How to Be a More Efficient Real Estate Investor
When people think of real estate investors, they envision men and women leisurely sitting on yachts, sipping champagne and laughing at how easy life is. Of course, the reality is that professional real estate investors are some of the busiest people in the world. Active real estate investors are always buying or selling, managing rehabs and working leads, all the while on the lookout for more opportunities to make more deals. Frankly, it’s exhausting work. And if you don’t know how to be efficient with your time, everything can take five times longer than it has to.
Outsource Tasks When Possible
Real estate investors wear many different hats throughout the course of a day. One minute they may be cold calling leads, the next minute stuffing marketing envelopes and the next minute running numbers on a potential new investment. Many tasks that a real estate investor has to do don’t actually require a lot of experience or technical know-how. Those are the tasks that should be outsourced. When menial tasks are outsourced, investors free up time to do the hard work that only they know how to do. Tasks can be outsourced to a dedicated virtual assistant, a team of freelancers or even to your own children, if they’re old enough to do things like stuff envelopes or make photocopies. Outsourcing tasks improves time efficiency and productivity levels.
The busy life that a real estate investor leads requires physical stamina and mental focus. Sure, you aren’t running a marathon everyday, but you probably work long hours and need to make careful calculations before you invest in a new project. That kind of work doesn’t go well with poor nutrition or a lack of physical fitness. To feel energized enough to face each day, make exercise a priority. Consider a mental and emotional health regimen such as Yoga or meditation. Even going for a massage once a week can help clear the cobwebs mentally and physically.
Consider More Passive Investments
Another way to be a more productive real estate investor is to fill your portfolio with more passive investments. An ideal situation would be to slowly replace labor-intensive investments with things like managed turnkey rentals and especially private money lending. Private money lending is practically 100% passive income, so it’s difficult to get more time efficient than that. Both turnkey rentals and private money lending can free up your time considerably so you can either pursue other opportunities or take some time for yourself and your family. Eventually, you could have a fully passive income portfolio that would see you through your retirement years.
If you’re the type of real estate investor who makes a lot of cold calls, you should be using scripts to make your calls more efficient. Cold calling is challenging enough not to have answers on hand for every nuance in the conversation. You can buy pre-written scripts for just about every scenario that you’d be running as a real estate investor. Or, you can write your own scripts, which you can customize to your personal style and needs. Whether you decide to buy stock scripts or write them yourself, using scripts is a good way to increase your efficiency.
There are some very good apps that help real estate investors run calcs on prospective properties, manage properties and estimate rehab costs. They won’t actually do the hammering for you, but they can automate a lot of common tasks that real estate investors need to do. Do a search in the Google Play store for real estate to see a list of relevant apps. The more apps you can integrate into your everyday processes, the more efficient you will become.
Hire a Tax Professional
Hiring a tax professional is a little like outsourcing, but even better. As a real estate investor, you’re eligible for a lot of different tax deductions. But you’re also liable to follow some very strict tax regulations, especially if you do things like use the 1031 exchange or self-direct your retirement account. Hiring a tax professional will not only save you time and money on your taxes; it will keep you on the right side of the law, which is always smart.
Chunk Items Up
Studies have shown that humans don’t actually have the ability to multitask. We can only focus on one thing at a time. Further, when we try to do too many different things at once, that takes more time than if you do one thing at a time and then go on to finish something else. The reason is that the brain needs a few minutes to transition to the new task. In other words, if you’re trying to quickly go from one thing to another in an effort to multitask, you’re actually losing minutes in between while your brain struggles to adjust. A more efficient way is to chunk items up. Make one block of time for one whole task from start to finish. Then move on the to next task from start to finish. This way you’re not losing any time in between.
One thing that you don’t need any studies to prove is that, the more efficient you are as a real estate investor, the more money you stand to make. Efficiency fuels productivity. Use these tips to become both more efficient and more productive.