Published: September 01, 2010
Only Your Haircutter Knows for Sure
By Joel Block
Today was the one day of the month I go and get a haircut. One of the first things that my haircutter said to me was that his clients have been telling him he needs to get into the real estate short-sale game. When I hear a non-professional tell me that I need to get into the "game," I know the opportunity for professional buyers is behind us, and it's time to get out of the game.
Did you ever get a stock tip? If you ever got one, and it didn't come from a trader, directly on the floor of one of the exchanges on Wall Street (which would make it illegal anyway), then it wasn't really a tip. It was probably more of a joke that somebody thought was serious. By the time that information reaches somebody on Main Street, Wall Street has come and gone and taken the money off the table. This isn't new. This is not a problem in our generation, that's just how it is. That's how life works. It is important to learn something from this factual situation.
Whenever you get a tip about anything, be very careful about who that tip is coming from. More important than the tip itself is the source of the tip. In general, tips smell a lot like pyramid schemes, because the person giving out the tip is hoping to create a groundswell of support for his position so he can capitalize on it before the opportunity crashes and burns.
To be clear, this discussion is not about my haircutter. He's a wonderful guy and he's been cutting my hair for years. But the guy doesn't know anything about real estate. He's dependent on a commission-hungry broker who is pushing him into a market that he doesn't understand. So now, he's telling me to get involved in the same market, partly so he feels a little better - because misery loves company.
The problem is not that there's anything wrong with the short sale market. The problem is the tip came from someone I know is not an expert in the field on which he was providing advice. I know for certain that good tips come from sharp insiders who understand their marketplaces as well as I understand mine.
Similarly last year, my neighbor told me that his son, who is a fireman, was running to the court house to buy a foreclosure because houses are on sale. I knew at that very moment the foreclosure game in Los Angeles was over. When consumers get in the game, then the professionals must step aside because the bottom feeding is over and prices are about to rise.
Professionals price properties somewhat scientifically, while consumers will frequently base their estimates of current value on a discount from the price that existed multiple years ago. Professionals know that previous pricing is irrelevant, but consumers generally don't know it. And it is not necessarily the job of hungry brokers to educate them, so many will let consumers go on believing whatever they need to believe to make the sale.
The point is this; get your information from a credible source. If you're giving information, be a credible source. I'm not faulting brokers for selling houses, and I'm not faulting haircutters for talking about what it is that they do. I'm suggesting to my readers that if you're taking the advice, beware. Read the tea leaves. There is lots of information available if you just pay attention. And maybe your haircutter doesn't know for sure.
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We are in the real estate syndication business. We invest in properties and we offer seminars to assist others in acquiring the skills needed to raise capital (syndicate capital) to acquire properties. Imagine knowing how to pool funds to purchase any real estate investment, whether it is for single family, multi-family, commercial or another kind of investment property. For full information, go to www.syndicatefast.com.
Our real estate company is Bullseye Capital (www.bullseyecap.com), a full service real estate company that supports owners and buyers of real estate assets with brokerage, leasing, property management and mortgage services. We also provide investment opportunities to accredited investors who want to take advantage of the opportunities.
About Joel G. Block
Often dubbed a "Growth Architect" by his clients, Joel Block advises companies on explosive growth strategies by driving revenue and sales. Well known in the capital markets, Joel is a successful entrepreneur, speaker, advisor and faculty member of the iLearningGlobal community. To bring Joel into your company, please visit
http://www.joelblock.com or
http://www.growth-logic.com. Also, be sure to check out our newest project: a blog to organize the blogs that cover entrepreneurship -
http://www.entrepreneur-hub.com. And finally, for film makers:
http://www.filmfundingblog.com - our newest project.
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