Successful Investing

Startfrom where you are now – are you knowledge, time or cash rich – maybe none of the above.  Whichever it is, then this is the part you can play in a joint venture.  Working with others you can capitalise on this to make your part of the investment more valuable.   Find partners to work with who can supply one of the other components to make a formidable team.

Understanding how the financial processes work for all the different types of investment is going to be the key to your success.  If you don’t understand them then you are not going to be able to explain them simply to any of the potential vendors or joint venture partners you come across.

Consolidating your assets in order to have the best platform to invest from comes next.  This might be from a financial perspective or a knowledge one.  Gather all the money you and your family have together to make the best cash pot you can.

Creative financing might be very tempting and many investors have used this to great advantage, but don’t overlook the obvious.  If you can buy traditionally and afford to wait for 6 to 12 months to revalue and return the money, then there are literally thousands of properties up for grabs pretty cheaply.

Effective investments are based on a really good purchase price and a fantastic return on investment.  If it doesn’t stack up really well at the moment with very low interest rates then walk away quickly as it certainly won’t stack in a few years’ time.  Make sure you don’t scrimp on calculating your cashflow based on at least 6% interest rates.

Surprises are one of the biggest causes of failure in the property market, so don’t get caught out.  Make sure that you have covered all eventualities.  This applies to your discussions with motivated sellers and joint venture partners too.  It’s very easy to ‘talk up’ the investment opportunity without paying enough attention to the downsides and stress points – make sure you give yourself and those you deal with a balanced view.

Fundamental processes need to underpin every system you use to buy your property.  From the way you manage your due diligence process to the way you analyse the deal – this needs to be systemised and routine.  These processes don’t need to take a long time, but you do need to follow a set pattern – You have to compare like for like.

Use every resource you have.  Many investors assume they are starting from scratch in a new arena and forget to use and rely on all the skills they have built up at work or in general over many years.  Your experience of analysing if you should do something or not started when you were still a child – don’t give up that skill when you start investing.

Listen to the experts.  There are specialists in every area of property investment and they have often made the mistakes for you along the way.  When you have chosen your specific strategy for property investment then make sure you have found the experts and read everything they’ve written.  Follow their blogs and trawl their websites for how to do it right.

 

Intuition plays an important part of whether or not a deal works for you.  No matter how much research you do, there may be something nagging at you that says it’s not for you.  Be very clear that it fits your strategy or you will find yourself fighting for a reason not to do the deal.

Negotiate your deals as though you are speaking to a friend.  Treat your motivated sellers with the utmost respect and you will be able to find a win win situation for you both.  The more you relate to them the more information they will give you and the better you will be able to help them.  Is it actually going to help them if you buy their property?

Virtual services are a must for any serious investor who wants to turn their investment in properties into a business.  You will need to delegate so that you can do the things you do best.  There are many excellent phone services who will take calls from any leads generated, and this gives you the opportunity to do your research before ever speaking to the seller.

Eventually you will feel comfortable with an investment area.  This may be near your own location, or some distance away.  Find the lowest price properties in an area, and if it has good rental opportunities then this could well be a great place to invest.  Where investors go wrong is they buy ‘nice’ houses in good areas.  The difficulty here is that the purchase price is too high which lowers the yield and doesn’t encourage sufficiently high rental returns.

Significant returns are what we are looking for.  What is the best use you can make of the space you are buying?  How many rooms are there?  How much would you get per room in comparison to a family let?  Stick to the minimum return you would take as if it were a stop loss in a trading room.  Cash-flow requirement per month is part of your strategy – don’t drift.

Take one step at a time.  The biggest mistake we make is to imagine we are going to succeed overnight.  Every endeavour takes time and nurturing.  You have to go through the slower first stages in order to make the most of the harvest later on.  If you try to miss out these steps and catapult yourself to the top then the stems are week and there is more potential for the system to flop.

Invest in yourself as well as in property.  You’ve heard it before, but have you actually taken action on this.  Many of us do the tour of the personal development seminars and the property networks and seminars, but now’s time to challenge yourselves – have you taken action yet?  Well it’s never too late – what are you waiting for?

Never give up.  This is the mantra you need.  We all get burned at some point along the way.  You need to treat this as learning and not failure.  Without persistence the target is never reached.  Athletes are training now for the Olympic Games in 2012 – work as though your target is 2012 and see what difference that makes.

Go for it. If you think you can or you think you can’t you’re probably right – Henry Ford.  If you haven’t taken action in the last 3 months then there is something stopping you.  Find out what it is – be honest with yourself.  If you haven’t been able to do it on your own, then find someone who can help.  There is always a way, you may just need someone else to see it from a different perspective.

Have your biggest impact in the property market through SUCCESSFUL   INVESTING – start now.

Published in Your Property Network  Magazine – September 2010
By Yvonne Emery

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