Investment Property –
The 5 Year Plan
“Horror stories are an opportunity to learn not a reason to QUIT”.
For those venturing into investment property, you quickly realize that doing something passively in the home you live in or just to hold on to that second property in your old town differs from doing it professionally. A different level of planning is required if you intend to make a profit or even just want to build equity.
Steps in your plan will need to include:
Knowledge is power. When investing knowledge is the primary power. You simply must understand what you are getting into by consuming as much information as possible about the real estate market, financing, and management after starting or before you even start. Care must be taken to avoid the “succeed like me” overnight sensations and try to get information from sources with real experience. Another good way is to do research into case studies where things went wrong because nothing teaches like failure…just don’t make it YOUR failure.
An ancient Chinese proverb says that “the best time to plant a tree is ten years ago”. There is simply no time like the present to get things done. Keep in mind that inflation and currency devaluation are a reality of today’s financial world.
WEED OUT BAD ADVICE
Thanks to the internet and social media the world is saturated with information on how to do everything from “get-rich-quick “schemes and “life hacks” to the most far-fetched conspiracy theories. The only way to properly weed out bad advice is to obtain a proper understanding of what you are doing through research and experience.
DON’T BE EMOTIONAL
Passion can be a great tool for achieving goals but should not be confused with emotion. Don’t be like the bull that charges blindly into the Matador’s sword.
Every venture has its risks and pitfalls which some people are always more than willing to emphasize. It can be tough to ignore concerns raised by people that might be genuinely concerned about you. However, the best way to arm yourself against negative opinions is with knowledge. Horror stories are an opportunity to learn not a reason to QUIT.
Investing in property is an excellent way to build wealth. It just doesn’t happen overnight. Mortgages usually range between 15-30 years which is the time period you are looking at for your investment to come full circle. If you are one of those whose mind is set on making a “killing” within a short time, then this may not be for you.
Because property investment is a long-term venture remaining focused is a must. Along the line, you will come across several opportunities (both real and perceived) including “flipping” of properties and divestment into other ventures. This is particularly challenging when you’ve been in the business for a while and are feeling a little fatigued.
BE READY TO SEEK HELP WHEN NEEDED
As much as you may have learned or experienced it may not be a bad idea to seek counsel with the right people especially those that have successfully navigated the challenges you are currently facing. Investors and business owners often try to cultivate a certain “strongman” image which serves its purpose in public but may cause embarrassing errors due to isolation. A common ruse is the offer to “host” certain industry experts and then subtly ply them for information by getting them to recount “war stories”.
Another good strategy is to get someone to do all the work. A professional property management company not only frees you up to pursue your career or other important interests but may save you a lot in terms of costs and frustration.
WestHawk Property Management
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