Posted by LandVestor on February 16, 2006 at 11:50:22:
You certainly have a point. When I was a kid I thought money was the thing in life that really mattered the most. Once I made it, it was a lot different than I thought it would be. (And a lot bigger headache!) Luxury cars are great, but they really just get you to the same place as any Toyota would. I guess it’s just mostly in the mind. Hey, those hot babes were probably worth it after all! 
What are the odds of RE success? - Posted by gerald(tx)
Posted by gerald(tx) on February 13, 2006 at 01:53:56:
I’m a numbers kind of guy, so when I heard RA’s infommercial claim 1 million students, I remember CS making the same claim. Heck, I think, if all the other gurus combined make up another million that would be 3 million of us who have bought a RE course.
Since the US population is roughly 300 million, that would mean 1 of every 100 man, woman, or child has had aspirations of being a real estate investor, enough to sink good money into a course.
Going further, my urban metroplex area is 5 million. That would seem that there were roughly 50,000 courses sold if the 1/100 ratio is valid. If there was a 100% success rate, we would have 50,000 successful RE investors.
When I go to our largest RE club meetings, there are roughly 300 there if a great program is advertised. A show of hands of first time attendees is asked. About 1/3 hold up their hands. At this rate, the membership should be doubling every couple of months. It hasn’t. It the same as three years ago. Just a different bunch of faces coming and going, with perhaps two or three dozen of the stalwart old timers.
You can draw your own conclusions. This does not go into the motivation, abilities, persistance, or other qualities that eventually determine success. Nor is intended to comment on, justify or negate those qualities. It is simply a realistic look at the numbers.
gerald
Re: What are the odds of RE success? - Posted by Ed Garcia
Posted by Ed Garcia on February 15, 2006 at 12:15:14:
Gerald(tx)
There is an old saying, ?Figures don?t lie, but Liars can figure? I agreed with you the numbers don?t match up.
To answer your title, ?What are the odds of RE success??
The odds are completely in the hands of the practitioner. No matter your market, or your experience, if you don?t put what you know into action its conversation.
I know guys who have knowledge and experience who sit around and complain that they can?t get the job done because of the market.
As Johann Von Goethe once said, “Knowing is not enough; we must apply. Willing is not enough; we must do.”
Ed Garcia
Re: What are the odds of RE success? - Posted by Rob FL
Posted by Rob FL on February 14, 2006 at 09:38:27:
Sure there are millions of students, if you define a student as anyone who bought one of their books, courses, or seminars. Just being a student doesn’t mean you will do anything.
The ones who succeed in real estate (or any other buisness) are the ones who get educated, create and refine a business plan, work their tail off, and persistentnly keep at it.
Probably 99% of the people who want to do real estate do not succeed. Most just think it is a get rich quick scheme and therefore give up when they find out it isn’t as easy as TV makes it out to be. The 1% or so who do succeed worked hard for years to finally achieve real success.
Odds… - Posted by Sean
Posted by Sean on February 13, 2006 at 14:03:35:
The average life expectancy of a person wanting to be an REI is maybe 12-18 months… most will never buy a single property in that time… the overwhelming majority will flush out inside of 3 years, because that’s when all those funny money games you can play with RE come home to roost… you know things like assuming payments on large pretty houses, and then L/O to others…only to learn too late that most of those deals fall apart, and you can no longer bring in enough deals to keep the pyramid from collapsing etc etc…
If you last more than 3 decent active years, you are generally over the hard parts, from what the old timers tell me… But like anything there is a learning curve, it takes years to get good at something… so look at REI like any other business…
Its going to take you time most likely to get competent at it, you are going to make mistakes… and its toing to take you even longer to get good at it… and even longer to get EXCELLENT at it. Most of the “BIG” guys I know have been doing it well over 10 years, and it really didn’t kick in as huge cashflow businesses for them until right around the 10 year mark on average.
There are obviously exceptions to this rule, but it does seem to be fairly consistent.
There are 2 REI groups in my town… one mostly attracts newbies and flippers… its a large group, and been growing like crazy under the latest fad… about 75 brand new visitors every month… over 1000 members total… but well under that number are truly seriously active folks. I’d say the core of who’s really doing deals consistently is 100-200 maybe, and those doing more than a deal a quarter you are under that.
The other group attracts more of the buy and holder landlord types… its smaller, and has a different focus… its definately more focused on the boring nuts and bolts… while the other group is more about the sizzle. Both are useful, and good information
I am sure that the Guru’s sell lots of books and tapes,but books and tapes do not equal actual action. I can point out many people who come to every monthly meeting of the RE groups, and have for years before I even started that have NEVER bought a property, but have 50k or more in educational materials…
Everyone can dream… not everyone can or will do.
