According to Vicki Wusche, successful property investor and author of ‘Property for the Next Generation’, it’s not enough to want to make money from property (although that is very important!) You also need to understand the “life” that you want property to give you – the lifestyle – and therefore how you will engage and interact with the properties that you invest in.
To be a successful property entrepreneur you need to be clear about what role property investment plays in the grand scheme of your life. Not understanding this is the single biggest reason people fail as property investors.
Think about the lifestyle you want; time off, holidays, more freedom, more choices, a shorter working week, or perhaps you want to continue in your current career and property is a side-line, or maybe you see it as a full time job and something you want to develop and focus on every day. Be clear.
Once you know approximately the sort of lifestyle you want to live you can budget for this and work out how many properties you’ll need and which strategy will get you the lifestyle you are looking for.
For example if you are looking for straight forward cashflow with very little of your own time – then buying three bed houses and letting them to families can help you attract tenants that will want to stay as their children are in local schools.
If you can find properties that give you a great return near to where you live and you have a lot of spare time then consider letting to professionals in houses of multiple occupancy. But this strategy will require a lot more of your time.
Once you’ve chosen the strategy for you, focus on it. Don’t play around with a few different approaches. Choose what will work for your goal and commit to it. Get help if you need to – but find the right strategy for you first and then take action.
If you chose to work with a sourcing agent then ensure they help you recognise your financial goals and identify your financial assets, and then help you create a plan to reach your personal investment targets. If they don’t, then the chances are they are just after your money! Also check out how long they have been investing, what their portfolio is like, what their clients say about them, and what their business model is.
A common mistake is to hand over responsibility to someone else. Never do this. Take responsibility for your own financial future. Employ all the professionals you need but retain control over your cash pot. Make sure you understand how and why the money is being used, what you want from your property and how a particular purchase is going to help you achieve that.
Always leverage your resources. For example using a builder, solicitor, broker and letting agent leverages your time and their knowledge. Every successful property entrepreneur knows how to leverage their time, their money and their staff. Calculate the value of your own time so you can make new judgements about where your time is well spent.
Find the right help, check out people thoroughly and above all never hand over money to someone else to invest for you.
Property investing can provide you with the additional cash flow your family needs, creating a property investment business, expands your thinking and helps you create a lifestyle as well as the cash to support it.