Its an age old question amongst real estate investors, entrepreneurs and really – all of human-kind. The Quality Quantity Conundrum. Where do you fall in the spectrum? You better have an answer to this question. Here’s why.
MORE MORE MORE = GOOD BETTER BEST?
Everywhere you look, there’s a quest for more, more, more. Bigger cars, bigger houses, bigger bank accounts, bigger boobs, bigger lips. You get the picture! I just gotta say it – what is it with these crazy woman who do this to themeselves? What is so lacking in their lives?
But I digress – let’s get back to real estate.
A DNA-level human quality tells us the more deals we make, the more successful we will be, but that’s a typical rookie-intermediate mindset and a common investor mistake.
A TALE OF FREE AND CLEAR
My good buddy Steve Cook likes to tell a story about three very well-known, successful and well-off Baltimore City Landlords who decide to take a 7-day trip to Europe. The first investor owns 1000 houses with bank financing, the second owns 150 houses with bank financing, and the 3rd owns 20 houses, free-and-clear. Round about the 5th day of the trip, one says, “Guys, I’m having such a good time – why don’t we stay another week.”
Can you guess which of the three made this comment? Can you guess how the other two responded?
Investor one with the 1000 houses, and investor two with the 150 houses, both rich guys each said, “No can do.”
Both their phones were ringing off the hook for the entire week. Tenant calls, management calls, vacancy issues, maintenance issues. You name it – the phone was ringin. With 1150 houses between them – each was sacked with issue after issue and each was tied to their respective business like a cinder blocks chained to their ankles!
Investor #3; Mr. Free and Clear, waived good-bye to his buddies as he alone stayed for the extra week!
I WANT IT ALL, CRAIG!
What if your competition is closing deals faster than the time it took for Kim Kardashian to file for divorce? Who cares! There’s one person and one goal you should be focused on – is you. Don’t obsess over how many deals you’re working. Seriously, this might be the best advice I could ever give you!
Here’s the deal. I’ve been there. I’ve lived the stress filled, anxiety ridden life of juggling 7-8 big rehab projects at a time. I know what its like to have several hungry lenders simultaneously looking for their monthly juice. I know what its like to manage a bunch of knuckle-head contractors. And let me tell ya, it ain’t fun!
When you’re working a ton of big deals at once, you don’t control the deals. They end up controlling you, and before you know it, your life and your time are no longer your own.
I once did a poll in a room full of investors. I asked them, “Why did you get into real estate investing? What are your goals?”
Almost every one of them responded, “Freedom. I got into real estate investing for more freedom!”
Let me be clear, there is very little freedom in working more than 3-4 deals at a time. Especially when those deals are “rehab” deals. The key to quality of life, and to your precious freedom is quality deals NOT quantity deals. Those investors who go for quantity are often the same who end up broke, divorced, and wondering how their kids grew up so darn fast.
Your business goals should never supersede your personal goals. The business MUST fit in to the personal. Never the opposite.
The internet is littered with Guru’s who claim to be doing 100′s of deals per year – and I know a lot of these guys. Most aren’t making nearly the money the claim to be making! Trust me on that!
It’s easy to be attracted to great deals – especially when you don’t have a firm grasp on what your end goals are, and that’s when the deals slowly start controlling you. You’ve got to go into every deal knowing precisely what you want to get out it, and your goals should be driving your decisions, not the appeal of taking down yet another deal.
Here’s an example;….say your short-term goal is to make money quickly. A few weeks later you come across a smoking hot rental where you know you can clear $500 a month after expenses. You then decide to buy the rental, which (as you well know) is a long-term investment. The decision to buy a rental completely contradicts your short-term goal for quick money, and now the deal has not only dictated your decision, but has also negated your original goal, and chances are you’re going end up with less money and less freedom.
The slide from Quality to Quantity is a slippery slope to an erosion of your freedom.
Remember, a quality deal is one that will contribute to the overall success and completion of your goals. It’s simple. If a deal won’t keep you on track and on your way to meeting your goals, it’s “talk to the hand time.” Stick to your plan, and invest your time, energy, and money on quality deals, and don’t worry about the competition. Trust me, they’ll be wondering why they have no life, while you seem to have it all.