CHAPTER 1

A SOUND INVESTMENT STRATEGY BEGINS WITH A GOAL-ORIENTED PLAN

This chapter is the foundation for all that follows, and its first purpose is tohelp you establish a positive outlook on the task of real estate investing. Itwill do this by illustrating that there are seven important personalcharacteristics that, depending on how you direct them, will shape whatever youdo in life.

The seven personal characteristics are determination, attitude, sound goals, aplan to attain those goals, patience, due diligence, and perseverance. Each ofthese seven is easily attained. All you have to do is to apply your best effortstoward each of these tasks.

This chapter also tackles the problem of risk in real estate investingand shows the keys to reducing that element in the investment portfolio. Theultimate aim of this chapter is to show the reader the importance ofestablishing sound and meaningful goals and how they are applied to aninvestment plan.

This chapter and those that follow are directed to the goal-orientedinvestor. The problem is that most novice investors are not properly andeffectively goal oriented. The consequence of this is that most investors havedifficulty staying focused on their task and achieving success. Good goals areessential for sustained success in any venture, so real estate investing shouldnot be an exception. The connection between a firm focus (a goal clearly insight) and a winning attitude is very important, because it will shape yourself-confidence and provide a road map for the future. The result will enableyou to overcome needless frustration and to dispel the idea of fruitless effort.

Take everything one step at a time.

KEY TERMS

In this section, the following terms related to establishing a goal-orientedplan are defined and explained:

• Success-oriented attitude

• Apparent opportunity

• Attainable opportunity

• Positive failure alignment

• Successful elasticity

• Comfort zone

• A goal-oriented plan

Knowing and understanding these terms and issues related to them will help youto learn and apply the concepts presented in this and future chapters.

Success-Oriented Attitude

The little engine that could is the basis of this concept. Knowing thatyou can succeed is the driving force that results in effective and worthwhileeffort. When virtually every task begun is completed, strong self-confidenceis generated. This self-confidence is the inner reflection of theright kind of success-oriented attitude. In person-to-person contact, thisself-confidence must be so positively charged within you that it shows ineverything about you. In sports, this kind of self-confidence is what gives oneplayer the edge over another. In essence, the adversary is "psyched out." Thepositive attitude keeps the winner charged with the vision of success right fromthe beginning. It pays off in sports and also in real estate investing.

In the business world, this simple element is often the only thing thatseparates a closed contract, a signed order, or a profitable venture fromfailure. It is a natural course of events. People want to do businesswith people who exude success and who have the confidence to prove it.

The idea is to look and think the part. It takes both aspects to work. Justthinking success is not enough. You must look the part as well.

• Know that you can and will learn the tools needed to be a success in realestate investing. Just as a novice pilot learns to fly, you will learn thekeys and the insider techniques in real estate investing and you will be asuccess—if you want it to happen.

• Don't rush anything. Take this book step-by-step and becomecomfortable with the concepts and your ability to apply them as they relate toyour goals. Building your own self-confidence is an essential part to building asuccess-oriented attitude.

Apparent Opportunity

The moment you begin to learn anything new you will have the urge to grasp whatjumps out at you as an apparent opportunity. It is like the buddingpsychiatrist who first learns of a mental disorder and begins to see it ineveryone. Learning about real estate investing is learning how to takeadvantage of opportunities that may have been around all the time; the onlydifference is that you did not have the ability to see them, so they wentunnoticed. Apparent opportunities may be both dangerous andworthy.

Novice investors often jump at a deal that looks good for the wrong reason. Forexample, dealing with highly motivated sellers is a very good source for makingexcellent deals. However, to acquire property from a seller simply because he orshe will sell it for nothing down may not be an opportunity at all because thatproperty may not serve to move you closer to your desired goals.

Every purchase or...