C Tann-Starr's Outside Blog

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What Kind Of Investor Are You?

Everyone who knows me is aware of the fact that I am a huge Donald Trump fan. I like the Trump University website and find them very interesting because of their think and do approach to investing. Today they have me wondering what type of investor I am... 

When you are working with scaled down resources you have to stop what it is you think you are doing long enough to figure this out. It's a huge mistake not to. Seriously. Warren Buffet figured it out. If it's good enough for Warren and Donald then my premise is that one may no longer assume the information isn't useful because he or she is not flinging millions at a project. If an astute Realtor figures it out before you do you may find yourself off on an adventure you did not anticipate. Depending upon the professional you retain, this can be a good or a bad thing, so you may want to get comfy so you can take a moment to figure this out. 

Like discovering one is an Alpha Male or Type E Personality, the type of investor you are colors what you decide to do when you finally get around to allocating funds for your project. Will you, as a buyer, be an owner occupant? Do you embrace the cash flow model and seek a continuous streams of income? Are you seeking tax shelters? Do you think your bottom line is capital growth? (Capital Growth is the biggie in residential sales. Did you know that most homeowners seek this sort of return on their investment not realizing they are engaged in this process? 'Tis true - LOL)

Turns out that I am an amenity purchaser, which sort of tweaks the above points a normal investor would be driven to accomplish into a different direction. My motivation for investing in land has to do with the location of my loved ones first, then I overlap into the regular investment considerations of best use, possible subdivision, sustainability, utilities, recreational versus residential rental, flipping the project, etc. 

As Realtors we have to keep in mind that investors generally value properties for their rates or return, and amenity investors add that extra quirk of desiring a property to fulfill a specific business need (e.g. like location). There really is a distinction that drives them. They can also overlap, so don't be fooled into thinking you have your buyer and seller pegged. You will have to listen very carefully to what a client is saying to figure out the two. It may require you to actually asked a few astute questions rather than assume (LOL). I'm, just sayin' ;-)

 

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Comment balloon 8 commentsC Tann-Starr • June 15 2009 06:33AM

Comments

C - I am at the point where I am becoming a bit more conservative in investing, moving more towards income, for myself. But, I have been dealing with a couple of amenity buyers lately in regard to land. Not only do you have to listen, you got it right, you have to ask the pertinent and probing questions.

Posted by Mike Saunders (Lanier Partners) about 9 years ago

C - we've got to start listening to our investors so much more carefully.  I have one who's looking for a cool place where he can live above the store.  And the store might be some combination of a restaurant and dive shop.  Oh, and in one of those emerging neighborhoods that will be totally cool in a few years.  So what's that going to look like?

Posted by Patricia Kennedy, Home in the Capital (RLAH Real Estate) about 9 years ago

I used to be a cash flow investor. Bought lots of homes, rented them out and, after a few years, sold them for a tidy profit. But I'm not willing to invest that kind of energy anymore; I don't want to do property management and don't trust anybody else to do it for me. LOL.

Maybe I should buy land. :)

http://shortsaleagentsacramento.com

Posted by Elizabeth Weintraub Sacramento Real Estate Agent, Top 1% of Lyon Agents, Put 40 years of experience to work for you (Lyon Real Estate) about 9 years ago

Big Mike, my buyers are making my life very interesting. I learn something new and useful every day. :-)

Pat, I like your buyer. My first step would be to go to a company that spends a lot of time studying demographics like Starbucks. I would find out where the new ones are opening in your jurisdiction and where they are closing branches. "X" off the areas loosing shops and migrate towards the areas gaining new locations. Starbucks has a reputation for investing in emerging growth areas. So does Walmart and Target. Collect the "opening soon" information from their corporate sites to pick your investment areas to explore then do a drive by to see where the smaller combination/mix use units are in relation to pending development. We have a deli with a two, three, four or five family combo in New York I would show your buyer if he were here. Go find your particular type of mixed use combo Mom and Pop district near the targeted businesses looking to expand into your area. That's how you make this particular buyer happy. Being able to explain the value of what is currently there with the tease of the well known brand that will bring further jobs and business into the area. Use corporate press releases to their full advantage. Show them your version of an individuals investor's economic development plan. I'm always lurking on corporate web sites and find including their press releases with my assessment of an area to purchase quite useful. Especially if you discover what type of shopping your client likes. Cosco? BJs? You need to know this to weed out areas they might not find as favorable as those who have their targeted shopping. Pending stores will help you introduce buyers to potentially attractive investment spots. 

I remember when no one wanted to live where my parents retired to. It was just farmland. Then they started building a Federal prison and people flocked there in droves. Then they started talking about widening the highways to Myrtle Beech, so Starbucks expanded their holdings, other businesses followed them, golf courses appeared out of nowhere, KB Homes hooked up with Martha Stewart and now we have gated plan unit developments all over the place. Follow Starbucks and the companies that do a lot of demographic studies. They follow the money so you should follow them. :-)

 

Posted by C Tann-Starr (Tann Starr & Associates, Inc.) about 9 years ago

Elizabeth, my love, do buy land. God made dirt and it rarely depreciates. It gives you time to figure out what you want to do later on down the road. I love learning how to develop my little projects. Looking forward to breaking ground on the gas station in Salters with the family (LOL).  ;-)

Posted by C Tann-Starr (Tann Starr & Associates, Inc.) about 9 years ago

C --- really, we Realtors need to "listen" to all of our clients, but you are right --- especially the investors.

Mama Liz's Signature

Posted by Liz Loadholt, Realtor--Broker-in-charge - Trainer--Relocation Director Covering SC (Liz Loadholt- AgentOwned Realty- Covering SC) about 9 years ago

Liz, they can open a whole new door for you if you can figure out how to get them what they want in a reasonable amount of time. A gentleman in my office is so good at this he closed a commercial deal in three days. An all cash buyer is a beautiful thing but sometimes they don't tell you they are capable of doing that (LOL). Gotta watch how you treat people. :-)

Posted by C Tann-Starr (Tann Starr & Associates, Inc.) about 9 years ago

Hello Everyone : -),

My name is Undine Doret, I am an first time Real Estate Investor that is willing to bring a great deal to the table for any investors that are looking for great deals.

If you are an Investor that is out there looking for good deals and is willing to create a win-win situation for everyone involved, Then you don't have to look any further.

I can be the person that can  and will bring opportunities to you.

If you are interested, you can reach me at: undine.doret@gmail.com

Posted by Minerva Doret (GBU Team) about 9 years ago

Participate