Odds of RE success? You can make MILLIONS, if - Posted by LandVestor
Posted by LandVestor on February 13, 2006 at 11:59:51:
You start small and learn every step of the way, you study your local and regional markets carefully, you stay on top of national trends, you maintain good credit, and you accept the fact that Rome wasn’t built in a day and skyscrapers go up one brick at a time. It took me almost 10 years to really start making some serious money in the real estate game.
Success is not Luck - Posted by Jimmy
Posted by Jimmy on February 13, 2006 at 09:18:02:
Success can be achieved by anyone. But it takes time. You will make mistakes. Your first deal is much more likely to be a loser than will be your 10th deal. There is a steep learning curve here. There is a LOT to know. not insurmountable, but intimidating at first. Immerse yourself in the business, watch the movers and shakers in your area. Never take advise from unsuccessful morons. Never take advise from people less successful than yourself.
I never took any seminars. Maybe I should have. I am very untrusting of gurus. Maybe I would have avoided some mistakes. But experiencing mistakes and seeing real money (MY money!) in play is the best teacher of all.
One of the most important things to learn is CASH MANAGEMENT. Fail to do so, and you will be out of the business. You will become one of the “distressed sellers” we all love to find.
Re: What are the odds of RE success? - Posted by Frank Chin
Posted by Frank Chin on February 13, 2006 at 08:08:48:
Gerald:
Being a numbers guy, here’s what I see:
Unfortunately, courses teach techniques, but not the when, the where’s the why’s, nor take into account personality.
Reminds me of something that happened the other week at the office.
I taught an employee a simple matter of how to call a bank to get some information. I sat him down and have him listen to me make the call, and he took good notes.
A few days later, he was all distressed, and said he followed the notes to the letter, called the same number, read off the exact same script, but got a “we don’t know what you’re talking about”. He when on and on ranting about how rude and stupid people are.
After listening to his rant, I pointed out to him that this is another problem when he actaully has to call another place, with a different script. So he dutifully took copious note of this call, and the script.
But ONE BIG problem.
He can’t tell one problem from the next, and would need help to point out to him which one to call. And if there’s any variation from the script, he’s stuck.
This guy was thinking about buying one of these RE courses, and I wonder how successful he would be applying the techniques.
And the funniest thing was, he speaks with an accent that is sometimes hard to make out. His famous reply to this is “do you speak English”??
What is wonderful way to start a conversation with a propect doing a flip, don’t you think??
I’m sure he’ll be bringing the course back for a refund since it doesn’t work.
Frank Chin
Re: What are the odds of RE success? - Posted by arlanj
Posted by arlanj on February 13, 2006 at 07:56:45:
I bought 1 book, $19.95(“BUy it, Fix It, Sell It”), after I bought my first 3 rental houses. I now have bought over 20. Some for rehab, some for sale, some for rentals. It is not rocket science. Buy a house at a good distressed price. Clean it, fix it, sell or rent it. Make some $. It is as simple as that.
Re: What are the odds of RE success? - Posted by David Krulac
Posted by David Krulac on February 13, 2006 at 06:04:03:
I went to a large cre convention recently with 1500 attendees. About 1/3 did not own any re, and about 1/3 only owned their own home.
there is a large turn over in cre. even on this board almost all the people who posted here in 1998 are gone for one reason or another. even looking back 2-3 years most of the posters are new. people get into cre with high expectations, sometimes unrealistic. they get bored, an discouraged and get out of re.
at our local club enrollment is also constant and ther are new people every month. people come and people go and there are always new people. that’s no necessairly bad as there are new ideas brought in too.
A second observation - Posted by gerald(tx)
Posted by gerald(tx) on February 13, 2006 at 02:15:26:
There is no denying that the boom in RE prices has made a lot of people rich. Were these for the most part, people who bought courses from the gurus, or just people who could see the trend coming and hopped on?
For that matter, there was probably a lot more money made accidentally in real estate, (just by happening to be owners during appreciation period) than all the investors,(course buyers or not) put together.
gerald
Re: Odds of RE success? - Posted by Pat
Posted by Pat on February 13, 2006 at 13:05:09:
Knowing what you know now LandVestor, is there anything you would have done differently in these past 10 years?
Thanks!
Pat
And they will upsell him. - Posted by John Behle
Posted by John Behle on February 13, 2006 at 15:36:16:
When (or if) he calls to return the course, he is as likely to buy another product or the advanced service or seminar as to get a refund. Some buy the course because they are promised it is all they will need and then the next thing they know, they are buying a bigger course from the same people because they have been convinced that the basic course is “not enough.”
It’s just human nature. There are dreamers and there are doers.
% of successful seminar grads - Posted by Mike-OH
Posted by Mike-OH on February 13, 2006 at 06:24:24:
I went to a REIA conference last year. All of the speakers were selling courses. One of the speakers was offering to re-imburse the entire cost of their course to anyone that actually did a deal within 90 days!!! That speaks volumes to me. The speaker was well aware that the vast majority of attendees who bought her course will not do a deal.
