The term “real estate investment” can mean many different things to many different people. I want to expand your concept of what real estate investment means to me, and the first concept to grasp is – that there exists a full-time (or greater than part-time) real estate investment business model that works and works very well. As I’ve said before, I know this because I am engaged in it more or less full time and have been engaged in it since I was 12 years old.
Let’s talk about full-time investment for a moment here. The predominant concept of real estate investment and perhaps many other forms of investment is that it is an activity that is mainly passive – part-time. You the investor spends some time, usually part-time engaged in the investment activity from time to time – perhaps in research or oversight, but for the most part you are engaged full-time in something else that is not the investment activity – something that can range from full-time employment to full-time enjoyment or fulltime retirement. The “investor” image, is therefore a somewhat higher level or higher status occupation than most other forms of work (that require active, full attention engagement), implying that you have money to invest – money that is over and above what you need to survive on and that the money is what is doing some meaningful enabling “work” instead of you. In this popular notion, “investment” is work, one step removed from “real work” that requires real time hourly engagement.
The term “investment” is also tied in with the concept of money instead of time. People who spend time in pastimes of their choice are frequently thought of as volunteers, not investors; whereas people who spend “money” – itself a form of “bottled” time, on the same pastimes, are called investors. Investment and real estate investment also implies a form of long-term attention to some form of “business” as distinguished from speculation. Investment and especially long-term investment is regarded as a higher form of engagement as distinguished from speculation, which is regarded as a short-term form of gambling. Finally, in absolute terms, “long-term” investment technically means longer than a year according to the IRS. In real terms, long-term can mean anything longer than a few months.