Yesterday, I jumped into a Yellow Cab to head up Sixth Avenue to 34th Street. As the cab zipped passed 34th Street - I asked my driver to pull over since we just past my requested stop. The driver wanted a confrontation, and I faced a choice. I could focus on getting this irrationally angry man to acknowledge that his rage was misdirected toward me. To 'win' this confrontation, I would risk escalation of the berating and physically intimidation without having done anything wrong. Or, I could exit the situation as quickly as possible and avoiding further threat to my physical safety.
I chose to exit the situation. My priority was my physical safety.
I saw a lesson that applies to all the decisions I make - including real estate decisions. Focus on priorities to significantly increase the likelihood of achieving desired results. Here's the bottom line:
- Criteria reduce the role of luck in achieving the results you want.
- Terms ensure that money is made going into a deal so the market works for you.
My encounter with a road-raged taxi driver is a reminder that a focus on priorities significantly increases the likelihood of achieving desired results. The way to focus on priorities is simple. First, identify your priorities, then develop a plan to achieve those priorities, and finally execute that plan.
Not sure where to begin? Start at the beginning and identify your priorities. Real Estate priorities fall broadly into two categories:
(i) Criteria - These are the aspects of a opportunity that are non-negotiable and cannot be changed. For example, an investor's criteria may include location (e.g. Tenth Ave), type of property (e.g. multi-family townhouse), or the types of problems that will need to be tackled (e.g. resolution of liens, addition of floors, etc). Criteria provide an opportunity filter to select and identify predictable value. Priorities tell you which filter to apply first - and which opportunity to eliminate first - to maximize your success.
Criteria reduce the role of luck in achieving the results you want!
(ii) Terms - Terms are the negotiable aspects of a purchase. For example, a seller's terms may propose requirements on the money needed to close a transaction, purchase conditions to maximize financial value, or present value of the yield a property may deliver over time. Terms define how an opportunity is turned into a deal.
Terms ensure that money is made going into a deal so the market works for you!
The real power of priorities can be seen only over time. As such, a savvy professional knows that a successful real estate business must provide more value than the search results that can be found online - or even access to an expanded rolodex of properties today. The power of priorities is its ability to immediately recognize and seize the right opportunities whenever they appear.
Have you identified your real estate priorities? Do you know how to use those priorities?
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