Goal Setting - A Little Help? - Posted by Scott

Posted by Scott on October 11, 2003 at 21:56:46:

Thanks Terry for your input. I also absolutely agree with under committing and over delivering. So many of the claims I have read show numbers that seem unrealistic based on the various posts I have read here on this site. That is why I’d like to hear from some of the experienced folks here as to what is realistic. I can then create an attainable business plan and not end up discouraged.

So how about the rest of you. What kind of numbers have you truly experienced. Please feel free to email me privately if you wish … sdavison@att.net

Thanks everyone!

Goal Setting - A Little Help? - Posted by Scott

Posted by Scott on October 10, 2003 at 15:33:16:

I am in my Goal Setting phase right now. Based on my needs, I have my financial goals all written out. However, I would like to understand what the average profit is for each of the various RE Investing techniques so that I can now lay out my activity goals based on my financial goals.

For example, if I know that I want $1,000/month positive cash flow, $10,000/month additional income, and a positive net worth of $2,000,000 in 10 years … then I want to have an estimate (my goal) of how many rental properties I need to always have active each month, how many flips/wholesaling I need to do per month, and how many homes I need to own with $xxxx amount of equity in each (or in total) in order to meet those financial goals.

Now, I know this is almost impossible to realistically calculate. And there are sooooo many factors involved … however, in shouldn’t be too difficult to come up with a forecast and a set of monthly activity goals.

So this is what I am asking the experienced folks to help me with. If you could please, send a post back using the following format:

I have been doing REI for XX years. I, on average, make $xxx positive cash flow from every rental unit. I, on average, pocket $x,xxx from every flip. I, on average, have $xx,xxx equity in each house I own.

If you have the metrics from other techniques, that would be great. Please expand with comments as much as you want.

Again, everyone’s yrs of experience, favorite techniques, risk tolerances, region of the country, style, etc, etc will be different and unique. This will just help me gauge what is an average so that I can develop my monthly activity plans based on my financial plans.

Thanks everyone!!!

Re: Goal Setting - A Little Help? - Posted by Terry Y.

Posted by Terry Y. on October 11, 2003 at 10:26:33:

Scott, you are definetly on the right track writing out your business plan and focusing in on it. This is a very important thing that sould be completed early on in the game. This is something that a lot of investors, including myself, do not spend enough time on in the begining. I just got into this business 2 years ago and it took me 9 months to find my first deal (but it was a good one), so keep in mind that you may not meet your goals in the beginning and it is normal. After that deal, it didn’t take long to land one after another. I have to update/revise my business plan currently. My goal is going to be that I want to complete one deal a month. A deal to me would be flipping a property and making 25-30k +, or acquiring a rental property with a min. positive cash flow of $200 min. a unit after deducting all expenses. I would rather hold a property for cash flow, but if I see something that makes a good flip, I am not going to pass it up. I always go by worst case scenarios when doing #'s to protect myself and keeping the profit margin there. It is also a lot harder to recognize a good deal when your just getting started. But it gets a lot easier as you go along. As they say, “you must walk before you run” and keep your emotions out of the deals. I also want to start buying bad paper and foreclosing. Good luck! Find your nitch in the market, work hard and smart, stay away from ignorant negative people, and read lots of material!

Terry Y. (PA)