At a real estate conference a while ago, I had a bunch of people come up and ask me about the economy, where I thought the market was going, and even about some little neighborhoods in the Rockaways where they were looking to buy. That’s pretty normal. I’ve been in the real estate investing business for a long time here in New York and I like talking about it.
So many people were coming up to me asking about real estate that a friend who was with me said I oughta call myself a guru. After all, people love their real estate investing gurus. It could be, he said, my brand.
Needless to say, the conversation went south from there.
See, I like expertise. I love talking to experts. But I am a little leery of self-styled gurus, and frankly, you should be too. Because here’s the thing about New York real estate gurus: they claim to offer “secrets.” There aren’t any secrets to achieving your goals in this business. There’s only hard work, connections, and know-how.
So let’s take a look at the different types of New York real estate gurus you’ll likely come across, and why there are better ways to spend your time, money, and attention as opposed to listening to them.
The Types of New York Real Estate Guru You’ll Find in the Wild
You go to any real estate website, convention, event, and you’re going to hear about the latest industry gurus. You do a Google search to see how flipping houses could be your career and you’ll get a lot of results from people guaranteeing you success.
And it’s tempting! It’s tempting to think that a few afternoons in a Marriott conference room, nibbling on some stale rolls, will lead to riches. You may arrive at the event just a kid from the boroughs and come out ready to take Manhattan. But that almost never works. And it doesn’t work because each guru is peddling their own particular blend of snake oil. Let’s take a look at some of them.
The guru telling you exactly what the market is going to do
When I write this we’re in a strange pandemic-induced recession. In some ways, the recession is an excellent time to invest in real estate. Despite the state of the economy, there are still ways that you can come out on top. How? Hard work, flexibility, and the ability to adapt to changing conditions.
What’s a good way not to come out on top? Having absolute certainty.
Someone who tells you that the housing market is “definitely” going to go up or the bubble is “absolutely” about to burst or that “everyone in Brooklyn will be buying in September” is, well, ridiculous. There are too many variables. How many of these folks were predicting the pandemic?
Instead, you need to have the knowledge, the support, and the materials to thrive in any kind of market. Don’t make assumptions based on an inviolable model.
The guru telling you what kind of house you have to buy
I went to a seminar with a friend in Queens last January. The topic was the rental market and the incredibly high rental rates across the city. Queens, in particular, was at an all-time high, with average rents over $3,200. So the message? Buy investment properties. Convert any fix-and-flips into long-term holds. Luxuriate in the kind of passive income that will make your great-grandchildren bless your memory.
Of course, that’s not the case. The pandemic meant the rental market completely crashed. Rental prices in Queens are down 5.7% to a median of $2,700. I mean, that’s still pretty pricey. But the point is that the guru has one idea and wants you to put all your eggs in that basket. What if that basket breaks?
Listen, the thing is that no one gets invited to exciting speaking gigs saying “have a diverse portfolio that works for you.” It’s like having a wellness book called “Eat Better and Exercise.” Everyone knows that! So to be a guru, you have to have a shtick. And saying to invest in “One! Unbeatable! Market!” is a good shtick. But unfortunately, it’s not very good advice.
The guru telling you exactly where to buy
I don’t know if you’ve ever walked around, but New York is pretty big. It sometimes blows my mind that Great Kills and Fort Greene and the Upper East Side are in the same city. It’s what makes this town so amazing—the diversity, the possibilities, and the promise.
Of course, there are hot areas, up-and-coming areas, and areas where you want to get in on the ground floor. But the problem with centralizing in one guru-blessed area means you are competing with other businesses as prices are going up. And what if it is a bust? It’s another all-in strategy that sells seminars but doesn’t always reflect the reality on the ground.
The guru telling you the key to close every deal every time
One of my big pet peeves is the kind of self-help book that gives you the exact right way to behave in any social situation. And it’s true: when you read a book like that, they paint a situation and guide you through it perfectly. The problem is, they get to set all the parameters. It’s not like that in real life.
It’s the same with some New York real estate gurus. They want you to believe they have the one trick that can convince anyone to sell to you or anyone to buy. But people are unpredictable. They come into a situation with their own unique circumstances and history. They have their own needs. They aren’t a target into which you can fling your most persuasive, market-tested phrases.
Empathy. Understanding. Patience. Honesty. That’s what works. That’s how you can possibly close a deal that is fair for everyone involved. It works differently with every person. You just have to see them as a person.
The guru who simplifies everything
This one is a no-brainer. I was recently reading an article about a NewYork guru who said that this was “the ultimate city for luxury.” Well, yeah. It’s super expensive in some parts and in some parts it is not. But this person reduced New York to a catchphrase, which is both so obvious it isn’t worth saying and so reductive that it barely makes sense.
That’s pretty worthless. So before checking out a guru, make sure that their advice isn’t the barest basics. Honestly, I’d almost rather have a flim-flam man tell me that the key to New York real estate is buying land on Ellis Island than pay a few thousand to attend a seminar and have someone tell me to buy low and sell high.
The guru with all the backing
There are a lot of famous gurus who have a lot of money, and they showcase how wealthy they are and say that you can be too. But look into these people. Chances are they are:
- Independently wealthy and went into real estate investing just to make more money (especially by charging people like you and me to hear them talk)
- Backed by financial institutions and have other people’s money to spend
- On a TV show and backed by a network, who might not buy the houses, but has an army of people to make their choices work out
The difference is that these people don’t have risk, or at least, far less than the normal investor. So they don’t understand. And that makes it dangerous, especially because they seem like they’ve made it. But it’s easy to make it when you’re already there. These are guys who were born on third base and want to charge you to learn how to hit a triple.
The guru telling you how to get rich quick
Anyone who says you are absolutely going to get rich quickly is lying to you. I mean, maybe you’ll discover a mansion in the middle of Brooklyn that had somehow gone unnoticed. But chances are you won’t.
Most gurus listed above will offer some version of this. They want you to believe it’s easy. They want you to believe that if you just listen to them you can beat all the odds, outsmart the market, and never have to work again.
But this job is hard work. The market is usually pretty correct. Your margins, if you do it right, will be healthy. You’ll accumulate. And you can potentially be very successful. But quick and easy riches? That’s not in the cards.
So how do you play it right? There’s one good way I know.
Get Ahead in New York Real Estate Without Gurus
You might have picked up that I’m not a huge fan of gurus. I tried to be subtle, like most New Yorkers, but you might have caught on. What I like is a solid backing and steady support. I like things that actually have value. And that’s why I like being an independently owned and operated HomeVestors® franchisee. See, HomeVestors doesn’t make outlandish promises. Instead, the nationally-famous “We Buy Ugly Houses®” campaign helps franchisees get leads from people who are ready to sell. Industry-leading proprietary tools help with house valuations and finding great hard money rates. And, the training and mentorship programs available are invaluable.
Mentors, to me, are the opposite of gurus. They listen to individual cases, they know you as a person, and they take your situation into account. They give advice based on years in the field, to help you talk through your business needs. It’s not them speaking from a stage to hundreds of anonymous faces. It’s a conversation with someone who has been there.
To me, that’s the most important thing. I am glad to help people in this business, but not to lecture them, to actually work with them. That attitude, the anti-guru mentality, is the best way to learn how to succeed. If you want to avoid the latest New York real estate guru and join the HomeVestors® network that gives you actual support, request information about becoming a franchisee today.
Each franchise office is independently owned and operated.