The Defining Refining of Your Criteria

mean? It's the difference between saying you're looking for an "investment property" and saying you're looking for a "well-kept three-bedroom, two-bathroom single-story brick house with a two-car garage that was built in the last 10 years and that can be bought below market value." If you're going to invest in real estate, you need to be clear about what you want to invest in—that's your Criteria.

Having no Criteria leads you anywhere and everywhere but in the end leaves you nowhere. Having Criteria leads you where you want to go. Having specific Criteria allows you to narrow your search and develop expertise about the kinds of property you want to invest in. Millionaire Real Estate Investors have clearly defined Criteria. In fact, they have two sets of Criteria: what they will consider and what they will buy. The first is somewhat general, and the second is very specific.

The great thing about your Criteria for what you'll consider is that you can use them to narrow your search in two different ways. You can put them at the front end of your lead generation, thereby receiving fewer but better leads, or put them at the back end and thereby receive more leads but of less quality. Either way will work, so experiment to see which works best for you. In the first instance your "what you'll consider" Criteria serve as your filter on the front end, and in the second those Criteria serve as your filter on the back end.

Two Kinds of Criteria

1. Criteria for "What You'll Consider"

2. Criteria for "What You'll Buy"

"You need to set parameters and treat your business like a business."

Anna Mills Millionaire Real Estate Investor Toledo, OH

Here is where your Criteria for what you will buy kick in. Because some of your leads will be suspects (unqualified leads) and some will be prospects (qualified leads), having well-defined Criteria for what you will buy allows you to reject suspects and focus on prospects quickly. You will learn that working with suspects instead of prospects costs time and money and for the most part is not very productive. Thus, your lead generation in the end must include a qualification and elimination process, and that's what your "what you'll buy" Criteria will do for you: filter and eliminate the suspects and identify and qualify the prospects. The reason you would rarely do lead generation with your "what I'll buy" Criteria is that your search could be so narrow that you'd miss some great opportunities. That's why you start with the general announcement "I buy houses" and then narrow it down with "I buy houses that meet my specific Criteria."

This sorting process is one of the best ways to develop expertise in the kinds of properties you've targeted. Every property you see, every suspect you eliminate, every prospect you investigate, and every deal you ultimately make increases your knowledge and refines your Criteria. Think

Criteria: Location, Type, Economic, Condition, Construction, Features, and Amenities. The first three—Location, Type, and Economic—are foundational and are the most important. Let's take a look at those three.

"I think one of the very first things people have to do, and then periodically review to see if it's still true, is determine what kind of property they want. They need to establish their Criteria and hold them in mind while they search. Then when a good deal comes along, they'll recognize it as a deal because it meets their Criteria."

of it as "on-the-job training." But in the end your best deals usually will be those that most tightly conform to your strict Criteria. You might even say, "The deal is in the details."

Dyches Boddiford, Millionaire Real Estate Investor Marietta, GA

There are seven major categories you must make decisions about to define your investment property

Your Real Estate Investment Criteria

Figure 32
Brains 4 Business

Brains 4 Business

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