SEATTLE AVENUE

POOR WILBUR

Nardo was a great real estate agent. He made a great living with less than ten clients. Nardo’s specialty was finding opportunities. I was one of his clients and so was a local school bus driver by the name of Wilbur. When a new deal would come along, Nardo would call me with, “Listen, I’ll give you a day to think about this and then I’m calling Wilbur”. Wilbur would buy any property that Nardo told him to buy if Nardo could put the deal together. All told, Nardo sold Wilbur five properties.

I liked Wilbur, but, to be kind, Wilbur wasn’t too bright. Wilbur wasn’t very good at keeping his properties up and he wasn’t very good at collecting rents. For years, Wilbur had a six-family house with only two units rented because he didn’t want trouble from more people. Wilbur just managed to collect enough money to pay off his mortgages and pay the taxes on his properties. Wilbur lived in a run down house. He drove a junk car. Those properties were a burden to him. Yet, over the two decades that Wilbur owned his properties, he became a millionaire. He should have driven around town in a Cadillac. He should have gone to Hawaii. He didn’t. Wilbur did one thing right. He bought real estate. Now with Wilbur gone, Wilbur’s children will drive the Cadillacs and visit Maui.

Master’s Tip: Money alone won’t make you happy. There are many wealthy people who are miserable. Committing to self-improvement and service will make you happy.

Marketing Real Estate

You are going to learn most of what you need to know about marketing through observation. Knowledge is power. Knowledge is your advantage. You are going to study the real estate ads. You are going to go to open houses and see all that you can. You are going to keep a continuing dialogue open with Nardo and with other agents and other investors. You will see how they market real estate. You will learn. You will try to be equal to or greater than their best.

Master’s Tip: You can’t find all you need to know by taking this course, reading a book or surfing the Internet, you’ve got to get out into the field. This is your job to research your investment area. You’ve got to see the different types of properties in all price ranges. You’ve got to speak with sellers and agents and tenants and lenders and local officials and other agents. And speaking really means to do a lot of listening.

Your Nardo may be a great marketing agent and you may let him handle everything. Or, you may purchase a property with a buyer already in mind. As you talk with other investors, you will know which ones are buying different types of property. You can buy and resell to them. Or, you may find first-time buyers who are having difficulty getting into the market. You buy a property and add in your profit and then sell to them on affordable terms. This is not taking advantage of people. This is business. Over the years to come, the young couple that buys a property from you is going to be much better off than the young couple that just keeps paying rent to you every month.

Master’s Tip: If Nardo is your man, fine, but even Nardo should be willing to give you a complete marketing plan. If not, find someone else. Who are the targeted buyers and how does the agent intend to reach them? Don’t be afraid to ask for specifics. Who will write the ads? Where will the ads be placed? What will be the frequency of advertising? How will the agent split the commission with cooperating brokers?

Master’s Tip: Some brokers do not like to share their listings with other agents and other offices. They want to sell the properties themselves. Be aware that if your listing agent is cooperating with other offices, the commission split is 50/50. If the commission split is less than 50/50, other brokers may not be interested in showing your property to their prospective buyers.