The Defining Factor for Success in REI

What Separates Those Who Make It From Those Who Don’t?

We All Get Educated

Have you ever wondered why 1000 people can graduate from the same real estate boot camp, but only a tiny few will go on to be successful?

Think about it, they all receive…

The same knowledge about the business.
The same strategies for buying, fixing, and exiting.
The same inspiration from testimonials of people who’ve done it.

So what separates those who build long-term wealth from those who don’t?

Few Make It

I’m a full-time real estate investor in Baltimore city, and that’s a question I’ve spent the last 8 years asking. In that time, I’ve watched as peers have failed to get their first deal, have gotten stuck after just a few years, or have managed to scale, but then lost almost all of it.

In those same 8 years, I’ve bought, gut rehabbed, and sold over 50 flips, bringing in personal profits of millions. Beyond that, I’ve bought, fixed up, and held onto 20 rentals that I own free and clear. Those rentals alone now bring in enough passive income for my family to live comfortably.

(Don’t worry, if you think I’m tempted to get a big head, I’ve got two things to keep me in check: 1. The many mistakes I’ve made along the way, and 2. My wife.)

What’s the Difference?

Every career is different. Every story is different. But I’ve become convinced there is one common denominator all successful real estate investors share.

It’s not knowledge and it’s not strategies. Yes, those are critically important to learn in the first several months. After that, though, they’re no longer the differentiator.

It’s not even connections, natural smarts, or access to capital. Those all help, absolutely, but I’ve seen many people with each of those crash and burn.

No, the defining factor is actually one of the least talked about things, even though it’s the most important. What is it? Mental toughness.

Let’s Talk About Obstacles

OBSTACLES WILL COME

Here’s the thing, in real estate investing - whether you’re flipping, wholesaling, or brrrr’ing - obstacles will come. And it’s not a matter of if they’ll come, but a matter of when and how many. No matter what asset class you’re in - obstacles will be there. They’re like the dinosaurs in Jurassic Park… they will find a way.

Below are a small sampling of challenges I’ve faced over the years. And I’ll be honest, my responses weren’t always the best. Ok, that might be an understatement… My responses were often straight-up the worst. But hey, we’re all learning and growing, right?

As you read through them, think about how each might affect you.

Some obstacles bring discouragement…

Losing Bids: Imagine you research and bid on over a hundred houses, and you keep getting outbid, even though you desperately need another house to start renovating.
Contractor Let Downs: Imagine you’ve finally found the deal. But during the gut renovation your general contractor sleeps with his cleaning lady, which blows up his marriage and business, and he leaves you holding the bag.
Buyers Backing Out: Imagine you’ve finally gotten the house renovated, on the market, and under contract to sell. But at the 11th hour, literally the night before settlement, you get a text saying the buyer’s financing fell through.
Slow Progress: Imagine you set a goal to do X number of houses in a year, but miss it. By a lot. And when you look around at other successful investors, you’re left wondering if you have what it takes.

Some bring self-doubt…

Lack of Deals: Imagine you took the “full-time” plunge four months ago, learned all the right strategies, and yet there doesn’t seem to be a single good deal out there.
Rehab Issues: Imagine you find what feels like a great deal, but three weeks into the gut renovation the whole back of your 4000 sqft house falls off. Unexpectedly. And your rehab budget just increased instantly by $20k.
Long Vacancies: Imagine your rental is sitting empty for 3 months, and you don’t feel like you can drop the price, and you’re wondering if you were way too rosy with your initial calculations.

Some bring overwhelm…

Lengthy Lawsuits: Imagine you purchase a house, but then three months into the repair you receive a phone call from a lawyer. And that lawyer informs you his client will be suing you for ownership of said house. And that lawsuit sends things to a screeching halt for 18 months.
Criminal Squatters: Imagine you finally finish a $150k gut renovation, and your days away from putting the house on the market. As you drive by the house admiring it’s beauty, you discover a squatter has moved in and changed the locks. And then police say there’s nothing they can do.
Nothing Working: Imagine your gut rehab is way behind schedule, is way over budget, and there doesn’t seem to be an end in sight.

Some bring harsh self-cristicism…

Poor Screening: Imagine you didn’t properly screen a tenant and they absolutely trash your house.
Poor Management: Imagine you don’t stick to your guns and advance a contractor too much money, only to have them run off with it.
Poor Follow Up: Imagine you’re feeling discouraged and you procrastinate following up on a lead to buy a house. A couple days later, though, when you finally do, you discover your own procrastination is the very reason you missed out on the deal.

