The 6 Timeless Principles Every Successful Real Estate Investor Follows

SPONSORED CONTENT: Referral Network Realty

Referral Network Realty is extremely grateful to have been partnered with Keyspire for over a decade. Being solely focused on helping investors grow their real estate property portfolios gives us a unique perspective on what works and what doesn’t. The economy, interest rates, and political climate are major forces that are always changing and threatening our business as real estate investors. Every real estate market, time in history, and individual investor is also unique. Today is no different. Fortunately, we’ve seen it all — or at least enough to recognize some basic success principles. I’ve extracted these principles from our journey and thought it would be valuable to share the common traits — the six principles — that our most successful investors follow.

Principle 1: Take Action

This principle comes first for a reason. We have helped and watched tens of thousands of people just like you, and the successful ones — without a doubt — all have this one thing in common: they did something. “Paralysis by analysis” isn’t just a catchy phrase. It’s a human trait designed to keep you safe. Unfortunately, it also keeps you in your comfort zone and away from growth.

Growth is uncomfortable, and going through something for the first time is scary. No one wants to fail. However, failure is actually part of your growth. With the right perspective, taking action will always have a positive outcome, even if you don’t hit a home run.

Staying with the sports analogy, the Great One, Wayne Gretzky, has a famous quote: “You miss 100% of the shots you don’t take.” Taking action — thoughtful, calculated action — is the only way to improve your knowledge base, gain experience, and move toward your financial goals. Successful investors make more mistakes, and failure only sets in if you give up. This does, however, have to be paired with our next principles to ensure failure isn’t a setback, but rather a learning experience that propels you forward.

Principle 2: Take Advice From Those Who Have Done It

Everyone loves to give advice, and I believe it usually comes from a good place. Unfortunately, the opinions of others often come from their own insecurities. We are fortunate to be surrounded by abundant thinkers, but don’t be surprised when someone close to you has a pessimistic view of the goals and ambitions you share.

If you wanted to get in shape, you would take advice from someone who is healthy and has a body, energy, and lifestyle that you aspire to emulate. The same applies here! Our RNR investment Realtors for example, have worked with countless investors — and they are investors themselves. They’ve done it. Michael and Scott have done it. So when we pair this with Keyspire’s education and advice, you are listening to the right people.

Collectively, we have made more mistakes than you ever could on your own. On the positive side, the professionals in the Keyspire community all have success stories that you can draw on and replicate. Don’t be afraid to ask someone what their experience level is before taking their advice. Unlike fitness, it’s not something you can recognize just by looking at them.

Principle 3: Buy Below Your Means

One negative commonality within the investors we’ve worked with over the past few decades is the tendency to push investment capacity to the max. This is another human trait that must be managed. When your mortgage pre-approval comes back and says you can purchase up to $800,000 with 20% down, it’s natural to start looking at that price point. The successful investors fight this urge and find confidence and security in looking below that number.

No one has ever gotten into trouble from the asset side of their balance sheet — only the liability side. We make our money when we buy, and being able to weather a storm of higher interest rates, decreased rents, unexpected maintenance, or other unknowns is part of the game. Remember, there’s risk in everything, and real estate investing is always a get-rich-slow strategy.

A second benefit of buying below your means is that it leaves room to plan for your next move. Diversification, even within real estate, has to be part of your long-term plan. If you are just starting out, acquiring your first income property won’t allow you to diversify yet — but your road map should at least include a plan for your next investment. Diversification can be geographic, property type, ownership structure, passive vs. active, and more. As you take action and grow, your plan will evolve too. But always stay below your means so you don’t get stuck and can keep moving forward.

Principle 4: Follow Your Gut

Your journey is unique. What worked for one investor may not work for you. Try this exercise: think of the difficult times in your life that led you to make a change — a divorce, career shift, overcoming addictive habits, or something else. Now think back to before the change. Did you already know? Hindsight is 20/20, but most of us realize there was a point when we felt — or knew — that something was wrong and needed to change.

That instinct is a superpower we all have and need to learn to trust earlier. When we hear investors speak about a potential investment, we listen for a confidence that they can see the project from beginning to end. That doesn’t mean you know all the steps, but it should feel clear and simple to you. Your gut knows it.

This may sound contradictory to growth being uncomfortable, but it’s not. The difference is in the energy. When you’re in alignment, challenges feel exciting rather than terrifying. Trust your gut and learn to recognize when you’re in the flow of the universe — and, more importantly, when you’re not.

Principle 5: Use an Investor-Focused Realtor

Not all Realtors are created equal. Many of the issues we see come from investors purchasing property with Realtors who aren’t focused on investment real estate. Through no fault of their own, most Realtors are salespeople who excel at selling homes, but they aren’t trained to think like long-term investors.

The principles ingrained in Keyspire and RNR’s investor-focused Realtors are unique in the industry. Our goal is to help you grow your portfolio, which means every investment must stand on its own and set you up for the next one. Gone are the days of buying any home, in any market, and having it cash flow with 20% down.

Our Realtors are trained to keep you safe and advise against a purchase if the 4 Ways-to-Win pro forma isn’t sound or if the property doesn’t fit your unique growth strategy.

Principle 6: Have a Strategic Plan

I love the saying: “Begin with the end in mind.” Similar to Principle 4: Follow Your Gut, your plan will be unique to you. Not everyone is built to be Michael and Scott, who can take on a property renovation in their sleep. That said, you do have unique skills that are assets and will shape the investments we add to your portfolio. Each property must be part of your plan — one that leads toward the ultimate goal of financial freedom.

Your plan should feel big but exciting. We can be ambitious without stepping into managing a real estate portfolio we grow to regret. I’d say this is RNR’s real superpower: connecting you with top investor-focused Realtors is the simple part, but developing your personal growth strategy is the blueprint that ensures you’re working toward your goals the right way. Remember — it should always feel exciting and fun, even as you stretch your comfort zone!

Closing

Our long-standing commitment to Keyspire — and to you — is that we are always here to get you started or to do a portfolio analysis to strategize on your next investment.

Reach out to book a strategy call anytime. Remember the first principle? Lol. Let’s TAKE ACTION together!

Feeling grateful,

Aaron Rook
Investor. Owner & CEO of Referral Network Realty Inc.

www.referralnetworkrealty.com/investor-connect/