A common issue we face is trying to fix other people’s problems – be it an investor who has been misled into buying the wrong property in the wrong area, or a landlord who has taken their eye off the ball and let things get out of control.
What is the wrong property to buy?
There are countless types of property investments to get involved in, ranging from straightforward, ‘vanilla’ terraced houses in the suburbs, to part-ownership of hotels & cruise ships. Just because an investment makes a certain return, doesn’t mean that it’s the right investment for you.
What is the right deal for me?
It’s more than just money that goes into an investment. Think of your bank account. You get a pittance in interest, but that’s because you’re not putting anything else (time, expertise, experience, etc.) into it. You just transfer the money and let the bank reinvest your money elsewhere – for their own gain.
The perfect recipe for investment takes into account key factors such as time, money, expertise, and contacts. Just like your DNA, your individual recipe is likely to differ from most everyone else’s.
How do I create the perfect investment recipe?
By getting all of your ingredients out in front of you first, rather than starting with a sponge cake and trying to turn it into a Vienetta. Bear with me.
If you buy a property because “it looked like a good deal”, or because “they said it would make me x return”, then you may find yourself trying to fit a square peg into a round hole.
If you are time-poor, then a HMO (House in Multiple Occupation) then you are likely to end up either losing a lot of money doing it yourself, or, making the same amount of money that you would from a much less-risky investment (because you’ll have to pay someone who does have the time to look after it).
Get back to basics
Ask yourself the following questions:
- How much TIME have I got to put into property (as a whole investment class)?
- How much CASH have I got to invest?
- How much RETURN am I hoping for?
- Do I have any EXPERTISE to invest?
- Do I have any CONTACTS that can add value to my investment?
Answering these questions honestly will help you buy the right property, in the right condition, in the right area – and for the right price.