How will you ensure your real estate business prospers in tough times?
What are you doing to adjust your business to our new economic realities?
Here are a few things you can do for your Real Estate business.
1. Keep a balanced view: Take your view on your world from the 10,000 foot level (get out of the forest and above the trees). The view from up there is much more complete. Always read beyond the headlines; remember that the headline’s role is to entice you to read the story, while the last paragraph almost always sums up the real story much better.
2. Analyze your business: What are you doing well and what not so well? What can you improve on? What must you improve on? Review your Real Estate portfolio’s financial performance versus budget. If you don’t yet have a budget then create one now.
3. Review your business plan including how it impacts your long-term life/financial plan: The business plan should be reviewed annually, and sometimes more often. Your long term life plan is the one you should have in place to achieve whatever level of financial freedom you have as your target. Your business plan is one element in achieving your life plan. Be proactive. Don’t allow yourself to drift. And don’t take the easy way out when faced with difficult decisions.
4. Involve your team and other experts in this process: They are on your team for a reason. Get their input. Ask for their advice. Involve other people who you respect for their knowledge and experience. Most of your best ideas will come out of those discussions – both your ideas and theirs, for brainstorming is a powerfully creative process and can be fun too. And you will awake with eureka moments in the wee hours of the morning - it means you have engaged your subconscious mind. Store pen and paper by your bedside so when the ideas come to you, you can record them.
5. Then take a break: Get away and relax. Read some books, go sailing, walking, running, diving, flying, driving, sit on a beach – whatever works for you. It is important to take the break only now, after you have gone through the first 4 elements of this process.
6. Now act to protect and improve the performance of your Real Estate business: Maximize your borrowing capacity to ensure you have access to as much capital as possible in case you need it - this doesn’t mean borrow more, it really means to ensure you have access to more funds should you need them. The best avenues for this are Lines of Credit (LOC), and the best kind of LOC is one that is secured to a property as the interest rates are lower. Remember, you might need to borrow for any number of reasons, from unforeseen expenses to that great deal on a property that your Realtor brought to you.
7. Set expectations for your team based on your new incentives, and clearly communicate each of these to them. Then regularly measure and report back to them on their performance as achieved vs those expectations. Celebrate their successes and address how shortcomings will be improved. If a member just isn’t getting it done – then replace them. That will often be a difficult thing to do, but to avoid it does you and the rest of your team a disservice.
8. Continue to make decisions that fit with your long-term objectives. Don’t take the easy or quick path as those often cost more in the long run and tend to move your further away from your goals rather than towards them. Then you have a far bigger turn to make to get your ship back on course.
9. Review and repeat. Review what you did to determine how to do it better next time. Do this all again at least once a year. In these times maybe twice a year is more prudent.
Do the same for your personal life. The financial side of your family also needs the same level of attention. Treat your personal finances much like your business finances. If your personal financial health is good you will reduce financial pressures that often make for poor decision-making.
Share what you learned from this. This will help to make others’ businesses better. Much more will come back to you than you put out there, including many good ideas from others that you can employ yourself.
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