What is the deal with all these "GURUS"!!!!

Question

Thought I'd share my thoughts on what seems to be an explosion of real estate     "Gurus" at every corner.  Speaking as a person who just stuck his toes in the water I have noticed at every turn in my education of the game there is always someone else marketing their success by surrounding themselves in some sort of surreal euphoric background to stress how their system is unlike any other that for just a measly $6000+ you can obtain the same if not more with just a cell phone and a pencil!!!  I'm sorry but in my 31 years on this earth coming from a working class family if anything I've learned the value of hard work and innovation.  Now I am only bringing up this point because I have been very cautious of all this guru mania.  I personally cannot conceive the idea of being sold a system at such a high dollar value that will deliver success to the masses.  If the system is so great, so creative, so innovative, so original and profitable,  then why the heck would you sell to hundreds maybes thousands of potential competitive individuals?  In other words how would Steve Jobs have made Apple so successful if he shared his ideas with many potential ambitious entrepreneurs?  I just don't get it.  What I do get is fundamentals.  If anything I have seen between reading literature and studying ideas with groups of individuals such as this website, its all about learning the fundamentals and innovating and creating your way to success.  This is the same rule that applies in the free market.  I could be way off base here.  If so, I would like to be put in my place from the experienced folks of this realm.  My general focus has been to continue building a solid network, and surrounding myself with people who have attained this success.  Rather than paying for their wisdom, I choose to make a deal and work for their wisdom.

Joe Bertolino · Answer

It is easier to sell the dream (easy money based on a simple system requiring little money down and little risk) than to sell the truth that making money in real estate usually requires knowledge, time, money, effort, personal sacrifice and risk.  I have no problem paying for knowledge...but when they start using emotional fluff (financial freedom, quick/easy money, what you will do with the money, etc) I shut it down.  The real guru's are doing it,  not trying to sell you something.

J Scott · Answer

I agree with the rest of your post, but I'm going to disagree with this statement.

I've mentored three other rehabbers over the past few years, and all three are now easily making more than than this -- and they are all focusing on mostly entry-level and just above entry-level houses reselling for under $200K.  Of the three of them, I'd be willing to bet that none work more than 30 hours/week.

I personally believe that -- once you know what you're doing and have the right systems in place -- making $150K without too much effort is pretty easy to achieve, at least in my market, which is nothing exceptional.

Now, all that said, I also agree that there is a LOT more money in education, but being a real estate educator has nothing to do with being a real estate investor -- they are two completely different occupations.

Jared Orme · Answer

There is an old axiom been around for aeons.

"Those who can do, do. Those who can't do, teach."

To compound this, people who see the value of their systems but realize the limitations to income inherent in real estate, know going guru is the next level of income.

There is a realistic cap that comes with flipping houses. Odds are you hit around $150,000/year and work really hard to get it. Most flippers though only get around 50-75K/year. A really bad flipper well, can even tend to lose money with bad investments.

So the guru's teaching can net themselves a virtual non existent workload and a list of moderately successful people who worked really hard and made money.

All of this due to the economy. People who have lost jobs, 8% out of work sure, but there is literally 30% who have taken a less meaningful job. Perfect pool of people to ply your 'financial independence' marketing tactic.

Marketing is the biggest money maker.

Jared Orme · Answer

@J Scott

Wow. I have only flipped 7 houses myself and did not bring in that kind of dollar ratio. This was in South Carolina.

I reviewed your website and your numbers are stout. Relocated just recently to the North Georgia market. What are your requirements to mentor someone?

Account Closed · Answer

All of these Guru programs came out in the early 1980s too, as the housing market and economy recovered. People see the opportunity and want to short cut all the work, as other posters have said. I wonder if most people that buy the programs don't go past listening or watching the first chapter, even though they paid big bucks. Now, with ebay and Amazon, I bet even the current programs can be bought cheap...

I figure, those other 'investors' who bought a program maybe will never get over 'analysis-paralysis' so they won't be competing with us for properties and good tenants!

Steve Babiak · Answer

I agree with the above, except I would make one alteration:

"It is easier to sell the dream (easy money based on a simple system requiring little money down except for the big chunk of money for the training and little risk) than to sell the truth that making money in real estate usually requires knowledge, time, money, effort, personal sacrifice and risk."

James Vermillion · Answer

Me too Robert Adams, that is why I try to provide input to threads on BP and when I talk to people about real estate investing.  Unfortunately, some people don't listen or they pull the trigger before they even look into anything.

Robert Adams · Answer

James,
Good article! I can't stand all the spam I get from these "gurus". I personally feel like if they were doing so great at buying and selling real estate they would be out do that instead of trying to give lectures for a fee. I feel bad for all the suckers they get money from.

James Vermillion · Answer

I have very strong thoughts on real estate guru programs...so much so that I wrote an article for the BP Blog not too long ago:

http://www.biggerpockets.com/renewsblog/2012/07/05/purchasing-real-estate-guru-programs/

Joshua Dorkin · Answer

Mike Nelson - Here's an article that I think you'll want to read:

The Real Estate Guru Trap – How It Works & 4 Ways to Avoid It

What is the deal with all these "GURUS"!!!!

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