Investor Quarterly™ June 2016 - Page 22

iQ Expert Insight 22 In fact, in the stock market It’s much easier to get bigger and faster returns when the market is crashing because the fall is faster than the rise. When you think the stock is going to go down in value and bet on that fact, It’s called “Shorting the market” and it’s made A LOT of Millionaires [It has also taken millions in a split second, which is why personally, I feel safer and more in control of real estate]. Now if you are in a few cities in California on the beach they only meet once every SIX MONTHS to approve plans. This will affect the working relationship because construction isn’t able to be started or completed. This causes you to fall MONTHS behind schedule. Now imagine the Hard Money costs to hold that property, destroying your ROi while you wait the six months for them to convene. So why is it then that Real Estate SUCKS so bad? Why is it so hard to get things to happen, to get people to do what they say they will or to get the profit spreads you hear about on TV? Most of the time it comes down to ONE SIMPLE WORD… Expectations. In the 10+ years I’ve been speaking, teaching, coaching and investing the one reason I consistently hear So why does that have anything to do about why things went south is Expectations, with investing? they expected X and Y happened. Well if you are going to lend your money on a deal you have expectations about how you will Now you may be thinking how do expectations be compensated. If you are a contractor, you make a deal go south and the answer is, it’s easy. have expectations about how you are paid and if 80% of the time the reason deals go south isn’t you are an investor you have expectations about one BIG thing, rather it’s multiple little things working with your team. that over time grew exponentially. Let’s say you expected the Contractor to pull the permits, but he expected you to, or you have an architect The problem with expectations is, if they aren’t who doesn’t get along with the city planner realistic everyone around loses. Most people because of an affair gone bad and you are now don’t know they have unrealistic expectations. feeling the repercussions of their affair and your They went to a seminar and were told you can expectation to have these jobs stay on time and make $40k on a $100k investment. Now can on budget [was just blown away] and is out the you? Yes. Is it normal? NO. It doesn’t happen every day. window. The Pitfalls of Instant National Criminal Checks Many real estate investors and property managers have relied on what is referred to as an Instant National Criminal Check for conducting their tenant screening. The primary reasons are one, it is fairly inexpensive and two, information is returned within minutes. Unfortunately there are significant pitfalls in relying solely on the information from this source. Recent reports have stated that about 65% of the information that should be reported are actually in these databases. There are currently no requirements around the frequency that courts are required to update their information. There are four states that do not report into these databases. (Does not include: DE, MA, SD & WY.) I am a real estate investor and owner of a background screening company. I deal with real estate investors and property managers. My recommendation is not to dismiss running an Instant National Criminal Check but use it in conjunction with a county crimi [XˈHX[[YHوH[[][ۘ[ܚ[Z[[X\]]\ݚYH^ٙ[\Y\H[ܛX][ۈ܈[YH]\[]\ݚYB\ܚ\]\[ܛX][ۈ[ˈHۙHX[Y[[[[[[Z]Y[HXX[ݙ\HX[X\]HY\XH[[H[Y\H\X[\\YY[ݙ\H\ žYX\[ۙ]H[[ܙY]\ܝ ۸&]X]]H[[H]X[]HXܛ[X܈H[[ܘ]YX][ۈو[[[[^[]K[\]HXܛ[X\X]\H]8&\\ \H\Hۙ\X[Y\[H\\H›Z[[Z^H[\\[X[\[\Y[ \HX[Y\&\]\H]\Y[Z\\BX[Y[Y[ٝ\HXYH[Z\Xܛ[X[\\]\XX[HZ[™ۙH\\و]XˈY[H]H[H]Y\[ۜX][\\[\[HY[YHXX] X\Z\ۙ\UXXܛ[ܙY[[ˈXXܛ[ܙY[[˘BٙXN  MH  M