Saturation Of Investors
Ok I am new to this forum but I have to say in the short time I have been reading on here it has been exteremely informative. I would like an opinion on something. I tried to search the boards to see if there was already a post on this subject but didn't find any. Many moons ago I tried my hand at MLM. For those of you who have tried, got sucked up and spit out, my sympathies. For those of you who are defenders of the flame, I am not trying to start a fight. My point is while trying to do some of them I ran into a situation where everyone and thier mothers brother was trying to do MLM. It was totally over saturated at leaset in my area. Are there areas of the country that are also oversaturated with REI's? IS it even something that I should be soncerned with when starting out or no? I ask because I just want to be prepared for when I start trying to contact people regarding creative financing or forclosures, I dont' want to get the rolled eyes of "oh no not another one" does this make sense? I appreciate any opinions or experiences on the matter
Thanks
Joe
I tried AMYA 20 years ago and was a miserable failure! I have friends that made millions.
In real estate the same is true, for every 50 investors dabbling 1 is probably making a living at it and is a "Pro".
You are as good as you think you are and the commitment you put into it. The competition in some areas is very fierce. The cream always rises to the top, itis up to you to decide whether you are run of the mill milk or "cream"
Put it this way: If a realtor rolls his or her eyes when you mention creative financing, you don't want to deal with them anyway -- they resent you. You want someone who understands what "investment" means. Many people selling properties are willing to work with you IF THEY NEED TO SELL. Good luck.[ Edited by jfmlv1950 on Date 03/03/2004 ]
If you've not had your eyes rolled at by at least 100 people ("Oh, here's another one"
, then not enought people know you are a REI.
The skeptical WILL resent you. They are JEALOUS. Of what...
You ambition, your success, your desire to be something better than you are, your drive dispite failure.
Through all of this, you LEARN. Don't kick youself, everone else will do it for you!!
Stick with it. As people "get it" that you ARE a real Estate Investor, you will gain their respect...You will become more confident...You will gain more respect...More confidence... Vicious cycle.
The roughest roads lead to the most beautiful places..
Sam
The market is replenishable too - There are always going to be people that need help in tough situations with their property, the problem with many MLM's is that they are selling a concept, not a replenishable product. Do a search for your city on this site too, see how many TCI members are working in your area, might be a good place to get an idea who is in your market.
Mike[ Edited by nebulousd on Date 03/03/2004 ]
If property gets auctioned off on the court house steps that means it got "through" the real estate investors (e.g. preforeclosure, foreclosure gurus). A market isn't saturated until the court house steps dry up and I don't think that happens in too many, if any, areas. I personally believe there will always be deals out there--people continually die, divorce, or get into financial difficulties therefore there will always be a nitch for rei...
Good luck,
PD
Dear Joe,
What is MLM? Is that monitoring the Multiple Listing Service? I have not a clue.
Do I monitor the MLS, yes I do I message it almost constantly. But then I also have www.Retran.net and Data Trace and some covert lines into our County and City Activities.
Right now I am busy trying to correct a run a way housing market by inserting Low Cost Housing. But most times I just run defaults when the subsidary activities slow down.
Yes you are correct there are a lot more people running but alas not very many that are truly effective.
I am a Real Estate Broker, Realtor, Mortgage Broker and a Consultant in the area of Estate Management etc. etc.
When I hit the door, I am prepared to be helpfull and solve any problem that I run into. Terminal Leprosy has me baffled. But I can get you out of jail, arrange bail, help you cure your forclosure, clean your title and if push comes to shove. I can arrange for you to have money in hand as you exchange a worthless title for cash.
The other day, just cause I like to do it. I called on a gentlemen in foreclosure. He has two week 14 days before Trustees Sale. He is in denial and waiting for the great hand to decend from Heaven and save him.
As I approach the door there is a nice Asian Lady trying to talk to the gentlemen householder. She just cannot communicate. The nine tones of Cantonese have made her English a bit short. I translated for her. All she wanted to do is help him pack give him $500 and sign a quit claim deed. I translated exact and he slammed the door on both of us.
I took her crying and sobbing to lunch. This was her 20th door in the last three days and she was giving up. For some strange reason nobody wanted her $500.
