Todays rant is a question from an investor – I have said for years that you can make money from property in hundreds of different ways but the people that lose are the ones that… watch the video and find out…
I also cover the 3 reasons for me doing residential property, number 3 might surprise you but it’s the reason I spend so little time managing my portfolio... and you will too!
Hey guys, Property search... Think Gladfish. I'm Brett Alegre-Wood, and this is Property Rant.
So today a question from one of our investors, and the question is, "Why do you do residential and not any other form of investment?"
And actually the...and I'll get to the question first, but...obviously the question's second...but before I say that, I have got other investments. I don't just invest in residential property. I've got wine investments. I've got businesses as investments. I've got stocks and shares.
So, I've got that sort of stuff as well, but my primary way of making money, if you like, and creating wealth myself is either through businesses revolving around property or investing in properties. And that could be building properties, managing properties, selling properties, whichever.
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So, I have a number of different businesses, but yes, they are primarily about residential, and I'm primarily about residential and for over 20 years, pretty much residential is what I've done. I have done some other bits and pieces but residential is what I know, and here's the three things that I think and the reason why I choose residential. And first of all, before I say that, there are thousands of ways to make money. Whether it be in property, whether it be in business, in fact, probably millions, hundreds of thousands of ways to make money.
The trick to it, and this is a mistake that most people make is that what they do is that they go and have a shotgun approach. So, what happens is they go along to a seminar. They read a book, and they think, "That's great. That's what I'm going to do." And then what happens, they follow that way, and maybe they make an investment, and then before you know it, they're on the website. They go, "Ooh, that looks good. Let's do that, and let's do that, and let's do that, and let's do that." And all of a sudden, they've got this shotgun approach of investments all over the place.
And the key here is it's impossible to know the rules of the game. So, my first point about this is that the reason I do residential, and the reason I know residential really well is because I know the rules of the game.
If you give me commercial, yeah, I can talk generally, and I can have a few beers and chat with the boys about commercial property, but would I invest my millions of dollars and that sort of stuff into commercial or whatever? Then probably not, actually, because I don't know the rules of the game well enough to commit that sort of money, all right?
Whereas residential, I do, so I'm happy to do that sort of stuff, and that's one of the keys here. If you're going to do something, whatever strategy you choose because there's thousands of ways you make money, choose a strategy where you know the rules of the game. And if you don't know the rules of the game, make sure you're on the path, and you're learning them. and you're staying focused, yeah, because I can tell you the moment you have some money, and the moment you have some capital invest, you'll be surprised how many investment ideas come to you, and they're all going to make you a millionaire in three to five years, or overnight, or whatever, and for the most part, it's absolute BS.
So, first, know the rules of the game.
Second is that I'm a set and forget investor, so I like to set up my investments and forget about them on a day-to-day basis. Yeah. Now I don't truly ever forget about them, all right, but the reality is, I don't want them impacting my lifestyle. What I'm passionate about and my passion is that the things I enjoy doing. I've got four kids, I live in Singapore. My family's in Australia, and my businesses are in the UK. I love traveling, so last year in 2016, 17 different countries I went to.
So, the reality is when you start looking at that sort of stuff, that's my passion. Property is the vehicle, and residential property is the vehicle that gets me there. So, by being a set and forget investor, and this is a distinction, a key distinction, investor not landlord. A landlord manages property. An investor expects a return on their money. So, you want to be an investor, not a landlord. Now, that's not to say that your strategy may be to be a landlord, yeah, because you can squeeze every last pound out of that particular investment, all of that sort of stuff, and that's something you're interested in, great. It's just that you're not probably going to be with my client or mine. My clients are the ones that don't have the time to put into the investment, so they outsource, OPTOPM, other people's time, other people's money, those things.
And then the third...so the first one going rules of the game, second is set and forget investor and the third is what I call...some people say control freak. I call it delegate the task, yeah, but not the responsibility. So, whatever I'm doing in property, I know that I'm ultimately responsible. I'm the one signing the mortgage deeds, and because of that, I want to be involved.
So, I want to know what's going on, and I want to have a high level overview of what's going on before decisions are made. But that doesn't mean when it comes to managing properties and that sort of stuff, I don't get involved in that. I leave that to the experts. I hire competent people. I pay them well, and they do a good job, and they make the decisions for me. Or if they have to, they'll come to me, but they'll come to me with a solution.
And that's one of the key things. If you're working with people who come to you with problems and expect you to solve them, then you need to sack them. You need to get somebody else. But, guys, so there's three points. Basically, you have to know the rules of the game, be a set and forget investor, and delegate the task, but not the responsibility.
Okay guys, have a great day. Live with passion.