It’s hard to believe that we’re already done with 2008. It seems like just yesterday that I was writing my 2008 goals, and looking back, it amazes me that we were able to accomplish as much as we did in 2008.
I’ll go into more detail on our 2008 success (and goal reaching) in another post, but this one is about setting goals for the upcoming year. While I’m not a huge fan of annual goal setting (things can change quickly and often over the course of an entire year, so I’d rather set monthly or quarterly goals instead), the process of thinking about where I want to be a year from now is tremendously valuable.
In 2009, my wife and I are excited about branching out and including many other facets of real estate into our investment business. While 2008 was all about building a team and learning to flip houses, 2009 will be all about building an investor network and learning how to make money in other aspects of real estate investing. Don’t get me wrong, we’ll start be flipping plenty of houses (our “bread and butter”), but we recognize that there are other aspects of investing that have even higher ROI, and may be better suited to short-term cash-flow in this crazy market.
I’m hoping that the extra work we take on won’t spread us too thin; we now have three full-time employees in the business (my wife, my brother and myself), and we’re hoping to add at least one more this year. If we’re smart, we should be able to accomplish a tremendous amount with 4 full-time employees; if we can’t, this is an indication that we’re not being smart about scaling our business.
Now for some details…here are our 2009 goals:
- Update the Business Plan
- Create and Execute a Detailed Marketing Plan
- Build a Strong Investor/Retail Buyer Network
With the expansion of our business model in 2009, we will need to once again focus a signficant amount of effort on our business plan. In 2008, the business plan we created went a long way towards guiding our strategy and helping to make us successful in reaching our goals. In 2009, we a much more aggressive set of financial goals, a strong business plan is even more important.
To be successful with the other goals we have laid out for ourselves, we will need to focus a significant amount of effort on Marketing, and in some cases, Internet/Online Marketing. So as not to pigeon-hole ourselves with this plan, I won’t say much more here, but I imagine that our Marketing Plan will detail both online and offline marketing aspects, including print marketing, building a professional website as a landing point for our networking efforts, building an online methodology for finding both investors and retail buyers, and perhaps even hosting investor/buyer conferences and seminars.
Many of our income-producing goals for 2009 revolve around finding other investors and building a buyers network. In 2008, we were strictly focused on rehab and resale; in 2009, our focus will extend past house flipping and into wholesaling, consulting, and other aspects of investment real estate. To be successful, our networking efforts must succeed.
Specifically, to support our financial goals, our networking efforts must succeed in at least the following:
- Build a Database of 50 Investors or Potential Investors
- Build a Database of 50 Pre-Qualified Retail Buyers
In 2008, we built a strong team of contractors, agents, personal lenders, a CPA, etc to support our rehab and resale business. In 2009, we will be focused on additional aspects of real estate that will require support of additional team members. Specifically, we’ll be focusing on wholesaling properties, staging properties, and consulting for other investors. These aspects of the business will require a whole different set of team members, including:
Specifically, this goal will include:
- Finding an attorney who can write our RE contracts
- Finding an attorney who can support our creative RE needs
- Find a title company that can facilitate our wholesale deals
- Find a set of lenders who can support our investors we work with
Now that my wife has her real estate license, we have an opportunity to make additional income by facilitating transactions for other buyers, sellers, and investors outside of our own Lish Properties business. On a typical $100K deal, my wife will earn over $2500, so doing just 20 additional transactions next year for buyers, sellers and/or investors other than ourselves should generate at least $50K in additional income. While not life-changing, this income will cover our personal expenses for the year, and allow us to reinvest all additional income back into the business.
My wife’s main goals for 2009 revolve around building a staging business for other investors, as well as for other retail sellers. This is a strategic business area for us, as we see staging as an up-and-coming growth area of investor real estate. Additionally, we believe that if we can establish a business and business model around staging now, we’ll have huge opportunity in this area once the market turns and investors begin flowing back to real estate in the coming years.
In 2009, we hope to both build a portfolio and build a reputation as a premier resource for local investors interested in staging their houses. While staging may not generate a large amount of income in 2009, we expect it to play a key role in our business, allow us to support other financial business goals, and position us to make signficant income from this activity in 2010 and beyond.
The basis for success in our business in 2009 will still focus on generating income from real estate transactions, whether those transactions be flips, wholesale deals, or purchasing rental property. In fact, in 2009, our goal is to successfully tackle all three of these real estate areas, to varying degrees.
Specifically, our transactional goals in 2009 will include:
- Purchase, rehab, and resell 12 houses, averaging $15K per flip
- Wholesale 12 houses to other investors, averaging $5K per deal
- Purchase and hold 6 rental properties ($15K equity, $100/month CF)