Guideline #26: Hold it, or add value
By its very nature, most real estate investing is profitable over significantly long time periods (upwards from ten years). Actually, this it true for most forms of investing, which is probably why only such a small percentage of folks actually achieve financial independence.
There is no sense in sugar coating it: owning investment real estate can be a hassle. There are tenant related problems, weather related problems, maintenance problems, and so on and so forth. For a society weaned on immediate gratification, these day-to-day hassles often obscure our vision of the wealth down-the-road. Many are the people who make the first investment. Few are the people who are still actively investing ten years later. It requires patience, focus, and self-discipline.
It certainly is possible to make significant gains investing in real estate over shorter time periods. To earn these faster returns, however, there must be "value added." Value adding can mean, among other things, an annexation, a zoning change, sub-dividing, building roads, extending water and sewer lines, constructing (or removing) a building, assembling adjoining properties, renovations, or extensive cleaning and painting.
A brief discussion of "flipping" appears in Guideline #27.
Jim Rohn, one of my early teachers, always talked about the "set of the sail." The winds of life blow on all of us, but where we end up is determined by the set of our sail. The most reliable path to financial independence is to have the self-discipline to begin an investment program and the patience and focus to see it through for a long time. The time is going to pass anyway, why not do it?