When it comes to real estate investing very few investors actually look at building their property portfolios as a real business. They need a shift in their way of thinking and to approach real estate investing more like an entrepreneur.
In our opinion two of the essential keys to running a successful Real Estate Development business are using great systems and forming great long term relationships.
Entrepreneurs use proven systems and leverage off others to run their business effectively and they view their business as separate from them. They realize that they are not their business and see their business as the end product. A property developer who understands that, has a real opportunity to become very successful.
When you realise that real estate development is a business and that your business is your product, you can then start to work on building your business. To build a successful real estate development business you will need to change the way you think and your approach to real estate investing.
We believe that the ultimate real estate developer is what we call a ‘Real Estate Development (RED) armchair entrepreneur’. You see, the traditional property developer still thinks that real estate development is a job. They believe that time equals work and work equals money, whereas a RED armchair entreprenuer believes that time equals equity and equity equals freedom. In other words if RED armchair entreprenuers spends the time to build equity it will allow them to get free of the business and if they want more freedom they build more equity.
Traditional real estate developers still believe that they need to do the work and be part of the system whereas RED armchair entreprenuers believe that they should build great relationships and have others do the work. This enables RED armchair entrepreneurs to build their businesses much faster.
When the business owner is also the hands on developer it will usually require much more hard work to make the business successful. It is much smarter for anyone considering entering into the industry to set up a business where the systems run the business, and let others run the systems. In other words the systems and other people work for you so you don’t have to.
Working on your business allows you to work on the things that really matter and that will give you the biggest return for your efforts. RED armchair entrepreneurs use systems to streamline tasks and avoid chaos so they can concentrate on growing their business efficiently.
When the systems are being run by others RED armchair entrepreneurs are able to focus their attention on innovation. They can capitalize moments of inspiration and through effective communication they’re able to turn their dreams into reality.
If you think about some of the great property developers, names like Donald Trump will typically come to mind however one of the biggest property developers was actually a school drop-out, Ray Kroc the founder of McDonalds. An entrepreneur with an incredible vision who worked on his business and not in his business.
You see Ray never considered that he was in the hamburger business but rather that he was in the business of real estate. Ray secured development sites in great locations, put fast food restaurants on them which he franchised. Ray Kroc died on January 14, 1984 and was worth an estimated $500 million.
YOUR ULTIMATE GOAL
As business owners and proud parents our most important asset is time and as much as we wanted to be actively involved in real estate development we knew we didn’t want to be traditional real estate developers who worked long hours trading their time for money.
Instead we looked at the big picture and applied the same entrepreneurial skills we had developed in our architectural practice to property development. Real estate development had to contribute to our ultimate goal of achieving financial freedom and giving back.
We knew that when we achieved our ultimate goal it would give us more choices so we could start to live our dream lifestyle according to our core values and with passion and purpose.
To be successful at real estate development you need to connect with what is most important to you. As soon as you start thinking more like a RED armchair entrepreneur and set your ultimate goal or the dream that drives everything you do the more real estate development will give you a sense of direction and purpose.
Your ultimate goal will make you want to jump out of bed in the morning and stay up late, it is your innermost driving force. It will allow you to live your life intentionally, rather than randomly and it will motivate you to achieve your full potential.
Setting your ultimate goal has nothing to do with real estate development. It is about how you want your life to be like.
It isn’t about material things, or about others. There is no right or wrong answer because it will be different for everyone. It is about your life so it is, in essence, what is true for you. Real estate development is only a vehicle that can be used to support your ultimate goal.
To set your ultimate goal, you should start off by asking yourself questions such as:
* What do I need in my life?
* What do I want in my life?
* How do I want to live my life today?
* How do I want to live my life in 2, 10 or 20 years from now?
* What has given me great joy so far in my life?
* If I had a magic wand and my life could be anything I wanted it to be, what would that life be like?
Knowing your ultimate goal gives you the ability to make conscious choices that are consistent with what is important to you, your core values. It will help you set your life’s purpose and put real estate development in its proper perspective.