Common Characteristics of Successful Investors
Passionate. Focused. Disciplined. Empathetic.
Those four powerful words are among the characteristics that describe many successful real estate investors and others who choose to involve themselves in real estate as a career.
While none of these characteristics is a requirement for success in real estate, people who see themselves in that profile, or who want to associate with others who possess such characteristics, may find themselves drawn to real estate investing.
Here are some details about the characteristics:
Passionate. Investors who do well in real estate are typically very driven to succeed. They have high aspirations, seek to accomplish more and more throughout their lives, and place a high value on the achievement of financial goals in particular. They appreciate the benefits of money and want to accumulate wealth. They may also be competitive and passionate about real property.
Focused. Successful investors have an ability to focus on their objectives. They don't become emotional about opportunities or setbacks, nor do they allow their emotions to rule their decisions. They understand that investments must be profitable, not charitable, to be sustained and create wealth. They may also set goals and make plans to achieve those goals.
Cautious Yet Willing. A willingness to invest money, rather than spend it, is another characteristic of successful investors, many of whom become more eager to learn about and invest in real estate after they've achieved a certain level of financial success at other endeavors. Investors don't splurge the wealth they've accumulated; instead, they leverage that wealth through investment into even greater wealth.
Risk Inclined. Despite their cautious natures, successful real estate investors are willing to take calculated and considered risks to achieve their financial goals. They know money stashed in a proverbial mattress or placed into low-risk investments typically earns comparably conservative returns, while more aggressive investments can reap more lucrative rewards.
Disciplined. Smart investors set criteria to guide their investments and balance caution and risk-taking, and they stick to those criteria without exception. Investment criteria might include a desired positive monthly cash flow, a certain discount on the purchase price compared to the market value, an anticipated return on investment when the property is resold, or other measurable financial targets. Criteria also could include specific property characteristics or preferred neighborhoods for investment.
Hands On. Real estate investors need neither a contractor's license nor experience in property repairs. Yet it may be no coincidence that many successful investors relish the kinesthetic aspects of real property as a financial asset. Unlike stocks or bonds, property can be seen, touched, walked through, materially improved, and physically experienced. People who enjoy and appreciate those qualities are often drawn to real estate as an investment.
Empathetic. Investors who want to buy single-family homes directly from sellers need a well-developed ability to empathize while not over-emotionalizing their interactions and negotiations with other people. Sellers who have suffered a financial setback especially need to feel understood and comfortable with the transaction. Investors who lack this sort of empathy, or any of the common characteristics of success, will do well to work with a mentor, advisor, partner, or other professional who brings those important characteristics to the table.
Copyright 2007. Marcie Geffner. All rights reserved. No part of this article may be used or reproduced in any manner whatsoever without written permission of the author.
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