Each of us has different personality quirks, different attributes, different talents, and different family and financial resources. It's easy to try to emulate inspirational people, but it usually doesn't work out because of these differences. A more rational course would be to take the time to really analyze what it is that you like to do and can do, or could learn to do.
Some people like to manage other people, and assets-, making all the decisions and living by the results. Others prefer the relative tranquility of the financial arena, spending their effort borrowing and lending money. Still others are happiest buying derelict houses and turning them into cash flow rentals, or selling them to earn quick cash profits.
Hundreds of thousands of people serve as middlemen brokers, bringing buyers and sellers together, and/or arranging loans to enable them to buy and sell houses. All of these vocations can be very profitable if you take the time to study them, and to become good at them.
There's a much greater chance you'll succeed financially if you focus on what you like to do, where, when, and how you like to do it, rather than merely doing what appears to make the most money. When you do things you don't like to do just to make money, you'll rarely succeed; primarily because you'll be competing with those who like what they are doing. In almost every case, they'll do it better.
So, what might we do if we can see that we're going into a deflationary scenario?
A. Convert real estate into well secured Notes and Leases to lock in the old yields before they fall.
B. Sell assets for cash and retain it to use to buy in after prices have dropped.
C. Buy with variable rate loans which allow payments to drop to match failing rents.
D. Refinance and try to stretch out loans to give you more cash flow.
E. Sell Options to tenants to increase cash flow and to hold them as paying renters and to lock in higher prices while pulling some cash out tax-free.
F. Buy first mortgages in the market at high discount rates before capitalization rates fall and their price goes up.
G. Do the same with fixed rate, well secured leases. Start negotiating with lenders to use your cash to buy their foreclosed properties once they start taking them back.
No matter which facet of real estate you choose as your niche, by acting as a principal in transactions, you will be exposed to opportunities that are many and varied. Regardless what road you decide to take to the realm of the rich and famous, you'll quickly learn that real estate involves many synergies and that you'll be doing a little of everything. Land developers need builders, and builders need land. They both need financing, and the lenders who will provide it.
We live in a synergistic world. Banks need appraisers, and vice versa. Brokers need buyers and sellers, who also need brokers. Financiers need consumers of long term mortgage credit that are provided by salespeople who sell product provided by home sellers, who will use the money to purchase new replacement houses from builders. They all need attorneys, bookkeepers, and accountants; and the beat goes on. So, although you may be making money in one discipline, you can invest in others. In the process, you may be helping yourself along your personal road to success.
From Jack Miller's New CREATING WEALTH WITH HOUSES e-manual
