An investor in the Inland Empire but not investing in the IE...Whaaaa?

[Steven Story]

Hi there Inland Empire investors.  My name is Steve and I actually live out here but I am not investing out here...yet...I'm looking at markets in the Mid-west but would still like to talk to and network with people out in Cali! Know any good real estate clubs?  Want to start one?  Where the heck can you find cash flow properties...etc.  I would like to invest in real estate in Southern California eventually but I don't have the capital or experience to do those deals yet.  Anyway I'm just throwing out this line to see if any Southern California investors want to mash brains.  Thanks for your time! Happy house hunting!

[Aaron Mazzrillo]

The problem with most investors is that they are working with a limited skill set, but trying to survive in a dynamic environment. They think in one dimension. I didn't read a book on how to flip houses and suddenly I'm buying properties that cash flow because I learned how to be a great MLS shopper and get a bank loan. That last house I bought out of the MLS was maybe 2012.

When a seminar comes up that has people speaking who are much more experienced than I, I go. Again and again and again and again. I have flown to Florida, San Francisco, Reno, Chicago, Atlanta, Salt Lake City, Las Vegas. I study and go to seminars taught by Jimmy Napier, John Schaub, Jack Miller, Peter Fortunato, Jack Shea, Dyches Boddiford, Walter Woffard, Jackie Lange. I used to go to every REIA in SoCal every month for years - from San DIego to Los Angeles. I still attend a few, but speak at more than I sit through these days.

I study marketing. I read the books written by the best marketers in the world. Books written recently and some written 75 years ago, plus everything in between. I also study copy writing. I read books such as Words That Sell, Phrases That Sell, The Ultimate Sales Letter, The Letter Book, Scientific Advertising, Confessions of an Advertising Man. I study Jay Abraham, Dan Kennedy, Claude Hopkins, Gary Halbert, Joe Polish. I signed up on email lists, I watch youtube videos and listen to podcasts. 

I test and test and test. I have advertised by letter, post card, Pennysaver, radio, t-shirts, vehicles, internet, door knocking, word of mouth, bandit signs, every door direct mail, lumpy mail.

I pay consultants when I need it. I befriend the best investors I can find. I figure out how to bring value to them. I figure out how to get into their life. I study and learn from them. I copy, I mimic, I reinvent, but most importantly, I listen to find out what is working.

This isn't a hobby. It is all I think about. I got out of bed at 6:30 AM (on a Sunday) and drove a neighborhood I've never been in. I went to a yard sale to see if they were moving and work on my negotiation (but I didn't end up buying anything). After that, as I drove 1.5 hours up into the mountains, I listened to an advanced house buying strategies course on CD. While I fished and hiked for 7 hours, I thought about deals I'm working on and better ways to find more deals. As I came up with ideas, I emailed them to myself from my phone so I can go over them in the morning with fresh eyes. It is almost midnight and I'm browsing this real estate website answering questions and participating. Soon, I'll go to bed and read yet another book on marketing, real estate, strategy, mindset, or maybe finance. 

I immersed myself in this business for many years. I am forever a student of this business. This is not my job. It is what I do.

So, I can get a cash flowing house in SoCal, in this market, because I don't just look at price, rent rates, and debt payments. A house is like a side of beef. It has lots of useful parts; depreciation, rent income, occupancy, appreciation, amortization, leverage, interest, management. Like a good chef who can take any cut of beef and serve it up in unlimited numbers of ways, a good investor should be able to utilize and possibly spread around any of those house parts to find a solution. 

I talk to hundreds of potential sellers every year. I would say the real number is over 1,000 a year. I analyze potential deals every day. I hate to let a day go by without making an offer. That is the goal: An offer every day, 7 days a week. That is a minimum 365 offers a year. If I miss a day, I owe it the next. If I get 2 today, I don't get credit tomorrow. The minimum is 7 new offers every week. And remember, I don't buy out of the MLS so I am making 7 offers direct to property owners.

When you look at as many deals as I do, and you are willing to put in the effort to learn how to identify opportunity, structure transactions to create deals that work for both you and the seller, you'll find what you are looking for. Until then, you'll only find what you think you can find because you are working with a much smaller skill set than your competitors. 

Frankly, I don't think I do that many deals. While I always try to have at least one escrow going, I'm not really ever that busy. I know people who do dozens more than me year after year. If you can't figure out how to find a cash flowing rental, learn how to find a property you can buy below market and flip for a profit. Do enough of those, take the cash, and pay cash for a rental. Nothing cash flows like a free & clear house! See, there's always a way. You just have to uncover the way that works best for you.