Lessons - The Warning Signs That Would Have Saved Me Millions | David Greene - Fmr BiggerPockets Host & Bestselling Author

In this lessons episode, explore the truth behind real estate success, and why shortcuts often lead to costly mistakes. Discover how misleading narratives and core sellers profit from selling outcomes instead of skills. Understand why mastery, discipline, and skill development are essential to building real wealth, and uncover how to identify red flags and make smarter decisions when investing in education. Let's talk about what's sort of petled online in terms of real estate courses. This is probably one of the biggest pain in your asses and you deal with every single day when you speak to people. But when you look at the people, there's a couple different things. You look at people that have figured it out one way, and maybe they've gone through a lot of shit and a lot of failures that they're not speaking about publicly. Maybe they actually haven't even figured it out to the degree that they're alluding to online, and they're making a lot of money selling courses. That's another issue. But the point is you still will not respect the process compared to if you're putting your own money in, which is why I love sort of just the framework that you teach over to people. But what are some of the false stories, false narratives of what real estate success looks like? Well, everybody, my friend Brandon Turner has a really good statement. He says, nobody buys a drill. They nobody wants a drill. They want a hole. You buy the drill to get the hole. Nobody wants to learn how to put the work into investment real estate. They want financial freedom. They want to be rich. They want to not have a job. They want to they're sitting in commute traffic and they're pissed and they hate it and they want a way out of it. Okay, my my experience in life is that the only way you get out of a situation you don't like is that you rise to the top and you earn the right to get in a better one. In everything in life, if your spouse isn't happy with you, you don't have a good relationship. The only way to fix that is to change the things in you that make it hard to be a good partner, bad a thousand, and now your spouse usually starts to feel guilty. I'm not married, but I see this in marriage all the time. Like, man, they're showing up every day and I'm not. It puts pressure on them to do the same thing. If you get into the, I'm going to make threats like, well, all be a better husband when you're a better wife, it never works. It becomes a race to the bottom. Work is like that. You can't, as a basketball player, tell the coach, I'll play harder when you give me more playing time. You have to be showing a lot of effort and practice and improving to earn. That is the order of the world. Okay. Like, it is naturally a meritocracy, even though we live in a society that sort of does a misdirection to try to make you believe that's not the case. It's still a meritocracy. When I decide where I'm going to go for dinner, I don't ask what the most mediocre tacos are. I say, what is the best taco stand in town? And that is how I make my choices. You buy a Rolex because you think it's the best. You buy a Lamborghini because you think it's the best. That's how we all make decisions. And so it's disingenuous to tell people, hey, somewhere, someone out there is going to like your tacos just the way they are. It doesn't matter if they're not the best or they're stale or it takes a long time to make them. You are, they are a unique and special snowflake taco and someone's going to love it. It's ridiculous to think that way. And so getting back to your original question of like, what can you do to, sorry, we'll take this part out. What would remind me what you would ask me? The real estate owner, it was so you went down this really good rabbit hole and there's these things I'll pull out of every single thing you mentioned. And most of it is in the pursuit of excellence. I want to get to that in the pursuit of mastery, but I was saying the false stories around real success. Thank you. What are they? What are they? So what I talk about in my book, there's three pillars. There's chapters on defense, literally the art of tracking your money, budgeting, your money, knowing where it's going, reading a profit and loss statement, having a personal budget and having a plan for every dollar. Then there's a pillar on offense. And this is the skills that you need to develop, the things that people who make money do. It is not, it doesn't just happen. Like people that are really good with with women or women that get a lot of mail attention, it doesn't just happen. There are things they are doing that you could identify and say, this is why they do so well. So there's chapters on extreme ownership and being a leader, taking on responsibility. There's chapters on the process of skill development, the literal process you go through to build skills. I did a TED talk on that topic that if you want to be good at things, here's the path you follow. Like Napoleon Dynamite said, you got to have skills. There's the pursuit of excellence. You have to fall in love with the process of being great because I'm going to go spend my money for the best tacos. I'm looking for the best partner. My friends are going to be the best friends that I think I can get. The pursuit of excellence is how you earn the right to get more money. Now in our space, the real estate investing space, there are a lot of people that are going to sell you on the opposite of that. You don't have to do anything. It should just happen. If you know, it's sort of like a mixed martial artist who trains