Forming Your Real Estate Investment Philosophy  

Every real estate investor has a strategy. It dictates how you handle your business, manage your properties, and the values you follow when making decisions and forming a comprehensive business plan. Understanding your strategy and real estate investment philosophy can benefit you in a multitude of ways, but it can be difficult to organize your thoughts and goals. For this reason, we designed a real estate goal setting worksheet pdf to help you define and visualize your investment strategy’s goals, principles, and strategies. 

What is a Real Estate Investment Philosophy? 

In simple terms, real estate investment philosophies are the building blocks on which your investments stand. They are built on your business’ core goals, tenets, and strategies to make up your process and principles. With a real estate investment philosophy, you can take a step back and examine your values to determine the direction you want to take when decision-making, putting your plan, budget, and core values at the forefront. 

Organizing your principles, processes, and beliefs is the first step in building the real estate investment business of your dreams. By taking time to focus and track a list of your goals, ideas, and vision for your future, you set yourself up with a plan for future investments and decision-making. 

Incorporating your career goals into your investment philosophy as well ensure that your professional aspirations are aligned with your business strategies. 

Your real estate investment philosophy may take time to craft and perfect or even change over time, but don’t worry — with a real estate goal setting worksheet, it’s easy to reevaluate or modify your philosophy if you’ve outgrown it. 

How to Form Your Own Real Estate Investing Philosophy 

Let’s talk about three things to think about before you sit down to draft your real estate investing philosophy. 

#1 Understanding Your Goals 

Determine what you want to achieve in your real estate business 

To set effective goals, it’s essential to understand what you want to achieve in your real estate business. Take some time to reflect on your vision, mission, and values. What drives you? What motivates you? What kind of real estate business do you want to build? 

Consider the following questions: 

• What are your short-term and long-term goals? 

• What kind of properties do you want to specialize in (residential, commercial, industrial, etc.)? 

• What geographic area do you want to focus on? 

• What kind of clients do you want to work with (first-time homebuyers, investors, etc.)? 

• What kind of services do you want to offer (buying, selling, renting, etc.)? 

By answering these questions, you’ll gain clarity on what you want to achieve in your real estate business and create a solid foundation for setting specific, measurable, achievable, relevant, and time-bound (SMART) goals. This clarity will help you stay focused and motivated, ensuring that your efforts align with your vision and mission. Whether you’re aiming to increase your gross commission income or expand your portfolio, having well-defined goals is the first step towards success. 

#2 Defining Success in Your Real Estate Business 

Determine what success means to you 

Defining success in your real estate business is essential to creating a clear vision and direction. Success means different things to different people, so it’s essential to define what it means to you. 

Consider the following questions: 

• What are your financial goals (income, commissions, etc.)? 

• What kind of lifestyle do you want to achieve (work-life balance, etc.)? 

• What kind of reputation do you want to build (expertise, trust, etc.)? 

• What kind of impact do you want to make (community involvement, etc.)? 

• What kind of legacy do you want to leave? 

By defining what success means to you, you’ll be able to create a clear roadmap for achieving your goals and building a successful real estate business. Whether your aim is to achieve a specific net income goal, improve your work-life balance, spend more time with your family, or make a significant impact in your community, having a personalized definition of success will guide your decisions and actions. This clarity will not only help you stay motivated but also ensure that your efforts are aligned with your long-term vision and values. 

#3 Finding Your Niche and Target Market 

Get specific about your investing plans

Finding your niche and target market is crucial to success in the real estate industry. A niche is a specific area of specialization that sets you apart from other real estate agents. Your target market is the specific group of tenants you want to attract. 

Consider the following questions: 

• What are your strengths and weaknesses as a real estate investor? 

• What kind of properties do you have experience with? 

• What kind of tenants would most be interested in your properties? 

• What kind of services do you want to offer? 

• What sets you apart from other real estate investors? 

By identifying your niche and target market, you’ll be able to focus your marketing efforts, build a strong reputation, and attract the right tenants. Specializing in a particular type of property can make you an expert in that area, which can lead to longer tenancies and better overall experiences for tenants. Whether you’re focusing on luxury homes, commercial properties, or multifamily housing, having a clear niche and target market will help you stand out in the competitive real estate landscape. 

Components of an Investment Philosophy and Real Estate Goals Template 

There are many components that go into constructing an investment philosophy. After all, it’s the entire foundation of your business. What matters to you will take time and thought to conclude about, and there are many topics to keep in mind. Each component blends together to make up your strategy and plan for investing. 

Mixing ideas and plans for your future will create your ideal real estate goal setting worksheet. Different aspects of your investment philosophy may include: 

• Core tenets — What core principles do you abide by? Why do you want to build wealth? What’s important to you? These are questions that can help you build a clear list of your values as an investor. 

• Asset classes — What kinds of real estate are you targeting? Is your portfolio made up of single-family homes, commercial real estate, or something mixed-use? Are you interested in changing your target or growing within your current one? Making these decisions early in your investment journey can help you stay on track later on when scaling your portfolio. 

• Management plan — What’s the approach you take to management?  How involved do you want to be in managing your own properties? What’s your budget for property management? A clear, easy-to-follow management plan is easy to fall back on when operating and upkeeping your properties. 

• Goals — Your goals are one of the most important aspects of a potential investment philosophy and should be treated as essential. It’s a good idea to set both short and long-term goals for yourself, such as diversifying your income streams, keeping a steady line of passive income, or budgeting for a percentage of your income to be set aside in a reserve. Setting goals keeps your eye on the prize and helps you to stay motivated as you learn more about investments. 

• Other considerations — Any other foundational information you think is important can go into an investment philosophy. Are there business quotes you’ve collected that inspire you? Do you have ideas about the long-term vision you have for your investments? Put them into a list to reference periodically. 

These are just several components that can be included in an individual’s investment philosophy. Guidelines for handling risks and complications in investments can be added to your philosophy, as well as a single overarching goal if you have one and any connections you have to other types of investing. By including these components, you lay the groundwork for a successful business in the real estate industry. 

Why Creating a Real Estate Investment Philosophy with an Investing Goal Worksheet is Essential 

Your investment philosophy is vital because it’s what you fall back on when you experience challenges or difficult decisions. By planning for the future of your investments, you can remain focused and centered during market fluctuations. Additionally, by outlining your real estate goals, both short and long-term, you give yourself the opportunity to align your investments with them and achieve success in your business. For example, if your goal is to do more business with commercial real estate, you can adjust your investments accordingly to reach that goal. 

Keeping your real estate philosophy in mind also helps you create a clear decision-making framework. When faced with decisions you’re unsure about, you can look back at your core beliefs and values for your business and examine what choice aligns best with your philosophy. Reflecting on your professional growth can help you make informed decisions that align with your investment philosophy. 

Creating a real estate investment philosophy helps you to understand what your specific plans, goals, and ideologies are so you can effectively implement them into your investment journey, making it essential to your business. By focusing on both personal and professional growth, you ensure a balanced approach to achieving success in the dynamic field of real estate. 

Conclusion 

Your unique perspective will help you to establish your personal real estate goal setting template and stick to it. This philosophy can be implemented in various steps of your investment journey and will help you build a strong, clear vision for your future in investing. 

Clearly defining this philosophy can be a difficult task, which is why we’ve designed a real estate goal setting worksheet to help organize and analyze your thoughts. Using a real estate goals template can simplify the process of organizing and tracking your objectives. 

Download Innago’s investment property worksheet above to get started.