Darrell Hardy, Editor of Success Magazine, says that innovation is the process needed to take companies and people beyond “the competitive herd of the masses and status quo”. The information age, bridled with the sweeping changes in the economy, is forcing investors to look at real estate through different colored glasses. History has proven that savvy investors that are willing to create a new mindset during challenging times are rewarded when the market changes. Here are a few ways that innovation will help you create survival skills for today’s real estate market.
Develop a new mindset.
It is easy for us to sit around at the real estate investor’s meetings or over coffee at Starbuck’s and talk about how great real estate investing was before 2008. The reality is that it is still great in 2010…if we decide to make it so. We have to develop a new mindset that uses innovation to create successful deals.
Being an innovator translates into looking at real estate and not seeing only “what is’ but “what could be’. A good example would be locating a great deal on a property which has numerous duplex apartments. They are bank owned and have been vacant for months. The property is located adjacent to single family homes but the history has been that the rental tenants were not a good mix with the residents in the neighborhood. Although the annoying tenants are gone the homeowners are now faced with boarded up buildings and tall grass. This unquestionably affects the value of their homes and is not attractive to potential buyers. An innovative idea would be to see the property being transformed into a beautiful upscale senior housing complex. It would improve the area, supply a housing need that may not exist in that area and would create an income producing property for the investor.
Be a student of your target area. Learn about the housing needs of the residents in that area. Explore the demand in the market for single family homes or is the area one where rental homes and or apartments are needed , What amenities do buyers and tenants want in a home or rental property?
Applying innovation to your real estate business will allow you to offer increased value to your properties in ways that results in your property being more competitive with others in the same area.
Consider creating a team of investors that target a neighborhood that is in need of revitalization. Work as a team to transform the housing stock in that area into affordable and desirable homes that will be inviting to families, create neighborhoods and attract new business to the area. This has been successfully done in many communities. The No Da inter-city neighborhood in Charlotte North Carolina is an excellent example of using innovative ideas to create an area that is in high demand and where property values have soared. It offers charming vintage homes in an urban area combined with small shops, cafes and light night life that attracts buyers within a certain target market.
People appreciate someone listening and understanding what they want in a home and neighborhood. When you are aware of the needs of the buyers you have the opportunity to offer a property that fills their physical wants and needs and also will positively impact how they live. You have increased the value of the property not only in terms of “dollars” but also the perceived value generated by the way the property makes the buyer feel.
Surviving today's real estate challenges requires innovative thinking , readjusting our approach and looking for positive outcomes that we may miss if we settle for the status quo.