Mike
Re: Odds of RE success? - Posted by LandVestor
Posted by LandVestor on February 14, 2006 at 23:36:04:
Well for one, I would have not wasted so much money on luxury cars and hot babes! If I’d have put all of that extra “fun” capital into real estate, my net worth would probably be close to double what it is now.
Re: Odds of RE success? - Posted by george
Posted by george on February 13, 2006 at 13:59:18:
I can tell what I would have done differently. I wasted a whole decade mailing out postcards, planting bandit signs, etc, winding up rehabbing a few junker rentals that the tenants could tear them up faster than I could fix them up.
When I moved up to a higher class of properties with a higher class of tenants, things changed for the better. Real estate is now working the way it should, and I’m now making good money at it.
george
Blank tapes with no response - Posted by John Behle
Posted by John Behle on February 13, 2006 at 15:29:47:
John Beck, Hal Morris and a couple others of us were chatting in a break room at a conference we were speaking at. The discussion turned to “how many people use the materials the buy at conventions?” We speculated, but Hal Morris chipped in with a real example.
He said he had a large number of sales at another convention he spoke at. A few days later he got a frantic call from the company that produced his tapes. They said there had been an error and of the 6 tape set, only the first side of tape one and back side ot tape six had been recorded. Everything else in-between was blank.
Hal stated that he was able to get the tapes replaced before anyone noticed or complained. So??? How many people apply what they are given? Many people buying courses are dreamers not ready or willing to follow through.
Ed Beckly used to sell 15000 of his courses per week long before anyone had ever heard of Sheets. What I found interesting is he had several hundred people manning the phones just to handle buyer’s remorse refund requests. “Billy Bob” is up at 3:00am depressed over his life. He buys the magical course that is going to change his life. Next morning his wife clobbers him and he calls for a refund. Some don’t even get so far as to receive the course before they give up.
That isn’t a condemnation of real estate, but just the fact that you could give everyone in the United States a copy of a good course and it might make little difference. Only those ready, willing and able will do anything with it. Some will even buy multiple courses and do nothing. Some will come out to REI groups for years and hear every speaker (and ask the same questions) and do nothing.
Then others jump in and succeed without even having a course to guide them. We had a meeting one day and two people there stood out to me. “Craig” had every real estate course that existed at the time - or at least copies of them. He would be one that had to park his car out on the street because his garage was full - except he had no garage. At over 40, he lived with his parents in their condo. He had NEVER bought a piece of real estate. As an agent, I don’t think he had ever even sold a piece of real estate. He told me one day he’d had an offer and was going to go out on the seminar circuit to promote courses for Gary Cochrane.
The other person was late for the meeting. He had to stop to buy a motel that he saw as he was driving by it. He’d never had any kind of real estate course.
One had guts and the other had fears. One jumped in without too much thought about the future. He just loved making deals. The other had so many fears he was paralysed. “Paralysis of Analysis”. He was so afraid of losing, he was not about to step on the field. He was so afraid of losing money, he was not about to take the risk - and drove away in his rust bucket truck that was missing two gears. He was also so afraid of marriage that in his 50’s he is still single. He’s fortunate he doesn’t have to worry about getting a divorce or getting dumped. I’m sure he’s writing a book about marriage and raising kids - because that is how it goes. Last I heard he was going into social work.
Education is worthless without guts. Drive is as important as direction. Belief is more powerful than billions.
If you work at it, you will succeed - Posted by Handy
Posted by Handy on February 13, 2006 at 07:23:40:
Come people, this question is like saying “What are the odds that a small business I start will succeed?” They depend on you. Gurus make it sound easy, but like everything else worth doing well, it’s not. If it was, everyone would be doing deals, and the market would have pushed the profit to zero (or, gasp, outsourced the whole process).
Occasionally a great deal will drop into your lap–I bought a 3 BR house complete with paying tenant the other day at a tax sale for $175–but if you’re not working the system, and looking where you should be looking, it will never happen. No guru’s course, no matter how good or well promoted, will roll up your sleeves and do the work for you. And there’s no such thing as a free lunch.
Re: Odds of RE success? - Posted by Don (VA)
Posted by Don (VA) on February 15, 2006 at 10:41:22:
On the other hand, there’s something to be said for hot babes. It’s said that people far more often regret the things they didn’t do than the things they did. As a card-carrying member of AARP, that’s true. Yeah, I wish I’d bought that townhouse in downtown DC from an investor back in 1970…or a duplex in Falls Church for $139,000 that’s now worth $800,000. But I also wish I’d spent a bit more time having fun.
Re: Odds of RE success? - Posted by CR
Posted by CR on February 14, 2006 at 24:19:04:
What is “higher class” to you?