Navigating the real estate market can be difficult and an overwhelming percentage of investors make poor decisions and eventually lose money on investments. The premise of failing causes a huge amount of potential investors to never completely invest in an opportunity, and their trepidation is understandable. However, a huge profit can be made by those who make intelligent decisions and manage their assets wisely.
Many investors start small and invest in low cost investments or single pieces of real estate that will eventually create revenue. The strategy is sound and clearly involves fewer risks, but the rewards also take longer to materialize. Weighing risk versus reward is always important when investing, but those looking to turn high profits quickly will find that taking low risk investment avenues will not result in the growth that they desire.
The hugely successful investors and real estate businessmen are those who make intelligent decisions that often involve higher initial investments. Gene Phillips, the incredibly successful Texas-based real estate manager, brought together $20 billion in over 1,000 properties and finance companies. Then, by using $15 million in 1979, Phillips became the majority shareholder of the company Southmark. Phillips pushed the company to become a $17 billion conglomerate within 7 years with his initial investment, reaping huge success based on his lucrative and intelligent decision almost a decade earlier. While most investors may not have the capital to put together such large investments, the success of Philip’s 1979 decision shows how bigger risks can reap the largest rewards.
While there are always times when discretion is the best path towards success, investors have to be aware that taking a large risk may be necessary during their career. While most will never reach the level of Gene Philip’s success, his model and intelligent investment strategy can be used across the real estate investment industry