every day versus a person who says, well, I went to this kung fu place and they taught me the secret ancient art of the five finger death punch. And so I don't have to practice. I know this special technique, right? Well, we know that doesn't exist because there's nobody in the UFC that's doing five finger death punches. That is something that hacks the Jews to get you to sign up for their gym. And they're praying on the fact that there are a lot of people that want the result without having to put in the work. In the real estate investing space, you will frequently see people that are bragging about they quit their job because they made enough money from real estate. And they they have this amazing car because they got it from real estate. But the reality is when I talk to these people, their real estate is not doing much. They're making these money from the courses that they're selling. They're really just really good marketers, which is oftentimes a good synonyms with deceivers. And they're using the money you pay on their courses to fund the lifestyle that they're now selling you. And so the book was written almost as an antidote to that. I don't know any wealthy people who approach things like that. And I do know that it is possible to deceive people and separate them from their money, but not for the long term. Eventually, you get exposed. Eventually, people figure it out. You also have to live with yourself that it kind of makes you my opinion a POS that you're selling a dream to people that's that's not real. Well, you know what you're doing? You're you're selling the dream of what you're that person was experiencing in their commute to work, the not having to work anymore. The I don't want to I don't want to have a W-2 income. I want to have passive income. My most hate word in the world is passive income because it doesn't it doesn't exist like everything. I would have worked really hard to get a great body and then never have to work again in my six pack. Well, it's not how it works. That's just never how it works. And then once people start into real estate listening to people that actually don't know what they're talking about and don't know what the preaching because again, they're making a lot of their money off course sales. Then you have an over reliance on whatever that person is teaching you and you're not looking elsewhere because you're so bought into it and you're now not just financially invested, you're emotionally invested in whatever this person is teaching, which I think is a whole other issue because like religion, like fitness, you you attach yourself to this dogma and you refuse to look at anything else because you're so invested in it. And I think this is a very toxic place to be because now you have spent 10, 20, 30, 40, $100,000 on courses. You have to make it work. So now you're not even going to allow yourself to look elsewhere for other opportunities because you feel like you're failing. That's an investment, right? You invested in the wrong thing and now you're low to let it go. It sort of supports that theory we talked about earlier that when you're invested in something you'll hang on to it, but it can work against you when you invest in the wrong thing. I spent $50,000 learning how to do this technique, but there's not opportunities in the space for that technique anymore or I don't have the skills that are needed. Like in our in our world, that's often wholesaling. Hey, you got no money. That's okay. Put $15,000 charge on your credit card. Buy my course. I'll teach you how to make money in real estate without any capital and they teach you wholesaling, which is basically going and finding an incredible deal putting under contract and selling the right to buy that property at an incredible price to someone else and you get like a middleman fee. It's the hardest way that I know of to make money in real estate. You got to relentlessly go out there and look for people that are trying to sell a home. A lot of the time, not every time, but a lot of the time you're buying from grandma who doesn't know what her house is worth and still thinks $100,000 is a lot of money or you're finding a person in serious financial jeopardy that you're you're taking advantage of in a sense, but you got to have a great mouthpiece. You got to be really good salesperson. You got to talk people into something. You got to make them think they're winning even if they're not. There is a lot of skills at a wholesale or needs much more than a average Joe that just does a good job being a plumber and slowly puts their money into real estate and lets it grow over 30 years. That's a you don't need very many skills to make that work at all, but you got to have some money. So all of these courses that will teach you how to do real estate without money, they end up needing you to have the highest talent level that most people won't have. So then they'll fail at it. But like you said, they'll think, well, I have to keep going because I've already spent the money. And then they get what I call course shame. They sign up for a course. They signed up for a group. It didn't work out. And they internalize it. And there's something wrong with me. I'm the problem. I suck it life. Their confidence takes a hit. They're less likely to go work hard at what they're doing. Meanwhile, the person who left them feeling that way is driving around in the Ferrari that they got from the money that that person spent on their course. It's a vicious cycle. Okay. So what what is I'm curious if there's any other thing because you live in this world. Are there any other major red flags that if somebody is looking to get started into real estate