Epic Real Estate Investing - Top 5 Questions Every Real Estate Investor Needs to Ask About Maximizing Profit and Saving Time | 769

Episode Date: September 8, 2019

Do you want to maximize your profits and save time with real estate investing? Tune in, Matt has some hot tips for you!   Learn more about your ad choices. Visit megaphone.fm/adchoices

This is Terrio Media. Success in real estate has nothing to do with shiny objects. It has everything to do with mastering the basics. The three pillars of real estate investing. Attract, convert, exit. Matt Terrio has been helping real estate investors do just that for more than a decade now. If you want to make money in real estate, keep listening. If you want it faster, visit R-E-I-Ase.com.

Here's Matt. Hey, Rockstar, it's Matt Terrio here from Epic Real Estate. And today I want to give you the top five questions. Every real estate investor needs to ask about maximizing profit and saving time to just overall becoming a better real estate investor. You know, as the other day, I was welcoming a brand new RIA's client into the program. And after a little bit of a conversation, it was really clear that they were leaving a ton of money on the table and wasting a bunch of time doing it.

And so before we ever really go to work together on someone's business and on their business specifically, I had to take them through five questions that every real estate investor really needs to ask themselves about maximizing their profit and saving time. Just overall getting more efficient. And they revolve around an investor's basic strategy and their decision-making process. You know, having a clear real estate business strategy is just as important as having a business plan. Because, you know, it's without a clear strategy, you're going to lose deals due to slow decision-making. You're going to constantly be second-guessing yourself and you're going to be constantly second-guessing your market.

You're going to find it impossible to see the light at the end of the tunnel to all that real estate promises. But with the clear strategy, you're going to be able to make quick. confident decisions and actually reach the goals of financial freedom that you signed up for when you decided to become a real estate investor. It takes just five important decisions to create this clear real estate business strategy for yourself. And before I go there, if you'd like some help with your real estate investing business, I mean, if you'd flat out just like me to set it up for you, so all that you have to do is to start talking to sellers, setting appointments and closing deals, I just put up a new training showing you how I do this for

our REIACE clients. And if that sounds interesting to you, head over to REIACE.com and take a look. If you like what you see, there are simple instructions on what to do next. All righty? So let's get back to it. The first question that every real estate investor

needs to ask about maximizing profit and saving time is, do I want cash or do I want cash flow? There's a big distinction there. You know, cash, that's a lump sum in your pocket all at once, but it comes just one time. And then there's cash flow, which is a positive stream of income that comes over a longer period of time or a periodic payments. And if you intend to create cash flow for every property that you come across, if that's your true intention, you're going to reach financial freedom 10 times faster.

I mean, I've literally done the math. It is 10 times faster. And it's a little counterintuitive in the beginning as you're watching the math, unfold. But holding property for their cash flow, that's going to get you to your financial freedom 10 times faster. And there's nothing wrong with flipping for chunks of cash. All four chunks of cash. I love chunks of cash just as much as anybody else does. But just know that if you don't set aside portions of that cash to create cash flow, you're going to be flipping properties for the rest of your flipping life. So if you're okay with that,

so am I. I am not here to disrupt whatever makes you happy and whatever you want to do. You just need to ask yourself, though, you need to be clear and answer the question, am I out for cash or am I out for cash flow? All right, so that's question number one. Number two, which market should I invest in? So the very best market for you, the best market for you to invest in is the market you're actually going to work and that you're actually going to. to work consistently with a high level of persistence. Don't fall prey to the grass is always greener syndrome and hop around to whatever market

looks easy from the outside or whatever market you saw somebody else, then it looks like they're doing really well in. And so now you're going to jump over there because it seems all the opportunities over there. And then if you maintain that process or that thought process, you're just going to jump to the next market next month and the next market the next month. And you just got to stay. focused. As long as there are people in your market and they live under roofs, there is opportunity

there for you to make money in real estate. There is opportunity, enough opportunity there for you to create a really nice living for yourself and grasp and just take a hold of all the financial freedom that real estate does promise and that real estate does deliver as long as you bring yourself to the party. So with regard to the market, I highly recommend that beginners work close to home. I really recommend everybody work close to home if you can because the reason is you're more inclined to actually work that market. You're more inclined to work where you spend most of your time. And so I recommend getting started finding the closest blue collar neighborhood. A nice working class neighborhood. Doesn't have to be high income, doesn't even have to be middle

class, it can be nice working class, but they do have to have jobs. So find that closest blue collar neighborhood or where maybe a first-time buyers are attracted to, where that new couple, they move in and they're all happy about their house. But as soon as they mature a little bit, start making some money in their own professions, they're ready to move out and upgrade those areas. Because there's lots of movement in those neighborhoods and you're going to find an ample amount of opportunity no matter which side of the transaction you're on, meaning there's a lot of buying going on in those areas. And so once you've got a few deals under your belt and you feel that you really must look for greener pastures, then go for it. Okay. Just be wary of the trap that another market is easier than where you live right now because they all require work and they all come with their own unique challenges. All right.

So that's number two. Number three, what property type should I invest in? So should is a big word, right? I'll tell you what I recommend. I recommend single family homes for beginners just because they're simple. They're easy to understand. And they're really simple to work with. And they're in abundance.

Eventually, it would probably be wise to move on to a different type of property or just add an additional type to your practice. So you diversify your portfolio. But go deep before going wide. Whichever one that you do choose to get started with, go deep before you go wide and start adding a bunch of other. property types into the mix. Master your property type before rushing off to something else.

