Why People Fail at Property Investing (And, 7 Rules to Help You Succeed)

Only a certain percentage of Australians start out on a property investing journey – and there are even less who become successful at it.

 

And this is no surprise.  Because when are we ever taught about investing or wealth creation or anything to do with creating financial freedom in our lives? Answer….NEVER!

 

This means people get ‘stopped’ from building a big portfolio because they make these mistakes.

 

  • Wrong property choices
  • Ineffective finance structuring
  • Or get stopped by fear or laziness

 

But the key fundamental reason that many investors don’t build a large portfolio is because they lack a strategy – a clear step-by-step plan to take them from point A to point B.

 

And if they do have a strategy it usually consists of the very sophisticated “Buy and Hope” strategy; you buy a property and hope like hell it goes up.

 

Now, this is not an intelligent strategy for someone wanting to create financial freedom using property as a vehicle.

 

There can be a lot that goes into strategy, but let me give you some of my core philosophies when it comes to building a property portfolio that gives you great results.

 

Building your portfolio the right way

 

Rule 1. Strategy is about simplification, not complication.

 

It’s about getting clear on where you are going, and always knowing your next step to get there.

 

Rule 2. There is no one size fits all approach to strategy.

 

Strategy is as unique as you are and has to be tailored to fit you, your life and your dreams

 

Rule 3. Property investing is a business. Treat it like one. This means….

 

  • This means you need to take time for it (doesn’t mean a lot of time)
  • This means you need to make a profit (most peoples financial businesses should be bankrupt)
  • This means you need a solid team around you with experience (experience and results mean everything – the right qualifications is just the start)
  • Still thinking like an emotional homeowner and disregarding due diligence fundamentals (Emotions plus Investing = lose money)
  • Not protecting themselves with the appropriate structures and cash buffers

 

Rule 4. Focus on the portfolio, not on the property itself

 

To many people get caught up in one strategy or one deal they like or don’t like. I’ve gotta say “Get over it!”

 

It is not about the deal; it is about the result it is going to create for your life.

 

Focus on the purpose a deal may or may not serve for your overall portfolio and how it is going to move you ever closer to the dream life you want to create.

 

Rule 5. Your portfolio should stay separate from your personal life

 

Your portfolio should be separate from your personal life. As soon as these two things are tied up, it is going to equal pain at some point.

 

Your personal life is a business, your property portfolio is a business, now keep them separate.

 

Your portfolio should enhance your life not detract from it.

 

Rule 6. Property Investing is a long-term strategy

 

Stop trying to get rich quick! Read that again and let it sink in. Property investing is a long-term strategy. Think 5 years, 10 years and 15 years ahead.

 

Sure, you can create results in a short-term time frame, but put your focus on the bigger picture and building a sustainable portfolio step by step.

 

Rule 7. Wealth is a system. Wealth is a habit

 

The truth about success and wealth in any endeavour is that it is not reserved for ‘special’ people, it is not about taking giant leaps of faith and taking giant leaps outside of your comfort zone everyday or taking huge risks.

 

Wealth and success is created by taking small and consistent actions on an ongoing basis, systematically moving you towards your desired outcome.

 

Eventually these small habitual actions avalanche over into this thing called success or wealth or financial freedom or whatever you want to call it.

 

The best part all of this is that almost anyone can do it if you follow the system.

 

Make the decision to be strategic in your investing.

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