Anatomy of a Real Estate Investor There are four categories of real estate investors. Category 1 – The home owner. The home owner has been told and believes that owning your own home is the largest investment they will make in their life. Would you not agree that an investment is the act of purchasing an asset with the intent that that asset will grow in value at some point in the future? According to Robert Kiyosaki, author of the Rich Dad Poor Dad series of books; your home is not an asset. An asset is something that puts money into your bank, not something that takes it out. Your home is an asset to your mortgage holder; it’s a liability to you. The single home owner has no investment property, they either never considered it because that’s how they’re programmed, or they’ve thought about it but decided against it because they don’t know how to go about being a landlord, or, they’ve heard horror stories and want nothing to do with it. If you ask this person why they don’t invest in real estate, you will hear answers like “I’m not a handy man and wouldn’t be able to fix all the problems” or, “I don’t want those calls in the middle of the night” or “it’s too risky”. All these excuses are nothing more than self inflicted road blocks to creating wealth. Category 2 – The small investor. The small investor may have one to four investment properties. This investor probably started with the attitude of “let’s give it a try and see what we can do”. We can further break this category down into two more sub-categories. 1) Tried it on their own and found it too difficult and bailed out, probably for a loss. This is the investor who goes around telling everyone the horror stories about investing in real estate. 2) Started with one property, was successful and added more to their portfolio. However, many category 2 investors are stuck in this category because they’ve been doing it on their own and can’t increase their portfolio because of time and energy constraints. No one has ever shown them how to take advantage of their current assets to acquire more. Category 3 – This category investor more than likely owns ten to fifteen properties and is well on their way to becoming category 4 investors. They have a plan! That plan includes a team of professionals. They utilize the services of a financial planner, an attorney, a tax expert, a real estate broker, and a property manager. Category 4 – When presidential candidate John McCain was asked how many homes he owns, the senator was unable to answer. The majority of Americans viewed this as a negative. We see this as the senator being a great investor. The team he’s hired has done such a great job that he doesn’t need to be involved in the day to day operation and his portfolio can continue to grow. Category 4 investors have achieved financial independence. Everyone should strive to be a category 4 investor. Some may say that this is grandiose thinking. It’s not. It’s realistic, and it’s possible. The only thing that holds individuals back from reaching this level is, as stated before, a self inflicted road block. Why shouldn’t everyone reach their own financial independence? What ever category you’re in, SOTO Property Management is here to assist you in everyway possible.