So, you set resolutions and goals for your real estate business last January, but maybe you didn’t achieve them all? Maybe your goals just weren’t realistic or specific enough. When I ask people, I usually hear things that are vague, like “I’m going to tear it up this year”, or unrealistic goals like, “I’m going to flip 5 houses a month!”. There’s still time left this year, so, what is realistic and doable?
Set “SMART” Goals.
Goals should be, SPECIFIC, MEASURABLE, ACTION-ORIENTED, REALISTIC, and with a TIMETABLE. Make sure all of your goals you set out this year meet these five important criteria.
Think first of where you want to be at the end of the year in your business. Then, work backward, breaking it down by quarter or month. For example, if you want $100k cash in the bank, then you may have to flip 4 houses for $25k net profit each, which means one every 3 months. In order to find a deal of that caliber, you may have to make 300 offers. That’s about 25 offers a week, or 5 a day on a five-day work week.
Think in Percentages
If you are already doing the business a while, then tripling things in a year is not likely going to happen. Aim for a reasonable percentage increase in things like deals found, profitability, and speed of rehab projects. If you can increase your marketing effectiveness 25% for finding deals, that will translate to more profit. If you can rehab a house for 20% less than last year, it would translate to more money in your pocket. You get the idea…
Assess Your Resources
What money, time, tools, experience, etc are you working with? Are there some assets (like that old muscle car project you never finished) that you can sell to generate cash for your business? Are there commitments for your time you can get out of to devote to real estate? Does your credit need fixing or improving? Take stock of what you have and what needs improvement.
What tools – physical (e.g. computers and software, a truck, hand tools) and mental (e.g., experience, education) – do you need to achieve each of your goals? Which ones are missing? Tally up a list of tools you need to acquire for your success. Work acquiring these tools into your SMART goals action plan.
Plan Your Week Carefully
People often lose track of time in their week for failure to plan carefully. Time is precious, so don’t waste a minute of it doing something that isn’t in furtherance of your goals. Ask yourself, “Will this help me buy another house?” Plan your day with self-appointments between appointments with others. For example, instead of a running “to do” list, enter tasks in your calendar at specific times so they read like appointments. It’s extremely effective to set aside time during your day to do various tasks, rather than check off a list without reference to the amount of time it takes to do each task.
Sharpen the Saw
In the famous book, “7 Habits of Highly Successful People”, a valuable principle is revealed: “Sharpen the Saw”. Abe Lincoln said, “Give me 6 hours to chop down a tree and I’ll spend 3 hours sharpening the axe.” Don’t overlook education as part of your formula for success. Real estate success is directly proportional to the amount of knowledge you have; the more knowledge, the fewer mistakes you make.
“Sharpening the Saw” means adding to your knowledge and abilities as a savvy real estate investor. One great way to success is to increase your knowledge of real estate. Protecting your hard-earned assets is also critical!
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Attorney William ("Bill") Bronchick, the host of Legalwiz.com, has authored six best-selling books and is sought nationwide for his 30+ years of real estate and legal knowledge. He has been interviewed by numerous media outlets, such as CNBC, TIME Magazine, USA Today, Investor Business Daily, Forbes, and the LA Times, to name a few. William Bronchick is the co-founder and past President of the Colorado Association of Real Estate Investors and the President of the Colorado Landlords Association. Click on the "About" link above for more information on William Bronchick.