Not many people have a property investment strategy when they begin their real estate journey to financial freedom. As a result, many lose money, get de-focused and either quit or turn their fortunes around by getting some education.
You can quickly see why it is vital to create your property investment journey, to help you stay on track and focused.
In this interview, Inspirational Woman of the Year 2017, Robbie Mathews and Ben Chai share several tips on building a property investment strategy. This interview was taken at the JT Foxx family reunion (now Mega Success event) for wealthy entrepreneurs and business people.
Should you have a slow internet connection or cannot hear the interview, you will find a summary of Robbie’s tips below the video. However, we recommend you watch/listen to Robbie for more insights than our notes provide.
Property Investment Strategy Tip 1
Decide if you want to be Passive or Active
Your first challenge with property investment is to decide on whether you’d like to be an active or passive investor. This decision will determine your next steps as you build your property investment strategy. “Passive” and “active” also have different meanings depending on your location. This interview examines, the meanings from a US perspective:
The passive investor seeks to generate income primarily through investment in Private Equity Groups or through Real Estate Investment Trusts (REITs). Essentially, passive investors give their money to other people who then invest their money for them.
An advantage of passive investment is that you can invest in property without the associated time intensive tasks and stress. Stress caused by finding property deals, tenant management, and damage repairs. However, the returns are potentially lower as a passive investor needs to split the profits with other investors. You will also have less control over the investment decisions of the group.
An active investor is on the front lines actively finding deals, creative solution thinking, getting mortgages, building relationships with sellers, letting agents, builders, estate agents, solicitors, mortgage brokers. Naturally, active investing requires a significant time investment and comes with a substantial amount of stress.
The time investment also extends to educating oneself on all aspects of property investment. This education includes negotiation, property laws, creative finance, cash flow, different types of strategies, and many many other skills.
Property Investment Strategy Tip 2
Robbie followed the path of the passive investor. This path meant she (and her husband Michael) needed to find partners to join them on their property investment journey.
In any property investment journey (well, in any journey really), you need to find experienced people that can offer advice and help with your journey. Tip 2 applies whether your strategy is passive or active investment. When you look for partners, find people that you connect with. People who will be with you in both the bountiful and stressful situations common in any significant endeavour.
Book Plug: If you are interested in how to create and find loyal reliable connections do read our book on social magnetism.)
To find the right people to work with, it’s worth “dating” prospective partners. These “dates” will help you discern if there is a good fit between you and them. Take them to coffee or invite them to do an activity such as play a game of tennis. Activities are a fun way to see what people are like under pressure and how they react in team situations.
Property Investment Strategy Tip 3
Network to Connect
You may have to meet a lot of people before you find business partners that you feel comfortable and can connect with. Have a look at people you’ve successfully worked with on previous projects.
If they are unavailable then go to events where you can meet and connect with like-minded individuals! Events where you are likely to find your future business partner include property and entrepreneurial events. (Remember there are right ways and wrong ways to network).
Whatever the event you attend, it is important you make a list of traits you want in a partner. This list will help you disregard unsuitable people and move you into conversations with the right people. With that said, be open to listening and speaking to everyone, you never know who you might meet.
Huge thanks to Robbie for sharing her insights with us. If you found this interview helpful do
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In the meantime, if you want to learn more about property investment from other people’s journeys, check out the following articles:
- How to build a one million property portfolio in just 2 years
- How to turn £6250 into £1.5 million – one man’s incredible property journey
- Lessons from my first property lessons
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