Why “Following the Herd” Mentality In Commercial Real Estate Investing Leads To Failure
Comments (0) Why “Following the Herd” Mentality In Commercial Real Estate Investing Leads To Failure
Article by Duncan Wierman
As real estate investors are looking for new entry opportunities and ways to make bigger profit in the current economy, much of the typical and conventional “wisdom” that may work for some may not work for all.
A prime example is the so-called Commercial Gold Rush Foreclosure “Opportunity” This example of over-hyped real estate information from marketing gurus, is all about the “huge” profits to be made with commercial foreclosures. There are quite a few new expensive real estate courses being sold by these self-proclaimed gurus who seem to know everything about marketing and sales in the industry. But do they?
Thousands of new investors have been essentially taken in with these products. They have been enticed with the promise of quick profits and real estate success. The sales pitch about the opportunity involves snatching up distressed real commercial property and then quickly selling it for a profit. Their idea revolves around the assumption that building owners just want to walk away from their troubles by giving the property back to the bank. Since many banks do not want the bad debt, it goes to the assumption there are some good profit-making opportunities.
Typically, these courses purport to include information on where to look for foreclosure opportunities or how to legally “steal from banks”. These commercial real estate courses also teach methods for “capitalizing” on property owners in distress. The sales pitch is that all the new investor has to do is simply put new management in place, get the building rented out, then turn around and sell the property for “massive” profits. Since this is the “valuable” information they taut that give investors the inside track on how to get a hold of these so-called “goldmine” opportunities, it’s no surprise that new real estate investors have been buying (into) these types of products in droves!
The Flaw with Commercial Foreclosure Opportunity Products
On the surface, especially for newbies, the opportunity that could have them making huge amounts of profit is tempting and seems rather legitimate. However, these real estate courses are definitely not for everyone and frequently teach the process in much simpler detail than what it really takes to succeed in Commercial Foreclosures.
What DOES work in today’s real estate market is getting back to the basics of real estate investing and learning from the ground up! Though money may not come as quickly, the building of relationships builds credibility! This is KEY as a real estate investor, whether new or experienced. It is fundamentally VITAL to your success. In these economic times it can be difficult for anyone but especially for the “newbies” just coming on to the scene.
TRUE success in the real estate investment field involves market research, figuring out which commercial foreclosures represent good opportunities, and finding buyers for those properties. Finding buyers, especially in this rough economy is tough, it takes practice, it takes experience to know how to be a success in this business.
Like the California Gold Rush of its day, this “Commercial Gold Rush” will have both winners and losers, too. If you remember your history your will recall there were far few winners… True, some experienced investors and some new real estate investors can profit from these opportunities that are created by commercial foreclosures, BUT the many inexperienced individuals who have been falling for these fly-by night, expensive real estate courses promising RICHES are only doomed for failure. I highly recommend not becoming one of those “Sheeple”, following the crowd over the cliff… and Investing in Commercial Real Estate the tried and true way!
About the Author
Duncan Wierman is the creator of the Short Sale Automation System that real estate investors are using to streamline the process of short sales. For more information, go to http://www.ShortSaleAutomation.com
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