deals require innovative solutions. Could you perhaps work out a seller financing option or installment sale? Would an option contract make more sense for both parties? It’s not about your way or my way or even a compromise; it is about finding our way.
Habit 7: Sharpen the saw.
We must remember there’s more to life than money. Money is just a funny way of keeping score. What is the point of working yourself to the bone? Take care of your body, heart, mind and spirit to periodically recharge and you’ll actually achieve your peak performance.
Written by Jason Hsiao. Original Article: https://www.forbes.com/sites/forbesrealestatecouncil/2020/04/20/seven-habits-of-highly-effective-real-estate-investors/