Lessons from Generation Y

By Jose Jafferji

“Real estate investing is like an adrenaline rush. Once you start, you just can’t stop,” says Jose, who bought his first property in 2007 and hasn’t stopped since. Jose and his wife Khadija are the children of Baby Boomers, known as “Generation Y”, or the “Millennials”.

“Many of us grew up seeing our Baby Boomer parents working day and night doing stressful corporate jobs, in turn shaping our views on the workforce and the need for work-life balance,” says Jose. He says that both he and his wife realized in their newly married days that there had to be more. “We wanted to live life on our own terms.”

With a background in engineering and a knack for problem-solving, he began his quest as an entrepreneur at the young age of 25. Jose was always interested in “all things financial” and spent a few years working in the financial services industry offering people mutual funds as a primary investment vehicle for retirement. However, everything changed after the late 2007 market crash where Jose and many of his clients lost a large chunk of their investment portfolios. He quickly learned that the old mantra simply did not work:

1. Save regularly
2. Hold your investments for very long periods
3. Build a highly diversified portfolio of mutual funds
4. Stay out of debt

This was a turning point for Jose who has since dedicated his life to learning and investing in real estate and has maintained a successful track record ever since. He says “I have always been the type of guy that loved learning about investing and also took a lot of stock and options training classes before real estate. I cannot put any of my money on the line without knowing the risks. That is just gambling.”

Jose has successfully acquired a large portfolio of investment properties. With work experience in Construction Management, Jose took on renovation projects for most of his properties. He says “I don’t like waiting for the market to appreciate. I like creating instant equity by increasing the value through strategic acquisition and renovation.” Together with joint venture partners, he has acquired 30 plus units over the last few years.

This type of investment is becoming increasingly popular among real estate investors worldwide. In fact, many of them tend to hire a Brisbane carpenter, roofer, plumber, and other professionals to renovate the property and sell it for a higher price. They find a property that needs work and buys it for a low price. Then they renovate it to make it more appealing to buyers and sell it for a better price.

However talking about Jose, many of the properties he buys are in terrible shape. A large portion of his portfolio consists of foreclosures that he bought significantly under market value. On the same token, most of these properties were severely distressed and required a lot of work. A lot of them would need complete renovation in the basement (Reno Duck or similar companies can be contacted to find suitable professionals for the job) and other areas of the property as well. “You name it, we have dealt with it,” says Jose who mentions underground plumbing issues, sewer back-ups, ceiling leaks, mould issues, foundation problems, and just recently a fire claim that left us severely underinsured. “Along the way, I’ve had huge financial setbacks as well. It hasn’t been all smooth sailing,” he adds. Early on, he got caught up with a contractor whom he had paid a large sum for materials; he didn’t finish the work and disappeared. “I took a big hit. It was a substantial amount of cash,” says Jose, “but I have learned from it and continued my journey in real estate investing since.”

The reason for Jose’s success today is because he had the courage and took large risks (some that he now thinks were absolutely crazy). He says that not everything has to align in order for you to make a decision and take action. In the words of Aristotle, “For the things we have to learn before we can do them, we learn by doing them.” He also adds that resiliency is key. When you take a hit, you have to be able to bounce back and keep on moving forward!

Another one of the keys to success, says Jose, is lifelong learning. While many of his friends were out partying, Jose was at home engrossed in educating himself about real estate investing and the secrets of the wealthy. His personal library is filled with many of the best titles in real estate, entrepreneurship, and personal development. Robert Kiyosaki, Donald Trump, and are some of his favorite authors who have greatly impacted his journey.

“Everyone thinks attaining success is just about knowledge, and it is, but personal development is the most important thing,” says Jose. He adds that the skills required to build relationships, have mental endurance, and envision the future by setting goals are essential for success. Fighting discouragement, both personal and societal are a huge part of any business he says because there will inevitably be setbacks. “I spent three months of hard work on the first property I bought and didn’t make a single cent on it,” says Jose. But it wasn’t long before he had forged ahead, and bought his second property, again facing multiple obstacles. Forging forward despite all these setbacks is what is required in any business, he adds. As John Quincy Adams wrote, “Patience and perseverance have a magical effect before which difficulties disappear and obstacles vanish.”

After being in the real estate circle for a few years, Jose decided it was time to join REIN to further his knowledge and find mentors. He says, “I really admire my partners at REIN like , Richard Dolan, Patrick Francey, and Russell Westcott. They have given me hope, expanded my vision, and made me more focused.”

Jose is continuing to pursue his goals towards his vision of buying properties with joint venture capital and helping other people create wealth in the process. As Jose shares, “It is a win-win situation as the returns that I provide to my investors are much higher and safer than a stock or mutual fund. I like taking risks; however, they have to be calculated risks with controls. Buying a stock or mutual fund gives you no control, the market could drop 10% tomorrow and there is nothing that can be done to change that.” Jose, who is now a REALTOR ®, educates people about money: how wealth is created over the long term, shows examples of sample deals in the past, and earns the trust of his clients and partners alike.

His goal is to keep expanding his portfolio and purchase larger multi-family buildings with joint venture partners. He also would like to start getting into small scale development projects.

JOSE?S KEYS TO SUCCESS:

1. Dedicate yourself to life long learning. It’s important to realize that learning is a big part of what makes life interesting. When your learning is self-directed, it can be a lot more fun than school was. Read books, magazines, and blogs or listen to audio that will help you in your personal development and in your business.

2. Develop resilience to recover from setbacks. With any business venture, you will definitely face challenges. Figuring out how to solve your challenges in the most efficient way possible comes from experience and getting the right help. Say, you are short of funds to set up your venture and would require a guarantor. This would require you to know what is a surety bond and maybe apply for it. Do not get disheartened by setbacks. View mistakes and failures positively and know that they are not dead-ends. Expect them and accept them as learning experiences. Most successful entrepreneurs and investors, for example, fail many times before they finally find a business that works. They’re resilient because they don’t let failures and mistakes stop them. They use them as learning experiences the same way a scientist uses trial and error as part of the discovery process. They’ve truly learned that “what doesn’t kill you makes you stronger.”

3. Never lose your focus. The minute you get too comfortable and lose your focus, you will be a magnet to problems. If you pay close attention to your business and work on it every day, you will see results.I had stopped paying attention to my contractor after seeing results for a few months. After not checking up on the property for about a month, the contractor took off with over $15,000 and told me to take him to court as this was a civil matter. I learned the hard way that he was right; calling the police did not help and after getting legal advice, I had no guarantees of getting my money back.

4. Develop a reputation for speed and dependability. Reputation is everything in business, so make sure you use RepCheckup to monitor any reviews people write about your business, you want to be able to use them to create a sense of urgency. It greatly amazes me the number of people we do business with who take almost two to three days to return emails or phone calls. Your speed of implementation greatly affects your success especially in real estate. I would have missed out on many opportunities if I took an extra day or two to ponder about a deal. Do it now and get it done!

Jose Jafferji is an investor focused realtor whose out of the box strategies have earned him a reputation as a savvy real estate action-taker. His passion for real estate began in 2007 when he purchased his very first property. Now, 7 years later, he has transacted over 30 properties and recently received the REIN Gold Pin. Jose is a proactive investor willing to get creative and produce a solution during challenging transactions.

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