It’s hard to grow up in the United States without ever playing Monopoly. This game— enjoyed by both adults and children— has been a staple of American culture since its conception during the Great Depression. It’s ironic that the money hungry, business driven game of Monopoly made a mark in an era when there was little money to be had— a testament to the entrepreneurial nature and resilient spirit of the human race.
Although created over 70 years ago, the concepts learned by playing Monopoly can be applied to real estate investing. Real estate license or not, the correlation between Monopoly and real life investing is close. When I began investing, I noticed that there were four ideas taken from a board game that I could use in real estate. Here are the strategies that I have taken from Monopoly and applied to my career as a real estate investor. You may find the helpful in your own career.
Get cozy with the rules
When you know the rules inside and out, you have an advantage in your Monopoly game. In real estate, being “in the know” is the same idea. You handle surprises and ‘the way the dice rolls’ differently; better. This is because you envision multiple possibilities. It’s easy to want to jump into playing without understanding terms and conditions, but when you are best friends with the rules, you know where and how to win.
In Monopoly, an avid player knows that the best way to make a profit. It’s about buying as many properties as possible. As a winning investor, buying more than one property is beneficial to your game. As a Monopoly player knows, the game can go long. As a real estate player, I’ve learned the way to be successful is through a strategy of property building and buying for the long term. This has worked for me.
Remember to purchase properties that are worth you cost and time, AND fall within your budget. Consider factors such as inflation and interest rates. These could whack you in the head later if you (as mentioned in the first point) aren’t aware of the rules.
Be a visionary
Monopoly and investing is a marathon, not a short sprint. Don’t let the flash of short-term cash shadow your vision with rose colored glasses. From my experience, I’ve learned that the best investors who stay in real estate maintain a long-term perspective in the face of immediate gains. Remember your long term goals and returns.
Deal in destinations
In real life, ocean view—even if it’s a sliver from the minuscule bathroom window—is often advertised on available properties, bumping up the price point by millions. It’s all about location. A property can need an incredible amount of TLC, but be a gold mine thanks to where it lies. As a winning real estate investor (just like you would in Monopoly), deal in destinations.
There are many other takeaways an investor can discover through the board game, Monopoly. Maybe pull down from the shelf and spend a Saturday night in a time-warp; revisiting a game that might remind you of things to keep in mind in real estate.
I hope that these few tips will start your brain thinking, and motivate you to play and win the real life investing game.