In the Summer of 2005 I was liquidating a big percentage of my Real Estate holdings in Sacramento and preparing for a new real estate venture in Texas when the market corrected itself. As the market in June of 2005 started to get crazy and bidding wars were never ending, I was all pretty much cashed out of the market. In November of 2005 all the gurus of real estate investing started to realize that, that summer was the peak in the market and things were heading for a cooling off trend. At this same point, the Sacramento Bee interview me for my take on the market. My feedback to them was the market was heading for a double digit correction downwards. I simply said there were to many “players” in the market and when everyone claims to be an “expert in investing”, thats when its better to steer from the crowds.
I was giving this advice to my freinds but in June 2005 to everyone I new that was in the market but most people were to caught up in the market and simply wrote it off as not accurate advice or sound enough. Nevertheless, I felt the market was gonna drop in the 20-25% or more and as I was being interviewed. Even as was stating this in my interview, I was steered to maybe offer a lower percent correction to be conservative and thats what was printed.
My point is this, when you are in business and you have a intuitive feeling inside you thats telling you something, please listen to it, especially in real estate. Investing in real estate can be a roller coaster ride and you have to have the knowledge, stamina and stomach for it in the up and down markets. Always listen to your own instincts if you have analyzed all the information. Don’t always look at what the situation is at the moment but look at what it will be later, and that my friends is what makes you a champion in real estate investing or in any business. Champions have to have two things in any business to make it, “skill and will” but they must have more will than skill to make there investment decisions succeed and to never quit. Had I listen to all the crowd and dismissed my instincts back then, my situation would be alot different now. Trust your instincts because in the end it’s you versus the market.