The Real Estate Roller Coaster
Well, it has been incredibly hard for me to sit down and write anything after my last blog post but here goes nothing…
I think the reason it has been so hard is because I don’t want to take James off top billing on the site and the last one just took so much of my energy and soul to write. That little guy is such an inspiration to everyone he comes in contact with he just steals the show. A quick update on James, he is doing really well and such a happy, FAT little baby. We have really enjoyed him being home with us over the last 4 months and only having to make VISITS to the hospital! He is now almost 6 months old and will likely have his second stage heart surgery in May. As always, please keep him in your prayers as we can certainly feel them coming our way!
One of the biggest motivators to write this post is the incredibly difficult last two weeks I have had running this company. A lot of folks look at what we are doing, watch the TV shows, go to the REIA meetings and think everything comes easy. Well, today you are going to see behind the curtain of how things can go south really quick in this business. For me, that happened these past 2 weeks in a big way and it all revolves around what I call, THE REAL ESTATE ROLLER COASTER! It’s funny because I was just listening to a podcast today on my way home from Atlanta and Darren Hardy was being interviewed. If you don’t know, he wrote a book called the Entrepreneur Roller Coaster. Well, he nailed that one! Everyday as an entrepreneur and business owner, something is blowing up and needs help. I consistently feel like I have 30 plates spinning all at once and I am doing everything I can to not let one fall and smash on the ground. Well, that almost happened this past week as my bank account got down under $5k and I had upcoming bills of at least $60k. Big problem, right?
Let’s peel back the onion and see how this all came about…. I promise you will see how much of a roller coaster this business can be! Just when you think you have it all together, the house of cards starts falling down.
I manage our money in, money out, house purchases, investor capital, marketing money, payroll, and expenses VERY, VERY closely. As the business owner, this is where I spend most of my time putting all these deals together like a giant puzzle. Even a single day movement of a closing can become a very big deal as it has the ability to become a domino effect on everything else I have planned. And, some of the folks on my team realized that this week when they changed some dates without thinking much of it.
Here is the list of things that happened this week when I had my puzzle all lined up and ready to go:
- Buyer of a wholesale deal of ours went dark, forcing us to jump through hoops to help out the seller and find someone else.
- Buyer backed out of a retail closing.
- Hard money lender didn’t come through for one of our buyers so we had to buy the property last minute and it didn’t close on the resale for 2 weeks!
- 3 title issues on Chattanooga houses at the last minute delaying tens of thousands of profits for over 2 weeks.
- Retail closing got pushed 3 weeks because the buyer switched lenders without telling anyone on the selling side. Crazy right?
- A condo that I said I would buy came back to life at the worst possible time!
- We trained and prepared a new sales rep in Chattanooga who took another job the day before they were going to start going on appointments. What’s worse? The other rep we have there went on his honeymoon for 2 weeks at the very same time. Ouch!
- Tenant not paying rent on one of my personal rental houses.
- A/C unit blew on two of my personal rental houses.
- A dozen other little fires that popped up and had to be put out as an owner…
What did it all come down to here? A huge run of issues (I would say bad luck but we make our luck don’t we?) that culminated in no company income for 2 weeks while the bills continue to rack up and people need to get paid! This business is extremely cash intensive and if you don’t have reserves you can get in trouble very quickly. Fortunately, I was able to fund a lot of these issues myself to keep us afloat but this could have been a major problem for a new investor or anyone who doesn’t have another out or backup plan.
I am also incredibly thankful to one investor who just happened to be interested in working with us at this exact time. Again, we made our luck I’m sure. It wasn’t a big investment but it was exactly what we needed to keep moving forward and relive a little bit of the pressure for a week from all these issues. Even he doesn’t know what he did for the company with that small investment, but I am extremely grateful for the commitment he made at the best time possible.
Today, a lot of these issues got cleared up and money started rolling back in as usual. You reap what you sow for sure, I put us in this position and learned a TON from it all. I am sharing all of this not because I want anyone to feel sorry for me, think any less of our company or the way we do business, scare anyone away from doing this business, or anything other negative thing you can think of. I am sharing this because I want everyone reading it to know that it’s not all rainbows and butterflies as a house flipper and real estate investor. On top of that, if this short story can help anyone else from getting into the same position it will all be worth it!
Even with all of these issues, I still love this business, love what I do, love who I work with, and love the process! Sometimes I just need to take a deep breath and look at how great things are, even in the fog of all this disappointment. It would certainly be more fun if everyone else in this business would keep their word and do what they said they would do but we can only do so much to make sure that others will perform. The key is to try to anticipate any problems and be quick to solve them when they do come up. An entrepreneur will be successful if they are incredible problem solvers!
As always, we are looking for great partners, investors, buyers, and sellers so if you know someone who would like to work with us please reach out to us or leave a comment here! I realize this post isn’t the sexiest house flipping post, but I hope that it shows you the real struggle as an entrepreneur and business owner. I will also say that every GREAT business goes through these struggles at times and if they are able to come out on top they are better because of it. And that is exactly what we will do!
See you all next time but before I go, where are you on the roller coaster? Fortunately, I’m back in the RELIEF phase again! For now…