Off Maui’s dramatic shoreline are some of the world’s most beautiful bays and ocean breakers with translucent blue/green waters. These waters are as alluring as they are deceptive; standing on the shore, it is not readily apparent that the currents are swift and intensely strong.
I just returned from a trip to the island where I watched tourists jump into the water, oblivious to the currents into which they were about to plunge. One afternoon during our trip, I witnessed one swimmer do so with nearly fatal results. (The story had a happy ending; the swimmer and those who raced in to save him were rescued by emergency services.)
I began thinking about visitors to our mountain resort and how the parallel to swimming in Maui waters relates to real estate investing. I pondered how lessons learned in Maui may be helpful to Buyers who are eager to jump into the local real estate waters, but are as unfamiliar with local conditions as those newbie island beachgoers.
Let’s look at a series of questions Buyers may ask themselves as they embark upon their investing adventure that maximize return and minimize risk.
1) Weather and water conditions. Maui swimmers need to know the latest weather report, tide charts, trade wind activity, and how to spot rip currents BEFORE they jump into the water. Similarly, investors need to scan and understand the local market conditions. That is, what is going on generally in the market? Are we trending toward a Buyer’s or Seller’s market? Are prices stable, increasing, or decreasing? Do local experts have suggestions for certain real estate investing selections based upon current conditions?
2) Start broad and then go narrow and deep in your interest area. For a dramatic and joyful snorkeling experience in Maui, you learn about each of the different snorkeling areas first, discern what each area has to offer, how popular certain areas are, and then select according to your interests and desired experiences. In real estate investing, you want to follow a similar process. Obtain an overview of all the neighborhoods, investing pockets, as well as all the investment opportunities. Then go deep for details and specifics and consider how well the opportunities line up with what it is you want to have happen. Also, is it crowded in your desired investment interest area? Why or why not? What does that tell you about your timing and/or investment choice?
3) Who is your diving buddy? This is vitally important! The distressed swimmer who got into so much trouble had gone into the water solo. In fact, it was clear his family members had no idea he was even in the water. You absolutely need someone partnering with you as you make your investment decisions. Your investment partner may be a knowledgeable family member or friend with considerable real estate experience, and/or a real estate professional. The old adage about the “lone genius” is a myth. Get all brains on board and ask for input and advice.
We had the time of our lives swimming amongst the sea turtles, coral reefs, and dazzling tropical fish in one of the world’s most breathtaking bodies of water. We had experiences that will forever be ingrained in our hearts and minds. Your real estate investing experience may be as rewarding and joyful; just be mindful of taking certain prudent steps and always be respectful of the environment in which you want to become a part.
And then, jump on in and relish the great offerings of this gorgeous mountain community.