You know, every property type has its dips in the road, has all that stuff here too. They all require work and they all come with their own unique challenges. But they can all make you a lot of money if you commit to one and master it before adding another. All right. So that's number three. Number four, what's my definition of a deal? and this one is frequently overlooked. Sometimes it's ignored.

Often it's forgotten. It's underestimated. You know, even when you're totally clear that it makes sense to understand your own definition of a deal, it's really easy and in common to lose sight of how important it is. You know, just to give you an idea, investors that I've worked with for years, they will still come to me this day. I mean, they're very accomplished. They're very successful.

but they'll still come to me to this day asking me about this new deal that they got. And their big question is, should I do it or shouldn't I? What would you do in my shoes is the type of question that I get when it comes around that? And the answer to the question is always the same. It always lies within their own definition of a deal. So for a property to be a deal to you, to whether you should move forward and invest in it or not, it should be in your market. it should be your property type, and it should produce cash or cash flow to your liking.

It's really simple. If it doesn't check all of those boxes, especially that last one producing cash or cash flow to your liking, then it's probably not a deal for you. And you'd probably be better served moving on to the next one. Or, at the very least, keep negotiating with the seller to structure price and terms so that it does check all of those boxes for you. you. So before you look at your next deal, you should probably answer these two questions right after this podcast is over. Number one, if you're going to flip a property, what's the minimum

profit you're willing to accept? If you're going to buy something low and you're going to sell it high, once it's all said and done, what's left over for you? What's the minimum amount of money you're willing to go through all that work and do and be compensated for that amount? Okay, so that's number one, what's your minimum flip amount? Second is if you're going to hold the property, what's the minimum amount of monthly cash flow you're willing to receive? And you can answer that in a dollar amount, like $200 a month is my minimum cash flow, or it could be based on how much money you put in, so your actual ROI. So I need at least a 15% cash on cash return, 15% return on investment. Okay. So I have an answer for your flipping minimum and you're holding minimum.

And when the next deal comes along, it's going to be really easy. Does it fit? So now you'll get to know whether you should move forward and take advantage of that deal or not. Am I going to make this amount of money? Okay, well, that was my minimum profit. It's going to pay that. So let's do it. And those numbers can change, and they will change over time.

The better you get at this, the more deals you do, the better your lead generation gets. The better your conversation and conversion techniques get, the higher your standards are going to go. All right? So you're going to make more money. better you get. So you don't have to stick with them, but you should have a definition on any given day of what that is. So when you look at a deal, you can make a quick and easy, informed, educated decision. So that's number four. Number five, and this is the last question. How do I find my deals? How am I going to find my deals? Because none of your education or strategy

matters if you can't find your deals. Like if you answer all of these questions one through four, none of that matters if you can't actually find the deals to execute, right? If you can't find the deals to implement all this cool stuff on. So none of that matters. This is the most lucrative skill of an investor's finding deals. The person that has the deal under contract is the person that has the power. Contrary to popular belief, it is not the person with the money. So if you're getting started and you don't have the money to do it, it don't matter.

You can get the power. You can get the leverage by going out and finding good deals and locking them up under contract. There's no shortage of money in the system for a good deal. If you don't have this skill, whether you got the money or not, if you don't have this skill, you're going to overpay for real estate. If you do have this skill, people are going to overpay you for real estate. You know, there's a lot of truth in the saying, you make your money when you buy real estate. You've heard that before?

Did you make your money when you lock up the deal under price and terms that meet your definition of a deal. That's when you've made your money. That's when you've got confirmation that this is going to compensate you in the way that you want to be compensated. So very similarly to your property type, you want to go deep with a marketing strategy to generate your seller leads and practice your craft and perfect your technique and talking to your seller leads to create win-win situations between you and the sellers. So lead generation, very important. That's step one. It gets you into the game. But really, it's your seller dialogue. That's what wins the game. It's that conversation. It's the negotiation. It's the people skills that wins the game.

That's how you find deals. You see, by developing your people in negotiation skills, by developing your problem solving skills, your creative deal structuring skills, you're going to find deals for yourself right underneath your competition's nose that that they can't see. Like it's right there under their nose and they're not going to be able to see it. You got a bunch of one-trick ponies that know one way to do this. And that's a really big portion of what we do with our clients inside of the REIACE program. We first set up their entire business systems and then we teach them how to execute those systems. And a big portion of that is what do you do after you find the lead, right?

Once you've got the lead, how do you lock it up so you've got confirmation of a minimum amount of money you're going to make? And then how do you exit in the highest and best possible way so that you make the highest and best profit for yourself, whether that's cash or cash flow. And if you'd like to go deeper and see how we do that, then take a look at the new training that I just put together. It's up and live right now at rei-a-a-com. Have yourself a look in and let me know what you think. If you want to hop on the phone to discuss, you can let me know that there and then we'll make it happen. All righty. If nothing else, those are five questions. Every real estate investor really needs to ask themselves about maximizing their profit and saving time. Just getting more efficient. That's probably

something you want to do is answer those questions like right now as this podcast is ending. Do yourself that favor because your answers to those will point you in the right direction. And if you'd like some help, putting it all together and moving a little faster, now you know how to get it over at r-e-I-a-a-s.com. And if not you, who do you know that might be interested in? something like that. Pass it along. Share it with a friend. Ready? That's it for today. God bless to your success. I'm Matt Terrio. Living the Dream. Yeah, yeah, we got the cash flow. Yeah, yeah, we got the cash flow. You didn't know home board. We got the cash flow. This podcast is a part of the C-suite Radio Network. For more top business podcasts, visit c-sweetradio.com.