“What do you think separates successful real estate investors from those who give up, fail, or never get started?”
Brandon Turner asks this question each week to guests on the BiggerPockets Podcast. Of course, there is a wide variety of answers, none of them more right or wrong than the other, but there is one thing that can be a true deal maker or breaker when it comes to giving up, failing, or never getting started—mindset.
Mindset is such an important part of investing and financial independence and such a key factor to not giving up, failing, or never getting started.
So how does an investor/landlord/property manager not only keep their head above water but maintain their focus to ensure long-term success? Here are a few simple reminders to play on repeat during the day-to-day or when times get tough. They’ll help keep you in check when you’re feeling overwhelmed in the real estate game.
5 Mindset Hacks to Conquer the Roadblocks That Sideline Other Investors
1. Assume positive intent (until you know otherwise).
Assuming positive intent is a must for first interactions. This is especially helpful in problem-solving scenarios like dealing with a tenant concerning late rent or a contractor/handyman who didn’t meet expectations. It steers investors away from anger, fear, and emotional responses. This hack ensures its users will also be following that oh-so-important “golden rule” when interacting with tenants, contractors, agents, managers, etc. Treating others the way you want to be treated isn’t just the right thing to do, it also means you’re much more likely to find reliable, responsible tenants and contractors who keep coming back to work with you. You’ll certainly have much more joy and sanity as you juggle it all.
Sam’s new tenant’s first full month’s rent through ACH payment fails. His first reaction is to get upset, both with the tenant and himself, thinking he did a bad job of placing the tenant and that the tenant has already let him down. Then he reminds himself to “assume positive intent.” Maybe the tenant accidentally tied the auto-pay to the wrong account number, or maybe there was a mistake on the bank’s end. Assuming his renter has the best of intentions allows Sam to treat the renter with patience and kindness, hearing them out when getting to the bottom of the problem.
It turns out that Sam’s new tenant did not budget correctly for the first month’s rent. By assuming positive intent, he is able to communicate calmly and effectively with his new tenant, ultimately collecting the full rent and failed payment/late fees, while establishing rapport. His tenant then listens to him when he emphasizes how important prioritizing rent and paying it on time is and trusts that the consequences of not doing so will be handled swiftly and consistently each time (through late fees, notices, and eviction). He has no further issues with late payments from this tenant for the remainder of the lease. He’s trained his tenant, kept his cool, and behaved in a way he can be proud of.
Related: 4 Books to Help You Adopt the Entrepreneurial Mindset
What It’s Not
Assuming positive intent does not mean being naive, allowing yourself to be taken advantage of, or continuing to work with people who don’t have your best interests in mind. It just means your first interactions with others and your attitude during problematic situations assumes the best of everyone involved first. Act accordingly if you learn that some individuals don’t have good intentions (which is bound to happen).
2. Play the long game.
Successful investors know that they’re in it for the long haul. They treat small setbacks and short-term issues as that—small. This also means they don’t make short-term compromises that will negatively impact the integrity of their long-term goals. Investors playing the long game don’t get distracted by every little squirrel that pops up. They keep their eye on the bigger prize.
Lauren has a poor month of cash flow. One vacancy went on longer than expected, and another tenant turnover resulted in a $3,000 AC unit being stolen. She feels overwhelmed with fear initially, thinking her projections for her freedom number and for financial independence are off. She worries that many months of this type of hit in cash flow will keep her forever tied to her W2 income. Then she remembers she’s playing the long game. Like all investments, she knows to expect some ups and downs. She reminds herself that she’s prepared for instances like this by withholding for vacancies and CapEx expenses. She’s playing the long game, after all, so small setbacks here and there along the way don’t get her off course. She puts his head down and keeps pushing for freedom.
What It’s Not
Playing the long game doesn’t mean holding a property that continually has poor cash flow or causes more grief than it’s worth. By all means, get rid of those and move on. It’s also not getting sucked in by every “opportunity” that comes along—wholesaling, flipping, rentals, commercial, etc. Find your lane. Get in it. Get good at it and keep trucking.
3. You find what you’re looking for.
Things won’t always go your way, but they’ll go your way a lot more often if your words and actions reflect those that you’d like to see in the people you work closely with. If you’d like to work with griping, complaining, negative individuals, then by all means, gripe and moan it up. However, if you’d like to build a team of people who are dependable and practice integrity while filling your homes with the same type of tenants, then look for that. While you’re at it, be dependable and practice integrity by being honest, positive, and looking for the good in people and situations. A funny thing happens when you start looking for the things you want—you find them. Maybe not right next door, but at least down the street. Eventually, you see far more of the good and far less of…