I suggested she call her many many relatives and build a war chest of at least $100,000. When this was done, call me and lets reverse the present trade imbalance and let the Chinese make a buck or two and leave it here in Sunny ?? California. She had a lot of guts but the requirement is more then that. You must have a little knowledge. By that I do not mean read a book by some guy called Bob who years ago professed to be able to "Door Close" You need information up to date and specific as to your place and time.
Here in LaLa land there are many many people trying so hard to make it in Pre Foreclosure. I wonder why they just concentrate on that. There are lots of other motivations to Sell your property. Divorce, Debt, The Big BT. Government Liens. Doing the Offers in Compromise are fun. Nobody really works at those.
Does anybody run Conservertorships? Lots of Greedy Attorney's wanting to sell and fast so their fees can be made available. Good Business. Easy run, you just read a lot of cases.
Yes Joe there are a lot of people newly arrived and running. I try to help. The faces change among those jammed up but there are always more and more. Forclosures are up and climbing. Rents are now going sky hi and when that happens yip. Oh Tempres Oh Mores.
Cheers Lucius Please tell me what MLM means I want to learn.
MLM = Multi Level Marketing
You know, Amway now Quixtar, Pre-Paid Legal, Primerica.
[ Edited by nebulousd on Date 03/03/2004 ]
Oh my goodness! Let me! Let me! I want to be able to give back a tiny piece of knowledge to Lucius! I know it's a very very tiny piece but for all the great knowledge Lucius gives to us (to me), here goes. Lucius, MLM stands for Multi-Level Marketing. I'm sure you know now, what that is. The Amways, the ACNs, the Skybiz's, gosh I could go on. In some minds.... the pyramid schemes. But, much like REI, there are believers and nonbelievers. Some make money, alot don't, some make millions. Whooohoo! I've gotten to impart some information for once. God, it feels good! Toodles. Kathleen.
You know we need to discuss that poker thing and countin' cards....
This is a msg I posted a while ago on another real estate board:
<<< I used to be involved in network marketing (MLM); companies like Amway, Avon, etc. During training, they would tell us that when we were out prospecting, the idea was NOT to go out and look for people that were interested in joining the company. That would be too tiring, too time consuming, and NO fun.
Instead, what we were trained to do was to DISQUALIFY the people that were NOT interested. Moving through groups of people and determing that they were not going to be good at the business AS QUICKLY AND PAINLESSLY as possible, so that we could go on to the next group of prospects.
Once I realized this paradigm shift, my recruiting became much more efficient, and did not seem so much like work. I also gained a tremendous sense of power. Now when I spoke to prospects, it wasn't me being desperate to find a prospect. I was like a human resources exec at IBM, scrutinizing applicants for a high paying job. Next became my favorite word.
Using this approach with REI, do you see how much easier it is to sift through the scores of unmotivated sellers (= uninterested prospects)? Flip the script on them! Let next become your favorite word!
Just some thoughts from a newbie. Good Luck! !>>>
I posted this here, because I see a lot of similarities between REI and MLM.
Saturation is not or should not be an issue, because of the turnover. Everybody is not gonna stick with it. You have people who will give half-hearted attempts, but WILL quit.
More importantly, in MLM you "recruit" new prospects; in REI, you "market/target" motivated sellers.
In MLM, when somebody is not interested, has objections, disbelief, etc. YOU DON'T WANT TO WORK WITH THIS PERSON!! You will only end up either trying to force them to do the business, or they will do it badly. The recruits you want are those that WANT OR NEED THE OPPORTUNITY YOU ARE PRESENTING.
In REI, if a seller is not interested, has objections, etc YOU DON'T WANT TO DEAL WITH THIS SELLER!! You will only end up confusing them, giving investors a bad name, etc. The sellers you want are those that WANT OR NEED THE OFFER YOU ARE PRESENTING.
I know that I've strayed away a liitle bit from your issue of saturation. Honestly, I don't think it's a big issue.
HTH,
Ironlung
aka reinvestor420
reinvestor420, I hear you. Years back, in my foolish youth, I tried my hand at MLM (Equinox, if you must know, big lawsuit against its founder now). The MLM model is great, people selling people on selling people on selling people on selling...something or another, I forgot. Sometimes I wonder how any product ever got sold; visions of sympathetic relatives buying your bottles of shampoo or vitamins because they feel sorry for you for getting mixed up in it...til you drive by in the new car, and they go "hmmm." Takes a special breed.
