Similarities of Real Estate Investing and Athletics

If you read our "ABOUT US" page you would know that one of the things I love to do is play basketball.  I may never know the exact reason for my passion in the Sport but my guess is it's because of the competition and the drama and everything in between.  I guess men never really grow up when it comes to our little adventures.  Plus, it keeps me in shape.

Recently, for the past fourteen Sundays I have been playing in a Basketball League and for two years in a row now, to our dismay we again lost the CHAMPIONSHIP GAME. 

What also hurts is that we just did not 'just' lose the game. We got KILLED (losing by a staggering 30 points.) There are a few reasons for our disappointing loss.  A few key factors which I relate to Real Estate Investing as well.

One, in basketball in order to win you have to have the BEST players.  What I mean by that is that they should know their particular roles in order to function as a TEAM. We all heard about professional or amateur players that only think of themselves and not coincidentally brings their team all sorts of things, except the ultimate goal- the Championship.

Same with Real Estate Investing, In order to be successful (Win) you have to have the BEST people working with you to reach your goal.

First is your Loan Officer who should handle your loan to your benefit REGARDLESS of what he or she would make(commission) in the Origination Fee (front charges) and their Rebate (back charges).

Second is your Real Estate Agent.  He or She should Listen to you. "What are my client's objectives?" and should tell you what the Market says about it whether or not you would like it.

In Athletics the Best Players have the following attributes:

1.  STAMINA (he who runs fast and longer will almost always win the game)

2.  TALENT (God Given, but the I believe we can also develop this through right practice)

3.  And of course, the one and only thing you cannot teach, HEART (Determination,Passion,Commitment).

In Real Estate your Loan Officer or Real Estate Agent should have the following attributes:

1.  MARKET KNOWLEDGE- Knowing what the market has done and is doing gives you almost an unfair advantage in knowing (an educated guess but probably better than the guy invited in the media as the so called 'expert'.) where it's going and why.

2.  MARKET SKILLS- Having the knowledge that comes from having the "know how" to get around certain loop holes or hiccups that could affect your investing whether in the positive or negative side which the consumer would normally would not really know.

3.  INTEGRITY- Like the HEART(possibly a player's best attribute) this part you also cannot teach because of the fact that we were all raised differently and we all have different "beliefs" on how we should be treated and treat others.

     Wikipedia describes integrity (this is perhaps the best definition of integrity I've ever heard in my life) "Integrity is a characteristic that belongs to people who are self-actualized. It is the quality or condition of being whole, complete, unbroken, and undivided. Knowing oneself heightens a person's integrity.

The Ethics and Guidelines that all real estate agents need to sign are something that should never be taken lightly (I need to remind myself constantly of this) But fortunately there is a lot of loan officers and real estate agents  who really works in the best interest of the consumers.  Consumers can find this out through the past clients of the particular agent ( note to the brave: call your agent's past clients) and/or simply interviewing the agent and loan officer extensively before committing to anything.  Do not be afraid to ask tough questions.  The best agents I know of thrive and perform the best when challenged  by their clients.  One agent told me that her client, even before meeting her, had a 15 point checklist on what he wanted in a real estate agent.  This, according to the agent, made her even more excited to work with this particular client.  Now, that's a WIN-WIN situation.

In Both Arenas (basketball and real estate) It is very hard to win if you're missing one of the three things I mentioned above.  Unfortunately, the past Market Boom makes that statement untrue because a lot of people made money simply because they were in the right place at the right time in one of the best real estate markets in the history of  Reno and in the United States.

But those days as Robert Kiyosaki (wiki Robert K.) said, "is like winning the Lottery" it was just plain luck and as you and I know there is no specific way to get lucky.  You can have the top Feng Shui masters from China 'bless' your property, but if it is not priced right it will not sell and If you buy a house now and decide to flip it (expecting a hefty profit) It Will Not Happen! (Of course if you purchase a house with a $100,000 leverage from the Market Value then Maybe you can profit)

Going back to the basketball game..

The rest of my Teammates and I were all sincere in wanting to WIN that Championship but the other team was too.  The only difference (which I hate to admit) is that they had more STAMINA (before getting to that game we had to beat another Great Team so I think we gave our all in that game), better TALENT (they were making their 3 pointers without touching the net) and a bigger HEART (they wanted it more and they wanted it real bad. We beat them last year to get to the Championship)

As for the rest of the country including myself who are now all Hurting (Short Sales, Foreclosures, high mortgages). We were all sincere in making some (a lot) of money through Real Estate Investing.

I remember feeling sort of envious (I know. Immature huh?) of our friend who bought their house for $130,000 (2002-2003 price of a new home in Stead) and sold it for $250,000 a year after! So I sat back and thought, "Man, if they can do it, I can too! And If I wait a little longer I might not be able to buy a house."

But we didn't know anything about the real estate market (Nor did the Realtor or loan officer that was helping us.  They were as clueless as I was about the real status of the real estate market ) So I determined to talk to a few so called investors before buying the house but basing it from what happened now and from their 'investment advice', they did not know any better either. 

While 'searching' (more of looking for validation of my uncontrollable impulse to already buy a home) for some signs on whether I should buy a home, I remember reading an  article by Robert Kiyosaki.   About Booms and Bust of real estate, he was warning people of what he saw as a coming real estate depression.  Mind you, this was in November of 2005, Nobody in the main stream media as far as I can remember, nobody was reporting negative things about the real estate market. (disclaimer: I no longer believe everything he says or the principles he teaches but I still greatly admire him for his way of encouraging people and opening their eyes on the 'rat race') But In this article that Robert wrote he was absolutely right in the Money(the market was indeed about to experience a very deep recession) but I refused to listen to Robert's advice. The selfish and greedy me ultimately prevailed.  The result of this bad decision has been one of the most humbling experiences of my life.

Relating it to basketball, the whole team has been telling my teammate to pass the ball  (in the championship game) because he was having a bad game and we needed to involve our other teammates, but he did listen to us.  Before we knew it, we lost by 30 points, GAME OVER.

In moments like this in the game of basketball, you turn around and say "Well, there is always next season" you take that pain in your heart, cradle it for a day or two but move on with your life.

Unfortunately, for some who are now going through troubles, heartaches and pains because of the wrong Real Estate Decisions we made (Two year Arm loans that adjusted and are going too because of lack of information) it is not that easy.

We made a mistake but that doesn't mean we should let it Kill us.   We get beat once we stop trying, learn from our mistakes and keep on keeping on. ' Keep on KEEPING on'

I'm humbled to say that because of my losing tens of thousands of dollars in my bad investment, it has opened a whole new perspective and consequently, windows of opportunities that I have never dreamed of before. 

And for the next Market Boom- (note to the market) Be afraid. Be very afraid. Because I and many others (including you my dear reader) will bounce back stronger and you can be absolutely,positively sure that we will be TAKING THAT LAST WINNING SHOT OF THE BALLGAME. 

ALSO with that team that beat us, I Guarantee you that Next League it will not be THAT EASY.