New investors often find the cause of their early departure from the real estate industry to be the immense amount of time and dedication that is required. The idea that you can make more in one deal than you can in a year working your full time job is quite captivating. Sure, there is money to be made, but those kinds of deals come maybe once a year, or even once in a lifetime. The much more realistic scenario is that you can make a very good living, but it will take months or years to do so. You really get out of it what you put into it. Working hard and dedicating yourself will most likely pay off for real estate investors.
Regardless of what your strategy and approach to the business is, you need some level of patience. Even the quickest of flips or wholesale deals takes time to develop and time to close. If you are looking to get in and out as soon as possible, you may not be giving yourself the best chance to succeed. There is nothing wrong with moving the process along, but not at the expense of your bottom line. If you could hold a property for a year and see a 10% price increase when you sell, would you be willing to wait? Many investors would not. They make decisions based on where the market currently is or where they currently are in their business. To maximize profit and return on your investment, sometimes you need to exercise patience.
Any experienced investor will tell you that things oftentimes do not go as planned. There will be many bumps in the road along the way that will hold a deal up and delay the closing. Everything from items on title, insurance issues, property inspection items and buyer financing could bring the deal to a screeching halt. You should never assume that a deal is done until you have received the check at the closing. Items can come up any time before the closing date, and in some cases even at the closing. Be wary of jumping into the next deal until you are certain that your deal will close and you have the check in your hand.
Real estate can be a very profitable investment, but you may have to be willing to wait for it to appreciate. There is money to be made on quick flip deals, but the bigger pot of gold could be when the market turns and prices rise. This could take five to ten years, but eventually there will be a shift in the market and prices will go up. It is at that time that many buy and hold investors will truly see the value of holding onto their investment for the long haul. To be able to hold on to these investments, you need to be patient enough to build a portfolio while making enough with other properties to do so. If you can get to this point, the real estate business will provide wealth like no other investment can.
The real estate business is not nearly as easy as it may appear from the outside. It takes a tremendous amount of work and a great deal of patience. It takes time to build a network, a pipeline and a portfolio but when you do it will all be worth it.