I believe there are few things more important to your success as a real estate investor than credibility.
When it comes to raising money for your deals confidence and credibility make a dynamic almost unstoppable duo. When it comes to negotiating your deals and hiring your team, credibility makes the whole process go a little smoother. Whenever someone has to decide whether to do business with you – in ANY capacity – credibility plays a big role in their choice.
I recently read a formula for credibility:
Expertise + Trustworthiness = Credibility
(Thank you Kevin Hogan for this!)
So how can you create credibility no matter what your level of real estate investing experience? I have a lot of ideas and suggestions on this subject, and will be expanding on each of these at our upcoming Joint Venture Presentation Workshops, but here are 5 simple ones you can begin to apply and use now:
1.Practice What You’ll Say:become a clear and concise communicator. You must know your subject matter (your deals, your market area and your strategy). You must be able to communicate this without stumbling on your words or following a written script. Have a few key stories, words of wisdom and tidbits about what you do that you can deliver quickly and clearly to anyone interested in learning more about the business of real estate investing that you’re in.
2.Back Up Your Statements:Credibility is quickly established when you can show that you’ve done research and you’re staying on top of what is important to you as a real estate investor. For example, instead of saying “the city is growing and the rent rates are increasing” say “According to research conducted by Ipsos Reid, there are 50,000 new people moving here every year. And CHMC just put out their annual rental rate survey and rents in this area have gone up 8% year over year.”
3.Smile: I’ve talked about this before but experts in persuasion like Kevin Hogan and Robert Cialdini all suggest that you need to be likable to be credible. If people don’t like you it will be much harder for them to see you as credible. I think one of the easiest ways to be liked is to smile and be friendly.
4.Shine the Best Possible Light on Yourself: In other words, find a way to present the expertise, education and experience you have in the most positive way. I could say that I am a real estate blogger, but anyone could be a blogger. Instead I say I am an award winning blogger (because I have in fact won several blogging contests). Instead of saying you own two properties you could say you’ve been investing for four years (assuming of course you bought them in about 4 years ago). Find a true and authentic way to take what you’ve got and present it very positively.
5.Borrow Credibility: When we did our first rent to own a lot of prospective tenants asked us how many we’d done. We simply said “we’re working with two guys who’ve been involved in hundreds of rent to own deals.” That was true, Nick and Tom Karadza had been involved in a lot of rent to own deals and they were coaching us through our first. If they pressed we would tell them it was our first but most just wanted to be sure we weren’t making this whole thing up. We weren’t going to lie but also wanted to provide assurance that we knew what we were doing. If you’re working with a coach – borrow the credibility and experience of the coach.
Remember being credible is nothing more than being believable. It’s an important part of being persuasive and being a person people want to do business with but it’s not nearly as complicated as we make it out to be.
Become a market area expert and be trustworthy. Neither one requires you own a certain number properties before you become credible nor does it mean you need an MBA or masters in anything. Build your expertise and be trustworthy. Credibility will follow.
And if you’re wondering what to do to build your expertise, here’s a few resources that might help:
Market Research Checklist:
Questions to Ask Before You Buy a Condo:
Housing Boom? Housing Slump? Housing Recovery?
Published October 14, 2011