Emotions, Fear and Greed can impact your bottom line way more than you may realize. Every day I get asked, “What do you think is going to happen with the real estate market?” I just simply reply back that these are very interesting times. I also remind people of what their personal long term objectives were when they first started buying real estate. Definitely with a $60 dollar barrel of oil and a new provincial government coming to power here in Alberta there are some uncertainties coming our way. My simple response when asked about the market is to always make sure the Fundamentals are being met and focus on your end goals. My client’s tend to lean on my 18 years of real estate investing experience as well as keeping up to date on mortgage and financing trends. This week I am sharing what many of my recent phone calls have covered.
“I might miss out on this sure fire winner property…”, “This one property will go up two hundred thousand dollars in the next year…”, “ I might lose a ton of money if the economy doesn’t pick up soon” and “What if I lose my job?” These are all examples of real life thoughts that can typically cross a person’s mind throughout their time real estate investing. The trouble comes when these thoughts grab ahold and allow that nasty “Fear” or “Greed” emotions to enter. When these emotions prevail for any length of time it can lead to decisions and actions that do not get us closer to our goals or reverses any progress we may have made. Recently I bumped into a fellow named Doug. He looked familiar and I knew that I had met him several years before. I just could not for the life of me remember where. Doug approached me with a smile and began to chat. It turned out that I had in fact met him about ten years ago at an investor conference and he recognized me. We covered a few light topics and then I had to ask…. “How was his real estate business doing?” Doug began to tell me that he was very motivated back ten years ago. He actually bought several properties and due to a few challenges and the threat stemming from the 2001 dotcom bust eventually sold everything he owned. Doug then began to tell me about how he looked at the prices he had paid for those properties back then and knew that “IF” he had kept them the values would be considerably higher today. I was very proud to hear that the future investment plans were to get back engaged in an investment vehicle he knew works. His comment to me was that I was lucky that I had stuck with it! To that end I agreed. We both had a moment of realization that if Doug had not given up and stuck with it through his challenges he would be in a much different spot today financially. My hope and wish for anyone reading this is that they seek out that voice of reason anytime a sense that Fear or Greed could be creeping into the picture. Most often the voice of reason comes from someone who has been there done that and can walk through the challenges with a few answers and a focus on the long term.
I think one of the most rewarding aspects of my career is to watch folks stay the course, meet their challenges and find solutions and answers rather than giving up. Many clients have actually seen the day when their real estate investment incomes climbed to a level where they could offer their spouse to retire from a job they may not have enjoyed ten to fifteen years earlier than their normal company pension plan would’ve allowed. If you are one of those people who are a nervous in these uncertain economic times then you are not alone. Having said that, I encourage you to recognize when an emotion may be getting the best of you and stay the course onward towards your financial future. There is my rant for this month anyhow. I just get real fired up when I see great people like Doug taken out of the game way too early only to realize later what could have happened. I have appreciated having my team of real estate experts around me over the years that is for sure. As well I love that I get to be one of those support team members to many of you. Keep on keepin’ on and continue to make a difference in the world! Many of you know that I help people create financial plans using real estate investing as their vehicle. This message to me is just as important if not more important as saving thousands of dollars on your next mortgage decision.
All the Best!