If you are not a property investor, imagine for a moment that you are. Now imagine others in your industry constantly approaching you with new opportunities. Do you look at each and every one that comes across your desk? You should.
Property investing is unlike any other type of investment. It shares similarities with other investments, but there is so much about property that makes it unique compared to stocks, bonds, commodities, and precious metals. That is why every opportunity is at least worth looking at.
The More, The Better
Looking at opportunities in real estate investing has been compared to taking shots in a hockey game. Picture two hockey teams: one that shoots as often as possible and another whose players are reluctant to shoot. Which of the two teams has more opportunities to score? The team that shoots more frequently.
A hockey team will never score a goal if it doesn’t shoot. On the other hand, shooting as frequently as possible creates more opportunities for the puck to find the net. Looking for opportunities in real estate is very similar. The more, the better.
Not Every Opportunity Is a Good One
Just as in hockey, not every opportunity to obtain a new property is a good one. That is why this post is based on the premise of looking rather than buying. An investor will never know the opportunities that lie in front of him if he doesn’t look. Best of all, there is no harm in looking.
Actium Partners, a Salt Lake City, UT hard money lender specializing in commercial real estate, explains that investors tend to turn down more opportunities than they accept. But opportunities are turned only after being looked at.
Investment opportunities can be unattractive because the profit margin is too small. An opportunity can be turned down because the property needs too much work, zoning and other issues restrict its use, or even because it doesn’t fit into an investor’s current portfolio. And yet the smartest investors do not dismiss opportunities without checking them out first.
Shots Don’t Always Find the Net
Not looking at opportunities is the equivalent of a hockey team not shooting the puck. Going after an opportunity but losing out to another investor is the equivalent of shooting but not finding the back of the net. It happens.
Real estate investing is a highly competitive business. It is not uncommon to put a tremendous amount of effort into a new opportunity only to fail in the end. How does an investor avoid failing more than succeeding? By creating and following a strategic acquisition plan.
To illustrate the point, consider the speed at which commercial real estate transactions take place. When a hard money lender like Actium Partners is involved, an investor can get from offer to closing in a matter of days. That’s fast.
It’s so fast that multiple competitors for the same property often find themselves competing on funding speed. The investor who can get to closing the quickest ends up winning the deal.
It’s All About Opportunities and Offers
Succeeding in real estate investing requires competing against the best investors in the market. It’s all about looking at opportunities and putting together winning offers. Do that and you will build your portfolio over time.
As far as opportunities are concerned, never dismiss one out of hand. At least take the time to look at every opportunity that comes across your desk. And when you find opportunities that look attractive, take a shot. The worst that could happen is that your puck doesn’t find the back of the net.