“NO” SOMETIMES MEANS “NOT YET”
Never Give Up
A DEAL FELL THROUGH
We had a deal go out of contract this week.
We’ve been working on this one for eight months, have been under contract, have been doing due diligence, and thought everything was coming together. And then some new information changed everything.
The sellers and we discussed several alternative ways of proceeding but couldn’t come to an agreement that worked for all parties. We left on good terms, understanding each other’s positions, but were unable to take it to closing at this time. We will be eating some expenses. The seller will try to find another buyer and lost time while we were under contract.
Sometimes the answer for a deal is “Yes”. Sometimes it is “No.”
It is possible that is the end of our engagement in the property we had under contract. Perhaps it is not.
“No” sometimes means “Not Yet”.
I was talking with a friend this past week. He had a business and needed more space. The building next door was vacant and had just the right square footage and extra parking. He wanted it.
So, he checked the property records and called up the owners. They told him the property was not for sale. He got his first “No.”
He asked if he and the seller could meet, at a time convenient to the seller and was able to schedule a meeting a few days later. They met in front of the building he wanted to buy. My friend asked the seller what their plans were for the building, learned more about the seller, told him about his own business and his vision for the future. They got to know each other better.
My friend made a very generous offer for the property, but the seller said “No”. The second “No”.
My friend responded to the “No” with something like, “If we could find a way that would work for both of us, let’s make this work, OK?”
As they both headed back to their cars, the seller said, kind of off-hand, “If we could 1031 it, perhaps.”
My friend thought to himself, “Now we are getting somewhere.”
But, he had no idea what 1031 meant. As soon as he was back at a computer he looked it up. 1031 is a Federal Tax Rule that allows owners of two properties to exchange properties without tax penalties.
He called up the seller and said, “So if I can find a property that you want to exchange this property for we might have a deal?” The seller said “Yes”. His first “Yes”. My friend asked what kind of property and in what location would be best for the seller.
My friend looked all over the area and found a suitable property that he could buy and exchange with the seller for the property my friend wanted next to his business.
Within a day he had that other property under contract. Within a few weeks they completed their 1031 exchange. The deal went through and both were pleased.
No sometimes simply means not yet.
DON’T GIVE UP
We all have heard the stories of Colonel Sanders, Walt Disney, Norman Vincent Peale, and others who refused to give up.
The founder of Starbucks, Howard Schultz, was turned down by 242 banks when trying to get his original loan.
The authors of Chicken Soup for the Soul, Jack Canfield and Mark Victor Hanson, were turned down by over 130 publishers. Talk about “No” meaning “Not Yet.” They persevered and were soon #1 on the New York Times Best Seller’s List.
James Michener, the author, once said, “Character consists of what you do on the third and fourth tries.” Perhaps he should have said the hundredth and two hundredth tries.
This is true in our real estate investing. My first three properties were from a man who said “No” to me. He had six properties. He and his wife were getting older. They wanted to get rid of the headaches but were wary about me, a relative novice at doing real estate, being able to follow through and close on all six houses.
I found myself saying “No” to myself. Six houses. Too much. Can’t do it. No way.
And then I decided, with the help of a friend, to focus on what I could do rather than on what I couldn’t do.
My friend ended up buying three and I bought three. The seller was pleased. I still remember exactly where I sat during the closing.
If you are considering your first (or next) real estate investment, simply as a passive investor, working with someone who is actively working the deal, you may have to move past your “can’t do it” fears and take that first step by adopting a “can do it” attitude. Find a way.
SOME OF US GIVE UP BEFORE GETTING THE “NO”
The woman looking up at all those stairs, may say to herself, “I can’t do this”. So she doesn’t even start. She gives up before she even starts.
I talk with other investors all the time who don’t even get a chance for a “Yes”. Then never make any offers. They give up or are too slow to act and never have a chance to even get a “No” or a “Yes.”
Joe and I were talking a week ago and he admitted he is stricken with what we call “analysis paralysis.” He’s afraid. Afraid he missed something. Afraid he will offer too much. Afraid he doesn’t know enough. Afraid of succeeding in getting a “Yes”. All kinds of fears. So he never even makes an offer.
I remember as a teenager being afraid of asking a girl out on a date. Afraid she would say “No”. Afraid she would laugh at me. Afraid I would embarrass myself.
A commercial broker friend of mine says, “Make an offer on every deal you look at.”
He explains that I have put some time into analyzing the deal. Within a few hours of doing my initial analysis, he counseled me to call the broker back up and verbally share what my offer could be and why I came to that price.
As a broker, he would appreciate it if more of us would do that. Who knows, we might just get an offer accepted. We can be conservative. We don’t have to make an inappropriate “low ball” offer. We can explain why we think this is a good offer, share our thinking, and ask questions.
Just don’t give up even before we get a “No”.
Several of my friends have told me of not being the highest offer for a property and still getting the contract. Others have made back-up offers on properties that were already under contract and secured the deal because they were next in line, when the property fell out of contract.
Don’t give up.
WORKING AS A TEAM HELPS US NOT GIVE UP
We at Attune Investments believe in doing things as a team.
There is nothing wrong with doing things as an individual. We just find benefits in seeing real estate investing as a team sport, as a relationship game.
Each of us on our team have different strengths – investor relations, asset management, acquisition, working the numbers, finding partners, …
And we view prospective deals from different angles. We have different perspectives. We like and trust each other and are honest and up-front with each other.
In the military, I always operated as part of a team. I counted on the skills and commitment of the other team members and they counted on me. If we were given a mission, we wouldn’t take “No” for an answer. We would find a way through to accomplish the mission. And we had each other’s backs when times got tough.
When this last deal went out of contract, our team at Attune Investments did an “after action report” of sorts. We asked each other what we learned, what could we have done better, and what would we be sure to do the next time.
We anticipated what we might do if this particular property came back to us, how we could make it work. The current “No” to us really does mean “Not Yet.”
Real estate investing is hard, wouldn’t you agree?
It might take 100 potential properties and conversations before we get a deal we can close. It might take a lot of letters sent, or a lot of doors knocked on, or a lot of texts or phone calls. It might take having doors slammed in our face, figuratively and literally. It might take having insurance policies canceled. It might take problems with tenants or city hall or title companies.
There will be a lot of “No”s in this real estate work.
We can allow that to stop us or slow us down, or we can persevere and find a way.
Which will it be for you?
For you it might be making a decision about an investment in a particular deal. You might be saying “No” to yourself, over and over again, and never taking action. You might be afraid of saying “Yes”.
Like the rest of us, I would say, “Don’t give up.” Decide what you want from your investments. Study. Find someone you can trust. Deal with the “not yet” that may be part of your reality.
Then, probably while it is still a bit uncomfortable, take action. Make your first investment. Learn and keep stepping into this real estate investing life.
Roger Banister, who ran the first sub-four-minute mile, when everyone said it couldn’t be done, once said, “The person who can drive themself further once the effort gets painful is the one who will win.”
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Harland leads our Investor Relations. He is a “repurposed” Pastor and Army Chaplain. He is an author, speaker, mastermind facilitator, and coach. Harland lives with his wife, Barbara, in DeLand, Florida.