So what skills and attitudes do you need to develop in order to be a successful property investor?
Well, I think this is not too different to being successful in any new venture, whether it is starting a new business, being good in your job, or good in some other endeavour such as sport.
- A plan.
- The right attitude.
- The aptitude to wear many hats.
- The ability to FOCUS.
If you can master the above, then you can keep going when it gets tough, boring or life gets in the way. Let’s explore each of these.
Plan plus Action equals Results
Let’s break down the key ingredients that when applied to almost any endeavour, will see you succeed.
- An Investment Blueprint, which forms your Project Plan. Without this, how do you know where to start or what path to follow? How can you measure progress to your goal otherwise? Use Key Performance Indicators to track everything of importance.
- Persistence. Understand this is a process and must be walked through. Realise you will have good days and bad days. Stuff will go wrong. You will have problems with tenants, deals will fall through and funding will be hard to get. Success is not a simple upward slope, but really a sequence of ups and downs heading in the right direction.
- Consistency. Understand what actions you need to take and actually take them. Week in, week out. Diarise tasks you need to do in order to fit around your lifestyle and stick to them. E.g. Saturday mornings for viewings.
- Knowledge: You wouldn’t start a business without understanding the mechanics of that business thoroughly. Educate yourself sufficiently, but don’t use continual education as an excuse for not actually doing anything.
Be serious about this. If it was easy, everyone you know would have a property portfolio. How many of your friends, family and work / business colleagues have property investments?
I would be willing to bet its a very small number. There is a reason for that.
Note that motivation is not enough. Motivation is a fleeting concept, but no-one can sustain the persistence and consistency required in order to keep going over the long term through motivation alone.
Instead, focus on creating positive habits. Think about when you got up this morning. Did you lay in bed for an hour, thinking about whether you will get up and head for the bathroom, or go and get a coffee or breakfast first? Do you think about whether you shower first or clean your teeth first?
Most of us have a morning routine we don’t even think about any longer. We just do it, as it has become such an ingrained habit. Positive habits is what you need to cultivate to get things done.
The Many Hats of a Property Investor
You should understand that the title Property Investor means you comprise several, distinct, roles:
- Sourcing and negotiating suitable deals.
- Funding those deals.
- Managing any forced appreciation works.
- Managing the tenancy and property (if a Buy-to-Let).
These actually require distinctly different skill sets, not to mention a large time commitment and you are, in effect, signing up to managing all of these.
In the beginning, it makes sense to do it all yourself. You need to understand what is involved and learn the ropes. In the future, you can look at outsourcing, partnering with someone or focus on the types of investments you are good at.
I do not subscribe to the mantra that you should work on and develop your weaknesses. This stems from our school education, where the idea is that you got good grades in a wide-range of subjects. In the real world, focusing on the skills you are really good at will more likely give you an edge, whether in your job or in property investment.
The stuff you don’t enjoy, or are not good at, you should look at outsourcing or forming relationships with those that are good at it.
Beware the Shiny Penny Syndrome!
If you spend any amount of time immersed in the property world, you will come across a plethora of different strategies and approaches, often pitched by those with a vested interest in selling you something! These can be from:
- Sourcing companies.
- Training companies.
Think of all the different types of buy-to-let property investing you may have already heard of, for example:
And so on. It is easy to attend a networking event and see an invited speaker wax lyrical about a certain investment approach and get as excited as they are and before you know it, this is what you want to concentrate on.
Until the next networking event, a different speaker and a different approach.
This is known as Shiny Penny Syndrome: The weakness for us to get excited by and attracted to the next interesting thing. Usually, this can strike us down badly when we are struggling with something else or an alternative approach. Rather than double-down on making that work (remember the consistency and persistence required), we switch focus to this next Big Thing.
The result is we are constantly changing focus, constantly learning for the sake of it and never actually achieving anything. It’s addictive and its dangerous and I have seen it multiple times.
This is why you need to understand your own why and spend time developing an Investment Blueprint. With this as your guide and focus, you will resist the temptation to switch focus when you struggle or get bored.
As a result, I would strongly advocate focusing on one, or at a maximum, two approaches at any one time. There will simply be too much to do, around all the other demands of your time, to work on any more than this. Remember to FOCUS:
Stick to your primary method as determined by your Investment Blueprint and focus on making this work before diversifying. You will get so much satisfaction from doing this and actually gaining traction and making your first investment that this will snowball, whilst others are sat reading about another Shiny Object and not getting anywhere.
Property investing is not rocket science, but that is not the same as saying it is easy. As you have learned, it takes:
- A well thought out plan.
- Consistency of focus.
- The ability to do many tasks.
- A laser-like FOCUS.
Our brains are hard-wired to look for shortcuts, quick wins and easy solutions. In property (as in life) there is no such thing.
Keep the above in mind, execute it faithfully and you will succeed. This is not a race.
Now, get started.