Last updated on Dec. 20, 2021
If you’re in the real estate industry for long enough, you’re going to deal with a major crisis. Hell, if you’re a human being, you’re going to deal with a crisis.
There are many crises that occurs in a person’s life: the death of a family member, divorce, failure in business. Of course, the pandemic also showed us how quickly our lives and businesses can be turned upside down.
But for a business owner, these can become much more frequent, especially in real estate, when you’re also helping other people make a trying purchase or sale as they’re dealing with those same problems.
If you don’t know how to handle a crisis, you’re going to make poor decisions, so you better be ready. Here are my tips for dealing with a crisis.
1. Know when you are in fight-or-flight mode
When your heart is pounding, you can’t quite catch your breath, you tense up and start sweating in the face of a stressful situation, you’re probably experiencing your body’s natural response to its protective hormones.
According to Harvard’s Medical School, this “fight or flight” response is a survival mechanism that allows us to react to threatening situations, passed down through evolution.
If repeated over time, this response can lead to high blood pressure, clogged arteries, depression, addiction and more. In this mode, we act fast — and we don’t make the best decisions.
For example, let’s say you run into a snake while hiking. Is your first instinct to kick it or to run away? If you went into flight mode, that would probably be OK, assuming you can outrun the snake. But, if your instinct is to kick it, you’ve entered fight mode, and who wants to fight a snake?
In business, you need to have a calmer state of mind to make a good decision on how you’re going to handle a stressful situation or a tense negotiation.
When you can recognize these triggers — feeling the urge to run or fight — you are more apt to be able to put those natural instincts aside and stay calm.
Director emeritus of the Benson-Henry Institute for Mind Body Medicine at Massachusetts General Hospital, Dr. Herbert Benson recommends breathing deeply, focusing on a soothing mantra, visualizing calm images, praying or doing yoga to keep calm.
In short: Cooler heads prevail.
2. Handle an uncomfortable task each day
When you’re dealing with a crisis with your business, there are often tasks you have to do that make you cringe, including letting an employee go because you can’t afford to pay them and telling a client that you made a mistake.
During a major crisis, there are often several tasks that need to be done to get you through that phase of your business or even your life.
In many cases, some of these need to be done in one day. But more often than not, you still have to go on with your normal business activities to generate income, and your “crisis tasks” can be staggered throughout the week.
If you’re in a position to stagger the tasks, my recommendation is to complete one uncomfortable task per day and spend the rest of your day focused on more positive tasks.
Dealing with a crisis is tough, so try (as best you can) to spend time on more positive tasks or at least ones that occupy your mind, and knock out the worst ones one day at a time.
3. Have a support person or group
Keeping all this stuff to yourself is not healthy, especially after what we went through the last couple of years. You need to be able to have someone to listen to your issues and offer you the emotional support you need.
Hiring a psychologist/therapist is obvious answer, and most people benefit from having someone to talk to in a controlled environment. But you’re also going to want one or two close friends you can vent to as well. You’ll want people who know you and can remind you that you will persevere and that it’s going to be alright.
If you’re in need of a support system because you are new to the business or feel like no one really gets you, Inman contributor David Stroh recommends joining Facebook groups, talking to people in the industry who aren’t in your office or joining a committee.
4. Realize that your worst-case scenario is not actually going to happen
I remember when I had a property management company in the mid-2000s, and we were trying to sell the accounts because everything was just screwed.
The accounting was messed up, we were heading into recession, and many of the owners could not afford to do make-readys when a tenant left because most of them had bought a four-plex with 5 percent down and they used a HELOC loan to make the down payment.
We could barely afford payroll, and I was doing everything I could to just get through this crisis and move on to the next stage of my life. In my head, I was thinking I was going to lose everything, possibly get sued and be left with nothing of the hard work that we put into this business after several years.
I remember reading Tim Ferris’s book The 4-Hour Workweek, and he said something to the effect of whatever your worst-case fear is (the worst thing that could happen), keep in mind that the reality (the final impact) will be much less than you actually think.
And you know what? He was right.
5. Remember who you are
In a business crisis, we often get down on ourselves, and depression sinks in. It’s easy to forget in a few short and stressful days or weeks that you got where you are because you are a fighter, and you have put in years of hard work to get there.
It’s often said that an entrepreneur’s first fortune is the hardest to make. Do you know why? It’s because most successful people get to the top, lose all (or most) of what they made and then make it back.
Have you ever read the Elon Musk biography? It’s a great read. When he was building SpaceX, Tesla was in the dumps, and he was weeks away from bouncing payroll checks.
He went from flying private jets from Los Angeles to San Jose to having to take Southwest flights. Can you imagine how that felt? In the time between SpaceX’s third and fourth launch, Musk was flying on Southwest and the fourth launch was finally successful, and he received a multibillion dollar contract with NASA.
During this stressful time, do you think Musk forgot who he was? Maybe for a minute, but he did not let doubt control his destiny.
All of us will go through some sort of major crisis in our lives and our business. It will not be the end of the world. It might seem like it at the time, but it’s not. Hold onto your friends and family as best you can. Take it one day at a time. Keep moving. I know it’s hard. But you got this far. You can make it through this.