This Chapter Concerns City Lands and Country Lands - Importance of Close Buying - Exercising Good Judgment - What Good Judgment Consists of - Qualities Requisite in the Successful Operator - Most Successful Man is He Who Makes Closest Analysis - How to Strengthen the Judgment - Suggestions from Real Estate Brokers - Points to be Kept in Mind - Center of Business - Expansion from Center Generally in One Direction - Object of Buying at Center - Advance Information as to Contemplated Improvements - Frontage Measure of Gain - Corners - Points to be Considered in Buying a Home Place - How to Get at the Facts - Counseled to Buy Slowly - Elucidation of Old Maxim "Let Buyer Beware" - Paying All Cash and Paying Part Cash; Illustration - Figuring Percentages; Importance of Knowing How - Undesirable Properties; What the Investor Should Avoid - Good Advice from a "Mortgage Lifter" - Modern Farming Reduced to a Science - Opportunities in the Northwest - Farming Lands Steadily Growing in Value - Farming Safe and Profitable - Effect of Suburban Trolley Lines on Farming Lands - Big Demand for Newer and Cheaper Lands - Farm Buyer Must be Guided by His Health, Tastes and Previous Training - Real Estate Purchase Chart for City Buyers, with Comments Thereon.
NOTE. In this connection, read also Chapters on "Options and Purchase Agreements," "Deeds," "Mortgages and Trust Deeds," "Taxes and Insurance," "Certificates and Abstracts of Title," "Escrows," "Making a Loan," and "How and When to Sell."
Sec. 35. A man of excellent judgment, who had made a close study of the matter, said: "The majority of people take a long time in which to buy, a long time in which to sell, and no time to study their investments; whereas, they should study the investment a long time, buy slowly and sell quickly when prices have reached the goal point."
In any line of business, one may buy more readily than he can sell; therefore, it becomes necessary to exercise the greater care in buying. In merchandising, good buyers assert that more profit is made in close buying than in any other part of the business. Judicious and economical buying depends on the exercise of judgment.
Sec. 36. "Judgment is that faculty of the mind whereby one thing is perceived of another and the reverse, and a ready conception gained thereby of things and events." In order to exercise judgment, one must cultivate the power of giving attention. It is a power that may be cultivated by anyone, and simply means to analyze, compare and weigh every report that is brought to the mind by the senses. The acquisition of accurate and exact knowledge of things and events can only be gained by attention and application. He who so gains knowledge must have full confidence in his own ability to correctly compare one thing with another before he can impress that ability upon others. Such ability is soon recognized and the man possessing it is said to have "good judgment." If he be a real estate dealer, cautious capitalists ask him to decide before they loan money on a mortgage or purchase real estate. His advice is sought by rich and poor alike and a large portion of the investing public waits on his word. His inherent ability alone would not have sufficed; it was by paying attention that he acquired materials for reflection, formulated rules of action and maxims of conduct, which at length cumulated into sagacity or judgment, that quality of the mind which, above all others, distinguishes one man from another.
Sec. 37. "Confidence, courage and capital," said a leading real estate dealer of Los Angeles, "are the foundation stones on which to rear a large city," and these also are the elements requisite for the successful buying and selling of real estate. The qualities requisite in the successful real estate operator are: (1) aptness and resourcefulness; (2) ability to quickly grasp and comprehend the conditions; (3) alertness to take advantage of opportunities, (4) and the power to patiently master detail.
Sec. 38. Men who have made a success in a particular line of business are said to be "lucky" - favored by fortune, the multitudes think. Such men, consciously or unconsciously, follow a system, pursue a method, and analyze a proposition along lines that lead to success. The minute observation, close study, serious thought and good judgment, exercised by such men are overlooked or minimized. A war correspondent states that the success of the Japanese at Port Arthur was due to a previous thorough analysis of the method of reducing that fortress. He writes: "The Japanese have a passion for detail and a mania for precision; they are so practical they must plainly see on paper what they project. They live by system. They have reduced accomplishment to a problem of economics. They believe, with some of the greatest minds, that the most successful man is he who makes the closest analysis."
Sec. 39. The intending investor, even before he has accumulated any money, can cultivate and strengthen his judgment by taking note of the sales of real estate. Let him ascertain by inquiry as many details as possible of each sale and the opinion of men apparently qualified to know, as to whether or not the place was sold at a bargain price. He thus will become acquainted with the value of property and when he is prepared to buy will be in a position to buy to good advantage. If one is too busy to look up a desirable place to purchase, he should consult a reliable real estate broker, and ascertain if the broker has on his lists any properties such as the purchaser desires. If he has none, he will gladly seek them for the proposed purchaser at no expense to the latter. The broker may be able to give the purchaser valuable suggestions as to the history and prospective value of any property examined. Real estate brokers as a rule are ready talkers and the buyer should receive their random recommendations with caution, and endeavor to cultivate his own judgment as to real estate values. The writer does not wish to be placed on record as decrying real estate brokers; they have been sufficiently maligned. Real estate brokers create and stimulate activity in real estate transactions and without them, in many cases, real estate values would decline and the real estate market be very dull indeed.