Sometimes I don’t feel like a citizen of the 21st century, but instead like I’m operating on a green card. I’m so old, I remember when most rational people took for granted that there’s such a thing as reality. Maybe you know what I’m talking about, or perhaps I’m just an odd duck.
Our team helps wealthy people make great financial choices, which may affect their household for a generation. To be effective we must be wise, correct, and realistic. Our team motto is “We’re focused on our client’s success.”
Many people I encounter act as if they believe they can change reality by wishing hard enough. “What the mind can conceive and believe, it can achieve.” Unfortunately, that’s not true, especially in a competitive arena like apartment investing. I wonder what life experience re-enforces such a perspective. Here are summaries of recent interactions with millionaire investors.
Rich owns a nice property. He expects to sell his good property for about 8% more than it will appraise for. For Rich’s wish to come true, we’d have to find a rich sucker, represented by an incompetent broker, who will go to a stupid banker, and that they will hire an idiot appraiser. Rich is keenly disappointed at my failure to wave my magic wand and make that happen.
Nimrod was certain that with enough flattery that he could persuade me to deceive my client and help Nimrod get a far better than market price. He offered me a bribe to lie to my client. Why would anyone want to hire an agent he knew was dishonest? Nimrod eventually realized that I would not lie to my client because I had an obligation to put my client’s interest ahead of my own. Nimrod withdrew his earlier comments and told me what a fool and how vain and incompetent I was.
Tom Titan contacted me a few days ago. Tom is in that rare subset of investors who routinely capture better than average values. With my client’s consent, Tom and a few other superstar buyers got a head start on a highly desirable property for a relatively good price.
Three other superstar investors wrote offers within two days. The seller countered two of them. By the time Tom called me a deal had been made with another superstar buyer. He knows contract law: the buyer can buy for contract price and the seller is obligated to sell for that price. But after he had heard that the asset was in contract for more than he was willing to pay, he asked three times if he could get the deal. Unfortunately, my magic isn’t that deep.
Many wealthy people who contact us don’t want exceptional results; they want magic. In my arena the difference between closing a transaction and coming in second or third is usually less than 1%. Many “wannabe” investors want 5% better than market reality.
They forget that well informed principals make careful choices with the information available. Market value means that both parties are well informed, and neither is under duress. Yet many high energy, high ego, high achieving people speak and act as if their insistence or their desire will change reality.
Some rich people even seem surprised that other affluent people act in their own best interest. Every week I witness someone acting as if they’re so special that the other side should ignore reality and forfeit wealth to benefit the egotist. I’m not surprised when children or emotionally immature people are so self-centered that they don’t recognize that others will act in their perceived best interest. It is breathtaking to me when people who are unusually successful expect that the world owes them a favor.
Am I the only one? How do you deal with people who seem to live at the center of their universe?
Terry Moore, CCIM, is the author of Building Legacy Wealth: How to Build Wealth and Live a Life Worth Imitating. Read his “Welcome to My Blog.”