In a market where you read conflicting news about the real estate investment market almost daily, the first and most important thing to remember is DON’T PANIC. Have the courage to fight the short term battle in order to win over the long haul.
Real estate by its very nature is a long term investment. While there are ways to earn income over a short period of time, the greatest wealth building that utilizes real estate as an investment takes time. The compounding of values adds up to a staggering amount if you’ll have the patience to wait a few years. Buying and selling based on short market movements is akin to investors who watch the ticker tape and sell as soon as a stock price looses a little ground. Odd lot buyers (small time investors who buy less than 100 shares of a stock at a time) are notorious for making bad purchase and sales decisions. They seem to watch a stock grow in value until they are finally convinced it will keep going up forever; then they buy. Unfortunately for them, this occurs typically at or near the top of the bell curve and soon the stock starts to slide. When that happens, they panic and sell. They seem to forget that all stocks go up and down in value during differing periods of time, but over the long haul the good ones always go up. Interestingly, there are successful stock speculators who do nothing more that watch the odd lot numbers and then do exactly the opposite. Just think what you could have achieved if you had watched all the small time “get-rich-quick” buyers and then done exactly the opposite. Wow … you would have made a bundle. Therein is the difference between the unprofessional and amature speculator, and the seasoned professional. I did not lose one red cent in the great market downturn! I’m sorry if you did.
Like it or not, to maximize your return in real estate, you will need to weather some storms. This is yet another good reason for buying right in the first place. If you are stretched so tight that you cannot make it through the lean times and are forced to sell, you may never see the fat times full of profit.
The trick, if there is a trick, is to do your homework before you buy. It is far better than being taught a lesson by the marketplace. When you buy, expect some good and some bad, because you’ll have both. Be patient and give the market time to rebound from any corrections and you will benefit greatly. Real estate is the basis for all wealth. Get your share and then let it do its thing over a long enough period that it will meet your goals. Wealth building is most successful with an intelligent mind, a patient attitude and a pocket book deep enough to smooth out the rough spots on the road to success. Good luck in your career, and remember, no matter what happens, don’t panic.