Some bring worry…

Worldwide Pandemics: Imagine there’s a pandemic resulting in a city-wide eviction moratorium, and multiple of your tenants decide to live rent free.
Bad Appraisals: Imagine an out-of-town appraiser rips away $54,000 of your sale price in one foul swoop, and all of your profit with it.
Bigger Competition: Imagine one of the biggest investors in your state starts targeting your exact kind of deal, threatening the very way you do business.

Our Response Determines Our Success

When it comes to these kinds of challenges, it’s our mental toughness that determines our response. And it’s our response that determines our actions. And it’s our actions that determines our success.

And that’s my single goal for you, to succeed. Well, check that. I actually have a double goal for you. To succeed in business and to thrive as a human being while doing it.

Myths About Mental Toughness

What It Is

Since there are a lot of definitions of mental toughness floating around, let me be real clear about what it is and what it isn’t.

To me, it means the ability to keep showing up - day after day, week after week - and executing at a high level, even amidst adversity. It doesn’t mean you’re a robot, but that you have the ability to perform under pressure, even when the situations are stressful and you’re feeling that stress.

Some refer to it as grit, some as resilience, some as mental fortitude or mental strength. I’ll use these terms interchangeably. They all refer to this same ability to face hard circumstances and keep taking the right action.

What It’s Not

Here’s what it’s not:

Feeling no fear and taking maximum risks for maximum rewards.
Being unaffected by discouragement or worry.
Only thinking great, positive thoughts.
Going solo and never needing help.
Never giving up no matter what, even when it’s smart to pivot.

The Biggest Myth

Here’s the biggest myth people believe: that mental toughness is something you either are born with or you’re not. This is simply false. (And if it was true I’d be in big trouble, because I don’t feel like I was born with much of it.)

The reality is that mental toughness is like a muscle, and it can be trained and grown. So, even though we are each born with a different amount, we all have the ability to level up our mental strength.

In fact, for the obstacles above, I wish I could say I handled all of them with the grit of an accomplished Navy Seal. The truth, though, is I struggled through many of them, especially in the beginning. But the good news is I’ve grown a ton, and that I continue to grow each day.

What I Can Offer You

My Own Example

Your mind can be your greatest advantage or your worst enemy. And my goal is to help train your mind so you achieve success. How will I do that? The best way I know is to show you exactly what I’ve done. And this will require me to open up about my own challenges, my own dark times, and my own struggles.

I feel like we all learn best by example. I hope my openness allows you to see first-hand, how my mind went from being my worst enemy to one of my greatest assets. (Well, most of the time... I mean, who doesn’t have an off day where they just want to eat Cheetos and watch Netflix?)

Knowing You’re Not Alone

Obstacles are the reason most people quit or flame-out.

You think you’re the only one dealing with them.
You think you’re doing something wrong.
You think you don’t have what it takes.

I’ve been there. Heck, I still am “there” sometimes. I want you to know you’re not alone.

Personally, I’ve found it hugely helpful when other successful people share their struggles - even if they don’t tell me how they solved them. I’m encouraged by just knowing a strong person exists who is going through the same things I am. The only problem is this kind of sharing usually only happens behind closed doors.

Authenticity

I want to offer something to you that most people won’t… authenticity about the struggles of my business and how I got through them.

Have you ever felt like everyone at a REIA event is wearing a mask and only bragging about their wins? Ever feel like you’re wearing that mask too? I’ve been there. It feels like everyone just has smiles and victories, when on the inside at least half the room is struggling, even though no one is talking about it.

I want to share with you without that mask on. I’ve been through the grinder, I’ve made it to the other side, and I want to give back to those who are in the midst of it.

I’ve done a lot of this transparent sharing in person and with small groups over the past couple years. And I’m at the point where I feel comfortable sharing with you, a stranger on the internet, as well.

A Proven Way Forward

I want to help you train and grow your mental toughness… just like I did. I want to offer you the exact things I did to help me get through the hard times of entrepreneurship, and to thrive in them.

The ideas aren’t super complicated. Most aren’t even original to me. And don’t worry, I’m not going to charge you for them.

Something You’ll Find Nowhere Else

Like I said, I have two goals for you in your REI entrepreneur journey… success and happiness. So, I want to create a website to help you get there.

It’s one that I wish existed when I was in the trenches:

A website devoted to growing mental toughness in REI
Written by an actual investor who has been through it
Written by an investor who is willing to be open about it

Because, honestly, I don’t know where you can get that anywhere else.