EP234: 3 Biggest Mistakes Real Estate Investors Make – And How To Avoid Them!

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Did you know that three mistakes could be holding you back from millions…?  Yep, you heard us right. There are some seriously amazing, wealth-building opportunities in the world of real estate investing, but it’s so easy to get caught in the common pitfalls that stop investors dead in their tracks! 

That’s why we’re sharing the top three mistakes real estate entrepreneurs, general partners, and capital raisers make and how to avoid them yourself! 

When you know what roadblocks to avoid, you can confidently scale your investment strategies and start growing wealth that lasts for generations to come!

Let’s get to it. 

Think about the most successful athletes in sports today. Someone like Brady, James, or Ronaldo is literally at the top of their respective game, right? Now, imagine one of them deciding to put all of their competitive juices, training, and skills into another sport.  

Do you think they would excel as much in any other sport as they do in their chosen fields? It might be fun to watch them try, but the answer is no – they couldn’t possibly give the same focus and effort into multiple sports and STILL be the greatest in the one they’ve been working at their entire lives. 

Niching down is what allows them to be not just good, but the best at what they do!  And you know what? Niching down can do the same for real estate investors, too.

We’ve seen the fear of niching down play out time and time again with General Partners and Capital Raisers.  They get scared to commit to a certain niche, thinking they’re leaving themselves open for more opportunities. 

In reality, though? 

They’re actually closing off opportunities and holding themselves back by not niching down! And in this case, holding themselves back means leaving money on the table… lots and lots of money. 

You know the phrase, “You can’t please everyone?” Well, it’s absolutely true. We’d even go as far to say that if you want to please everyone, you won’t please anyone, and that’s what it’s like to try and raise investment capital without sticking to your niche. 

Being too broad means you can’t narrow in on the problem you’re trying to solve for people. But, when you know exactly who you want to help, you can uncover what they need, and offer solutions to their unique problems. 

And listen. This goes for ANY type of business – tailoring your language and efforts towards your ideal audience and their needs will help you grow your business like crazy. 

We can think of tons of examples of businesses doing this successfully, but let’s look at some of the most recognizable ones…

Apple is dedicated to serving creative professionals who want easy-to-use, convenient technology products that enhance their lives and work. Apple’s ability to tune into a specific audience is what majorly separates it from other technology companies. 

Another name you might recognize is Tesla – the brand that concentrates on electric cars and renewable energy, which appeals to car enthusiasts who also care about the planet.

And of course, we have to mention Amazon – which started as an online bookstore, but has since become a leader in e-commerce by creating a simple, fast, convenient online shopping experience like no other. 

Not convinced that niching down is the way to go, yet? Here are some of the main benefits…

By focusing on a specific audience, pain points, and solutions, you will attract a dedicated, loyal audience, stand out from competitors, and establish a distinctive brand identity and reputation. 

All good things, right?

GPs who niche down will raise MORE money while securing loyal investors who keep coming back again and again! We’ve seen it, we’ve experienced it, and we’ll never stop sharing it. 

Don’t be afraid to niche down and go all in on your audience. 

Now for the next common mistake holding investors back from millions.

To illustrate this one, let’s use the example of someone managing their personal finances… we’ll call this person Rosie. 

Rosie just got a brand new credit card, and has been spending like crazy, but hasn’t been tracking her expenses at all. It’s not hard to imagine the type of trouble she’s going to run into in this story, right? 

Rosie isn’t tracking her purchases, saving receipts, or considering her budget while spending her money, so when the credit card statement comes, she’s shocked at what she sees!

To think, if she would’ve simply tracked her expenses and kept tabs on her finances, she could’ve made educated decisions about spending her money wisely.

What can we learn from Rosie’s story? That failing to track your numbers can seriously hold you back from your goals. And yes, this definitely goes for real estate investing too. 

You see, in the world of real estate, the numbers we’re talking about are the metrics used to track things like leads and conversion rates. 

Without understanding your metrics and how to interpret them, you won’t be able to know what’s working and what’s not, and you can’t adjust your strategies accordingly.  

It’s like going on a weight loss journey. A person may have goals of where they want to get, but those won’t do them any good if they don’t know where they’re starting and how they’re progressing without those weekly weigh-ins. 

Scaling your real estate business requires having clear, measurable targets to keep you moving in the right direction.

Here are a few tips to help you start tracking your KPIs, so you can get the most success out of your investment strategies:

First, get clear on your investment goals and objectives.

Then, identify the relevant, most important KPIs for your specific goals, like occupancy rates, cash flow, net operating income (NOI), etc. Your KPIs will depend on your chosen investment strategy. 

Once you’re clear on goals and  KPIs, set attainable benchmarks for each KPI, that will help you keep tabs on your progress along the way. 

You’ll want to regularly check, assess, and evaluate the benchmarks you’ve set. We recommend setting a reminder for yourself, maybe monthly or quarterly, and then make necessary adjustments as you go. 

It might not sound glamorous or exciting to talk about numbers and KPIs, but trust us. There’s nothing more sexy than data-based decision-making, because it can lead you towards your biggest financial goals!  

Now, let’s move on to our final real estate investing mistake today… It’s a big one. 

Imagine jumping into an investment deal just because it promises quick cash returns, and short-term gains. 

But after diving in, you realize that it’s actually a bad deal, and now you’re stuck with more stress and wasted time, and your money is tied up in something that won’t help you progress towards your financial goals. 

Choosing a bad deal for a quick payout is never the answer, and choosing short-term gains over long-term success is what can seriously hold investors back from wealth.

The issue is choosing instant ROI instead of legacy ROI, which happens when investors want to get fast results from their investments, without focusing on the long-term plan for lasting wealth and success. 

Legacy ROI is much more beneficial than instant ROI, and is about more than just the money involved. 

You see, building a respected brand reputation that lasts is more impactful to your future. It can transform a business completely, while also building trust and strengthening relationships along the way. 

So, let us ask you… 

Do you want to just get rich? OR do you want to grow the type of wealth and reputation that outlives you, and passes down for generations to come? 

That second option is possible, friends, and getting there starts with small, intentional actions that lead to long-term, life-changing results.

Our favorite way to boost your legacy ROI and grow long-term wealth is multifamily apartment investing! 

Multifamily offers real estate investors low-risk, stable investment assets that meet the basic need of housing, which means it will STAY in high demand for the foreseeable future. 

Now that you’ve learned the 3 biggest mistakes real estate entrepreneurs, general partner, and capital raisers make, be sure to check out this episode…