Sensi (Sean) Gilliland, Black Belt Investors, Talks About Real Estate Investing in new interview with Business Innovators magazine and California Business Mavericks.

BB: What is the common obstacle from people achieving their outcome that you find?

SG: Well you know what, I mostly deal with a lot of people and I hear a lot of things like I don’t have time and I don’t have money or I have to talk to my spouse or they come up with a lot of excuses and that’s what they are excuses. What it really boils down to is fear. Fear of the unknown, fear of am I gonna lose a dollar, fear of what if I mess up, fear of success. I have many people I work with that have a fear of success. And, I think fear is the biggest obstacle for most people. Now, to be able to get over that fear you need to put faith in front of fear. You have to have some faith and to be able to get comfortable in that faith I think you’re going to get into the real estate world and to get comfortable to where you can pull the trigger you need to educate yourself. It always boils down to education, now, education is not everything because there is a lot of people, for instance, that comes to my real estate clubs that are very, very knowledgeable in real estate. But, knowledge is just information. The difference between them and someone like us is that we have wisdom. Because we take that knowledge and put it into action and create that wisdom. So, if I’m consulting with someone that has a fear of moving forward whenever that niche their interested in they really need to hone their skills in that niche. You don’t need to know everything maybe you’re going to be a landlord you don’t need to know everything about land lording but you should have a solid foundation so that you can understand the components that go along with land lording so you can make an educated decision so I think it boils down to getting over that fear is to get that education, get some counsel with that education and start taking some action.

BB: How do your help your client analyze their path whether being a landlord or doing a flip?

SG: It’s pretty easy a lot of people come to me and say I want to be wealthy; I want to be financially secure. I totally understand we all do – right? But, you know they come to me saying they want to own rental properties because that’s where they see the wealth building aspect comes into play. But, I find that a lot of people don’t really need wealth building education or knowledge but what they really need is a paycheck and so know you real estate is divided right down the middle. We know what we want but we got to focus on what we need and a lot of people need paychecks and there are some people that don’t need the extra paychecks they actually want to build the wealth for their financial future. However, either way whether you’re buying, fixing or flipping properties you have to analyze the deal. And, if you’re going to buy and hold properties you also need have to analyze the deal. Now, I tell everybody we always make our money on the purchase not on the sale. I am a wholesaler at heart and that’s where Black Belt Investors is founded. And, a lot of people think wholesaling is all about assigning contracts  and that is incorrect if you are someone who wants to flip properties without the use of cash or credit and assign contracts  over  to another investor than yes that is a form of wholesaling. If you’re a rehabber that buys, fix and flips because that is your value add of retailing a property then you are also buying at a wholesale level, you must buy with an equity position. And, if you’re a landlord like myself, well, I like to make sure that I make money on my purchase so I am going to buy rental properties on the wholesale level. Either way what is important is in evaluating the deal is not just the numbers of what are my returns and that is what I think a lot of people go wrong. They just look at the numbers of returns, okay, if I put x amount of dollars in this property and I do this type of maintenance and I have holding costs and possible an HOA and I’ve got insurance, utilities and repairs my return will be x% or x amount of dollars. That’s an important aspect obviously to be able to analyze a property but that’s not the only thing you want to analyze see, we always need to know how to get out of property before we get into a property. And, even though a property seems to perform well on paper, I always ask what is the local economy doing, where are you buying, is this a economy in a revitalization stage is it stagnant, is it regressing, is it progressing, where are we at with this because you can buy something that is very appealing in regards to the numbers but, are you really going to be able to collect rents. If you’re going to buy fix and flip are you going to be able to retail it out because maybe you are in the wrong neighborhood you may be in the area that is predominant landlords and renters which are looking for either rental property or property at a wholesale rate? But they’re not looking for something at retail. So, I find a lot of people get stuck and lose money because they are focused in the wrong areas. They are only running the numbers on the subject property but they’re not running numbers on the local or county’s economy. And, so with that it is very important that when an investor comes to us we take a look at everything that surrounds that subject property to make sure that were able to make our money before we purchase and to be able to exit out of the property whether it’s going to be a fix and flip in a good amount of time. Or, if you’re going to be a landlord and if you need to liquidate – can you liquidate? That is the important question to ask.

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Beverly Boyko

Contributing Writer, Journalist, and Independent Publisher, Owner of Optima Publishing and California Business Mavericks Magazine