Sacrifice: A Real Estate Investor’s Magic Bullet
A few weeks ago, THIS article made its way across my desk via facebook. For those of you who haven’t had a chance to read the article, the long story short is that an investor by the name of Bill McMachen purchased 627 foreclosed homes at the Macomb’s county tax sale.The headline is what immediately caught my attention. After all, 627 units is a lot of property, especially for ONE transaction! I found myself a little envious of McMachen. To snatch up hundreds of properties for roughly $7,500 a piece is an amazing deal.However, I’m not writing this post merely to toot Bill McMachen’s business sense. I’m writing because I wanted to shed light on the most interesting aspect of the article – the comments. You don’t have to look too far down the comment portion of the page before you read things like: “…The only way I can condone this is if this man uses this large housing stock to return the houses to those who need them – not to benefit him, but to benefit them.”“I was hoping the article would read that he bought these homes to help the poor, instead of helping himself to their misery. I am also disappointed, to say the least.”“… it is disgusting that you people out there who try to take advantage of people who did not initially have things handed to them!!…”“Just another case of GREED. He already has big bucks but wants more and more.”“So the vultures who were planning to buy the homes of down-and-out folks, were beaten to the punch by an even bigger vulture? Hope they all go to Satan’s fiery pit on an express train.”“Why aren’t both of these men in jail?” What frustrated me about these various commentators is that they don’t consider the other unspoken sacrifices that may have been made to acquire the $4.72 million to purchase these properties.
The article states that Mr. McMachen was a business owner of a yacht dealership and while I don’t know his story personally, I do know that many entrepreneurs endure years of long work days, personal checks written to pay staff and high periods of prolonged stress. Unfortunately, none of these commentators took these into account.As I look at my time working in the rental business, I realized that I’ve also had naysayers and “haters” come across my path. The tricky thing is that these folks don’t typically make statements as blunt as the commentators did in the above mentioned article.For example, I remember a recent interaction in which a relative was discussing their struggles with paying their monthly bills. I harmlessly asked if they had considered creating a budget. The response to my question was, “We’re not like you; we don’t have money just lying around.”I think the perception is that people who are successful in real estate are plain “lucky.” While that may be true for a few, my experience has been that investors who have any type of successful track record in this business has been by design, not chance.