This is the one thought that distinguishes a professional investor from a beginner.
It's one thought that when you back it up with knowledge and experience you can avoid most mistakes that beginners make and do profitable property transactions.
Video Transcription
Hey, guys, Property Search... Think Gladfish. I'm Brett Alegre-Wood, and this is Property Rant.
A box that makes you money, that's how I define property. Look, I'm an investor, and no, we're not talking about your home here. We're talking about your property investments.
And so, you know, a box that makes you money, what does that mean? It means that when you're buying property as an investment, take out the emotion, get rid of the emotion, take it out, because the sooner you do that, the better.
Then you can move to where really we want to be, which is called a numbers investor. And how do we do that? Well, look, when you start off, I always say one-two-stop strategy.
And one-two-stop is always about, you know, getting the education and the emotional intelligence of an investor squared away in those first two properties, because, no matter what I say, I can say, "Property, a box that makes you money," the reality is those first two properties are going to be very emotional.
But there's certain things you can do, and there's certain steps you can take, so, the first thing is education, okay? Read as many books, go to as many seminars, do whatever you need to do to get that base level of education. And then what you want to do is go through some dry runs. If you do some dry runs on your property, act as if, okay? What do we mean by "act as if"?
Act as if you're the investor with the
£100,000, who's got the income, who does the, you know, job and ready to go. And if you act as if you're going to buy, and you do everything except buy, and you do that a couple of times, then those emotions will get in check.
They'll be under control, and that's really what we want in the first couple of properties. Look, you know, until you get to about five properties, at five properties, that's where you really become a numbers investor, where, actually, you don't need the stories.
You don't care what the salesperson says. What you're after is the hard facts and the numbers. And then when they give you those numbers, you go and check them independently. You go and ring around agents, you know? And when you do that, all of a sudden, you see just how much research they've done, and you see where the things actually are.
So, property, a box that makes you money, what does that mean? It means focusing on the financials. If you're not doing a full two-year cash flow in detail and getting those and verifying those details on a cash flow, then you're not really, you know, doing what you need to do.
Whatever they give you, whatever the salesperson gives you, whatever that aid the state agency gives you, they may say, "This is going to be the rent. This will be your mortgage. This will be your profit," Well, it might be a profit, because you've got to add all the expenses in.
So, understand and get that, and if you haven't got a cash flow, call the team and get one of our cash flows and get them to run through that cash flow with you, so you really understand just how much detail that we go into with our two-year cash flow worksheet, because it's absolutely key.
If you're going to have property, a box that makes you money, that implies it's a financial decision. And in order to make a financial decision, you need to have the numbers right, and that means a cash flow worksheet. Okay, guys, have a great day.
Live with passion.
