Warren Buffett wrote last year in a New York Times op-ed piece called ‘Buy American. I Am.’ that “A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful.” Of course, he was referring to stocks. However, I believe the same is true for investing in real estate.
It’s easy to find the fear. Just pick up your local newspaper. My daily reported last week that ‘45,000-plus Valley Properties Remain in Foreclosure’. If Warren Buffett is right then I guess now is the time to start building your real estate empire. But, before you go out and pay big bucks for a real estate seminar to learn how to wholesale, short sale, buy at the courthouse steps, or lease/option remember this: real estate is a local business.
In June of 2002, I flew to Atlanta and paid $2,700 to learn how to get banks fighting to lend me money. This was the second seminar I attended that year. The other was a workshop in Denver where I spent $1,200 on a lease-option course. Unfortunately, all of this real estate education was getting me nowhere. The banks I talked to weren’t fighting to give me money. Actually, I think they were laughing at me. The lease-option strategy netted me a little cash but certainly not enough to quit my day job.
Then I called a local real estate attorney named Bill Kozub for some advice. Bill had a great sense of humor. He told me that he used to be a real estate broker and later became a real estate attorney to kill his own deals. That was funny. Bill set me straight right away. He told me to stop wasting time and money traveling all over the country. I needed to find a real estate investor in my home town that could teach me the business.
Through a little networking and detective work I met one of the most prominent, and discreet, real estate investors in the state. He made me a simple deal: I get a contract with a homeowner in foreclosure and he provides the leads, money, title company and buyer to close the transaction – we split the profit. Because I was ambitious and willing to serve he shared many of his investing secrets with me. I spent a year as his apprentice and he never once asked for anything in return.
Don’t get me wrong. I believe there are many quality real estate education programs out there that will help you reach your goals. Next month I’m enrolling in several, including a class on using self-directed IRAs for real estate investing and a business financial management class. My point is that much of what you need to know in real estate isn’t taught in the classroom.
Attend a local real estate investment class. Talk to a realtor, title company representative, your church pastor, anyone who might know the millionaire real estate investor next door. And when you find the millionaire real estate investor next door, be ready to serve. It’s like Jim Rohn once said, “Whoever renders service to many puts himself in line for greatness – great wealth, great return, great satisfaction, great reputation, and great joy.”