and they're going to go to Google or they're going to go to YouTube and they're going to find all the people that I'm sure you you absolutely ate. So what what are the things without naming names or whatever you do whatever you want to do. But what are the things people should look out for us that they should be wary of that they shouldn't pay for. I mean, we're talking about courses, but there's some education that's useful. That's a good that's a really good question. I don't know that I've ever been asked that. I like that. So a couple of things I would think about is the person selling you on because I don't think there's anything wrong with selling education. It's selling shit education. That's the problem. Okay. Are they telling you I will teach you and a list of what they're going to teach you or are they selling you a result. If you take my course, you will make this much money. If you do this thing, you will get this lifestyle. They cannot guarantee that you can own a gym. You can't tell everyone that comes to sign up for the gym. This is the body you're going to have because that's up to them. You can show them the machines. You can show them the personal fitness instructors. You can show them the protein supplements. You can show the tools that you will offer. You cannot guarantee a result. So if you're being sold on a result first off, that is impossible. That's a big red flag. Another one. And I just thought of this is have you ever noticed Scott that like a very high proportion of influencers and people that sell education or products happen to also be really good looking? You're not wrong. There's not a lot of ugly fat people, right? So my theory would be is we all like looking at good looking people. Part of their success is because of their looks, not what they're teaching you. We just rather hear information from a hot girl or a really confident but I think that's a proven psychological phenomenon. Like I think that it's easier to connect with people when you're you know you're in good shape. You present well. You just you just increase the trust factor almost when you engage. Yes. That is aptitude. So if there you that might be a contributing factor to why they have a great reputation, right? It's odd, but they're really like old ugly fat dude that's teaching you how you're going to make money in real estate. I would probably trust them first. I would that person before like the 25 year old smoke show who's telling you how she's traveling to the Maldives every weekend because of the money that comes from. It's a sniff test. You just look at the Instagram. You look at the Instagram. And again, to your point, they're selling if they're selling the lifestyle. Yeah. Then there's always a I don't know. Just like it's not it's not a 100% hard and fast rule. But if it is like every single post on Instagram has like a hundred thousand likes and tons of comments and they're a million followers and all they're doing is taking pictures in front of different infinity pools around the world. And it's like you start to be like listen. The more that you see their toes or their legs or the pictures of that. Yeah. That's really a little bit of a red flag. No, that's a little bit of a red flag. The real estate space specifically is you'll take a really smart guy that they could teach you how to analyze an apartment complex at a high level. And there's really good information. Okay. Side note, if you're not good with numbers and spreadsheets and analysis, it does not matter how much house mark that guy is you're not going to be good at that job. If you have a huge physique, you're not ever going to be a really good log distance runner. It's just there's a skill set that every human has that they need to find the right match. But you'll find that person who he wears new balance tennis shoes and he tucks in his shirt way too high. And they're not comfortable on camera, but they're really the brains behind the operation. And then they get a very attractive younger influencer to talk about real estate all the time and say, here's my life. Look what I did. Look at my cool car. Look at my cool clothes. Look at my bag. Here's me at the infinity pool. And then everyone wants that person's life. So they go follow them. They sign up for a webinar. That person explains at a very high level, not very nuanced at all, how this works. You give them your money. They give it to the guy in the new balance tennis shoes and he goes and invest it. Okay. They sell you. We will teach you how to do the thing as a way to get a foot in the door to get you to give them your money. And then they're not even the ones investing it. They're giving it to somebody else. This is a like repeatable common pattern that you will see. And it's not just in real estate. You see the Kardashians doing this like, I don't know which one of them has the makeup brand. She's not designing the makeup. She's not in the lab as a chemist, figuring out how to put this together. They go to an established makeup company. They put Kylie Kendall Kim, whatever on the brand and they put some form of like lips or sensual looking thing. And then everyone goes, Oh, I trust her. I want to look like her all by that makeup, but they're not the ones doing it. So just anytime you're paying for education, that's another thing to vet. Am I learning from someone who does it? Or am I learning from a person whose lifestyle I want? Thanks for tuning in. If you found this valuable, don't forget to hit that subscribe button so you never miss an episode. And if you want to dive deeper into this conversation, check out the links in the description to watch the full episode. See you in the next one.