No matter what strategy in real estate investing

No Matter What Strategy..

I call this the "No matter what" strategy. It truly is a comprehensive strategy because if you buy a property with the intention of renting it out and you find that you can't make money despite your best intentions, you move on to "Plan B". If your alternative falls apart, you go to "Plan C".

The "No matter what" concept doesn't say that you don't have a preferred strategy or method of attack. What it does say, however, is that no matter what you do, there are a dozen different ways you can make money on a real estate investment. If each plan falls apart despite your best efforts, you don't miss a step because you always have another move you can make.

Because you have so many effective strategies available to you, you're never going to get caught in public with your pants around your ankles looking for a graceful way of exiting stage left. If every single strategy turns out being a loser, you can smile, shrug your shoulders, and sell your property. Even then, you'll make money because it is a contingency for which you have planned - even if the specific situation is a surprise.

That's the raw real estate power of being a "No matter what" investor.

Because you go into every investment with a solid game plan and an exit strategy you'll never have to worry about where your blood pressure pills are. You'll have the flexibility of knowing that sleep will come easily to you each night because the question of what you'll do if a specific strategy fails will have already been answered.

The No Matter What Strategy Defined

If you want to avoid making mistakes you need to have more than one option available to you. One specific strategy will help you make money no matter what you do. The way you make it happen is by redefining what you think of as a good deal.

If you pay retail or near-retail prices for property you limit your options. For instance, if you pay 90%-95% of retail for a property you intend to rent out, you limit your options. You may have every intention of putting a renter in the property and holding it for 5-10 years. "What if..." real estate investing strategies say that it will work if all the trains are running on schedule.

There's no room for error, deviation, or any of the other life situations that can derail your ideal investment opportunity. But, when you buy property with the "No matter what" mindset, you'll make money regardless of what happens. You can still make money when every possible investing strategy fails. While highly unlikely, you should plan for every possible contingency to cover your assets and guarantee that making money is still in the cards.

If you recall the example I gave you of John, the novice investor who bought a property near his home, he was able to turn a small profit by doing his own property management and handling all of his own maintenance. While he made more than one mistake along the way, the biggest mistake he made was in the price he paid for the property.

If he had been able to pay less for the property he would have opened up a world of opportunity for himself. When he made the initial discovery that he couldn't turn a profit on his investment without doing his own maintenance and management, he could have implemented another strategy that would have allowed him to make money.

Then, later on, when he was notified by his employer that he would have to pull up his roots and relocate to Portland, Oregon, he wouldn't have been left with the terrible choice between staying with a property that was just barely profitable or transferring out of state. He could have just switched gears and moved on to another strategy that would still keep him in the black.

Finally, when the mother of all financial insults took place and he discovered that his too-good-to-be-true tenant had badly damaged the property, he had no good alternatives available to him. All he could do at that point was try to scrape together a monthly payment and tread water financially on a month-to-month basis with a property that was generating no income.

Had he had more options he could have done something about it.

The "No matter what" strategy would have covered his backside. He could have quickly sold the property for what he could on the open market, put the property behind him, and still put money in his pocket when it sold.

The way he could have done that is by controlling how much he paid for the property when he bought it. If you can buy a property cheap enough, you'll make money regardless of what happens. You have the peace of mind of knowing that a hundred different things can simultaneously go wrong with your property, your tenant, or your strategy, and there will always be another weapon in your arsenal that will make it possible for you to make money.

The real estate market has fallen apart in many parts of the country. Strategies that worked well when values were rapidly rising are no longer possible. Instead of lamenting what might have been, you could simply move on to something that will work given the current market conditions.

Buy your property cheaply enough to make money and you can use whatever strategy that will work in order to make money instead of playing "What if..." and hoping for the best. It's a huge mistake to do otherwise.

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Peter Vekselman-Your Real Estate Coach for Life

www.coachingbypeter.com