The Best Property Investment Tip I’ve Ever Received
Ready for a piece of absolute property investing gold? Brace yourself! This is one of the best pieces of property investment advice I’ve ever received, and once you understand what it actually means, it can change everything for you.
Good property investors buy time.
Sounds simple, right? And it is! But so many property investors don’t seem to understand or follow this, so let’s talk about what it means…
How long do you think it would take for you to make money on an investment property if you purchased it today? One year? Three years? 10 years? How about 20?
Most people would say 3 years, but I can’t think of anyone who would expect to make $0 on an investment property by year 20.
The funny thing about time is that it tends to make even the worst property investor successful, as long as they keep holding onto that property for long enough. It doesn’t necessarily mean you won’t make money for 20 years (with the right choices, you’ll make money MUCH sooner than that!), but it does mean that you are guaranteed to make money eventually if you just hold out.
This is the secret to success in property investing. Buy properties with the intention of holding them for 20 years! If you do this, you won’t go wrong.
I can’t think of any place in Australia, even the worst-hit mining towns, where today’s property prices are lower than they were 20 years ago.
So, how do you buy time?
You can buy time by structuring your portfolio and managing risk so that your property is set for the next couple of decades. You don’t have to worry about what’s going to happen, because you’ve covered your bases and you’re sticking to your plan.
Here are some of the factors we look at with risk management and structure:
- Financial structure
- Ownership structure
- Cash buffers
- Insurance policies
All of these factors (and more) are important when it comes to setting yourself up long-term. It’s about much more than just choosing the right property in the right location if you want to go the long haul.
Get a team in place who are experienced and trustworthy, who will help make sure every box is checked and you’re set up properly.
So, above all else, buy TIME and you won’t go wrong.
Happy property investing,
Daimien J Patterson