Despite the fact that most so-called "investors" aren't doing much, a quick look at the Real Estate section of a major city's paper will show lots of investors have taken the intiative to pay for "I Buy Houses!" ads. Sure, there's competition. But there is plenty of action to go around, and I'll bet every one with an ad gets some calls, it's a numbers game. And if that's not enough, then the ambitious ones hit the streets, try bandit signs, send letters, etc. (see Marketing Forum). Just like MLM, your downline isn't usually showing up on your doorstep on their own accord, saying "here I am, I wanna give you a fat commission by sinking 5 grand into selling what you're selling, sign me up."
But yes, in the end, it's all about sifting through the chaff looking for the grains of wheat, the motivated sellers. Just wish there was less chaff but like anything else, it comes with the territory. And at least you don't end up with a five years supply of cleaning products in your closet.
Wow thanks you guys for all the great responses! This really helps me out alot and helps motivate me
Wow! A thread where my input isn't completely ignorant! How refreshing. Not that anyone would necessarily care what a newbie thinks, but:
[ Edited by thestudentisready on Date 05/15/2004 ]
I recently walked away from MLM. I'm one of the few who actually made $. Of course, I helped others make a whole lot more. The parallels between the two fields are pretty amazing.
One parallel is in the "saturation effect" mentioned. Most people think of saturation as a bad thing. Obviously, if EVERYONE is looking to do the same thing you are, this is not a good thing, but... In MLM, the truly unenviable position is to be the first in your area. I guarantee you that being the one in the jungle hacking a trail with your machete takes a great deal more determination and ingenuity.
I believe that the same is true in REI. I can't walk 2 blocks from my house without tripping over at least half a dozen bandit signs, all in their full neon glory. I recognize, however, that this probably means I will have a relatively easy time forming the necessary alliances with people who are attuned to the creative investing mindset. I, personally (to a point) welcome the "competition."... time will tell.
Both MLM and REI give people (who aren't necessarily creative entrepreneurs or trailblazers) the ability to swing from the top branches in a relatively short time. Both are also characterized by a "secondary industry." In Quixtar (Amway for the pre-genX'ers), 80% of the income for the Diamonds and above comes from selling tapes, seminars, and such to the ones on the bottom trying to figure it out.
In REI, obviously, there are "gurus" who take a similar approach. I've never faulted these gurus in either field... just paid attention... I'm a lifelong student of marketing, and there's a certain genius there that I respect. Besides, the information is usually good anyway, and I'm always up for learning something new. I pass no judgement on this aspect of either field, by the way. I just can't help but notice the similarities.
Actually, I've learned a lot from mentors in the MLM field that made millions. At the end of the day, though, I choose to pursue REI because the product itself is real and valuable regardless of the means of delivery... and because the risks are much lower. 99.9% of MLM parent companies don't last 5 yrs regardless of the effort you put in.
I love that I can fall on my face several times over the course of my REI career and still beat those odds. The success rates for individuals are better here, and most of the people in both fields are either "tire kickers", part-time perpetual researchers, or "dignifiably unemployed" anyway. I've got a LONG road ahead, and I'm just starting to learn, but this IS how I will retire. Kudos for everyone on this site for taking the road less travelled. I look forward to the opportunity to get to know you better.
Cheers.
Every time you find a great opportunity you'll find skeptics. Do your first deal and fewer eyes will roll. Surround yourself with people that believe in you and share your ideas. Those are the ones that you'll be going on month-long cruises with in a few years.
I think it's funny when people say "is this a get-rich-quick scheme"? I'll say, "no, it's a get-rich-quick system." Then I'll counter, would you rather get rich quickly or slowly??? That shut's em up!
People will think you're a carelton sheets student wanna be. There are CS students who have made a ton of money. His system is legit. Nothing revolutionary, just the same thing that has been explained in many other courses.
By the way, MLM does not equal pyramid schemes. If there's a product it's not a pyrmid. Sure there are a lot of innefective or corrupt businesses, MLM or otherwise, but that doesn't make them a pyramid. The chain letter that you get in the mail (send me $5 and send this letter on) IS, however, a pyramid.
REI can be commpetetive. The good news is that you can beat people to the punch, specialize, do volume and settle for narrower margins, etc.
After all, if you're making $25K per deal, how many do you need to do every year to replace your current job?
Finally, it sounds as if you may have an inferiority complex. Get over it. You need to do a few deals and get some confidence. Start reading books that will change the way you think.