The No-Brainer rule became inviolate policy for my firm back in the early 1980s. It came as a result of my analytical skills having been improved significantly by highly advanced education, experience in the market, and plain old repetition. Do dozens of five year after tax cash flow analyses. Then utilize that data to generate both Internal Rate of Return (IRR) and it’s field leveling cousin, what we OldSchoolers still call Financial Management Rate of Return (FMRR). Do all that in less than six months, and as in anything else, you’ll get fairly adept at it.
The real value of deep, empirically documentable analysis.
As is true in most things in life, a decision between two or more options is preceded by the decision to modify or even abandon the status quo. Let that resonate awhile. Put differently, the first analysis better be whether or not messin’ with the status quo will be an obviously beneficial move. Want even plainer English?
BawldGuy Axiom: Never, as in never ever, make any move with anything in your real estate investment portfolio unless it’s a slam dunk, no doubt, absolute no-brainer. If it doesn’t result in obvious and significant improvement — DO NOT DO IT.
I’ve lost count how many times I’ve had to convince clients or referrals to stand pat, even though they were gung-ho to get goin’ with whatever’d pushed their hot button. One day long ago I stumbled on the magic words that stunned them into seriously reconsidering their stance.
“If you do this, the only person in the transaction who’s gonna come out better off is me. I’m the only one who’s gonna make much money here.”
Like I said, magic.
Folks aren’t used to hearing such things from their brokers. But sometimes shock therapy is the only thing that works — and that approach hasn’t failed too many times. The last time it failed? I begged a youngish couple to rethink their full on charge to invest in an immensely popular real estate market. When I refused to help them in any way, they found a local broker there, bought two rental homes — and lost ‘em about 30 months later.
I literally begged ‘em. They called me to help them when it went south, but it was far too late. Besides, a magic wand has never been part of my arsenal.
BawldGuy Takeaway: Violate the no-brainer rule at your own risk. I won’t be a part of it. And that decision has always been a no-brainer for me.
Here’s a no-brainer idea — gimme a call. You’ll find me at 619 889-7100. Or, use Contact BawldGuy to drop me a note. Either way we’ll figure things out together. Have a good one.
Related posts:
- How Do Real Estate Investors Define ‘No-Brainer Move’?
- The Funny Side Of Real Estate Investing For Retirement Through Purposeful Planning
- Real Estate Investing — Life BEFORE Retirement
- Real Estate Investing For Retirement — Boomer’s Kids — Hard Times As Teacher
- The #1 Myth — Investing in Real Estate For Retirement — Boomers Beware
About BawldGuy
Recent Comments