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This chapter is from the book

One Real Estate Career

Gordon Smith, a friend who graduated in 1959 from business school, decided early on to go into real estate. His story illustrates just how personal, and how particular, the starting-up decision can be.

Gordon grew up in a small Midwestern town, with part of his early education taking place in a one-room schoolhouse. He decided while at business school that he wanted to be a homebuilder. Without exception, his professors and friends told him that taking this path would be a waste of his graduate education. The homebuilding field, as they saw it, was a bunch of guys in pickup trucks with hammers, subject to the wild cyclical swings in the housing sector—in other words, low margins and high volatility.

Gordon loved the sound of all this. Something like a million and a half houses a year were being built in the United States back then. (The total is not too different today.) Couldn’t he use his skills and smarts to grab a piece of that market? And, the fact that no one else in his MBA class of hundreds of equally smart people wanted to go into homebuilding was a plus: Gordon would be the only one in his class who would be applying what he had learned to the housing market. He picked a good locale—the rapidly growing suburbs around Washington, D.C.—where he made himself into one of the area’s premier homebuilders. Half a century later, his firm—now run by his son—is still building something like 500 homes each year.

Gordon’s world of 50 years ago is not the same as today’s. But that’s always the case. The world is always changing. The one reliable constant is that this is a cyclical industry—one in which playing a contrarian game and swimming against the tide, can have great advantages over the long term. Even as you start your real estate career, and you’re preoccupied by the demands of the moment, try to start thinking long term. Think like a contrarian. What can you do that not everyone else is doing?

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