The 5 Essential Elements of the Strategic Real Estate Investor
The 5 Essential Elements of the Strategic Real Estate Investor

Summer is here! That means many Canadians thoughts are shifting from camping, parties, socializing and of course real estate. And with that comes a focus on the latest and greatest headlines we are being inundated with about the real estate markets.

Economic trends, opinions, analysis and simple guesses will be tossed around the fire/cocktail parties all summer long. And of course these subjects can’t be outright ignored or you will end up a social outcast.  However, being drawn into conversations not based in the true understanding of the markets can be very frustrating for someone like you who understands just what drives a market (what REALLY matters and what doesn’t).

You will discover that people love to predict the negative (in anything) and this is true in real estate. So now is a good time, before it all starts in earnest to take a step back and re-focus. Why do we do what we do? What outcome do you want to create?

The truth is this: Your situation is only as good as you to make it, and the real estate market will continue sending out confusing signals (it always has and always will). Much of that issue lies within the myths and misperceptions perpetuated by uninformed ‘experts’ and those looking for attention.  You can see, in this article in Canadian Business magazine, that the “Market Crashers”have been wrong consistently for 6+ years, they name names and compare their predictions here: worth theread  Market Bears: Will They Ever be Right? 

This is the kinda of wrong info you are going to be hearing of throughout the summer.  That’s why Strategic Investors prepare in advance, we look at summer as a great buying opportunity (while others are out at the lake). But it takes Commitment. Commitment to taking strategic action regarding our real estate portfolios; commitment to being deliberate when interpreting confusing market signals and taking responsible action to insure that the risk is minimal and the positive outcome maximized.

We all know we aren’t capable of ‘changing’ the market, but a difference lies within the strategic investor. The strategic investor acknowledges this fact and makes subtle changes in their tactics in response to these imminent market shifts.

Most investors lack a critical skill in their tool belt – the ability to invest strategically. Instead of this being an afterthought, it’s time to shift the perceived importance of strategic investing to the forefront of our mindset. The best part of all is that major ‘life changes’ are not required to become strategic – all it takes is the devotion to being more deliberate in reading behind the headlines. Small adjustments can be made that will earn big results.

We all make choices every day, so choosing to be strategic shouldn’t be terribly difficult, right? Focus your mindset and get in touch with where you really are – the most honest representation of y our current situation, where you want to be and how you’re going to get there. If you can commit to this plan and see it through, you will ensure success. Your will and determination will be the only thing to push to that next level. The figure below gives you a sense of how all the pieces fit together and how much weight they carry for the strategic investor.

The Five Essential Elements of the Strategic Real Estate Investor

Let’s take a closer look at each level of the strategic investor pyramid:

Mindset: It is no surprise that mindset is the essential base element of the strategic investor pyramid. Mindset is the foundation for understanding real estate cycles, and strategic investors have a very distinct mindset: they think differently from other investors. They think strategically. This ability to weigh many options and outcomes and make informed decisions in their own best interests is what sets them apart from the rest of the pack.

Real Estate Cycle: Investors must know, study and understand how the Canadian Real Estate Cycle performs and how to read it. If they don’t, investment decisions could be based on market influencers rather than market drivers, which could be a dangerous oversight. Those who invest and analyze based on influencers often end up surrounded by chaos, emotions and a tough financial state. Those who invest based on the drivers are the investors who always come out ahead. Which person would you like to be?

Goals: Strategic investors are fully committed to themselves. They enroll in a set of realistic goals, taking into account the phases of the real estate cycle, their target market’s underlying economics and how much time and capital they realistically have to invest in the coming 12 months. Then they get on with the show and make things happen.

Strategy: From their commitment, strategic investors focus on the strategy that will keep them true to themselves and their overall goal. Strategic investors use only specific strategies to create and sustain wealth throughout the inevitable cycles of the real estate market. They analyze key drivers, and adjust their tactics to account for market influencers.

Tactics: The strategic investor does not confuse tactics and strategy. Strategy forms the master plan. Tactics are the steps you take and tools you use to achieve the goals in your master plan. You adjust your tactics as market cycles progress – you do not adjust your goal or your strategy.

This summer, you can have fun AND be strategic with a fully committed mindset as your foundation. Why not set yourself up to win rather than get drawn in the wrong direction? It all comes down to one person and one person alone – you.

If you are feeling a little stuck, it is time to STOP – stop spinning your wheels, stop procrastinating and stop making decisions based on headlines alone. This is your chance to dig deep and make success a priority. If you’ve ever wanted to as effective as possible and drive your business forward, you have an incredible opportunity coming up in just over two weeks.

If you are already well on the road to success, now is an excellent time to increase your level of strategy. Begin to use your momentum to fuel additional success. Speak of your knowledge, speak of your success, speak with confidence and doors will quickly begin to swing open.

Summer is  a great time for fun, family and friends.  However I have often found it to be a fantastic time to build my contacts and portfolio.

 

The 5 Essential Elements of the Strategic Real Estate Investor was last modified: June 23rd, 2014 by maddy
 

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