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Investors are frequently urged to do their due diligence before making any property-related decisions, but when does research cross the line and become procrastination?
How do you learn? Do you like to test and measure, and check and re-check before you enter into anything, armed to the teeth with information? Or do you prefer to just get a basic understanding and then plunge in, figuring that you can always figure it out later. People learn differently, and some people learn and learn and learn and then… forget to actually invest!
Education underpins the portfolios of all successful property investors, and as property investment educators, we spend a lot of time painstakingly detailing the ins and outs of property investment through our various guides and resources. Usually, when someone makes a poor investment decision, it's because they don't have all of the necessary information at the time of purchase, and this can have an effect on their capacity for further portfolio development.
The idea of the ideal property investor as someone armed with ample information and confident about buying seems like a great notion – in theory – but the reality is that no matter how much information some people have about property investment, they will never take the plunge and just buy something. This may be because some people feel like they have to know as much as they can and never feel confident enough (due to the huge amount of contrasting information out there), or other doubts might come into the picture.
So what are some of the common causes of property procrastination?
Listening to non-investors
Property, it seems, is one of Australia’s favourite conversation starters and pretty much every man and his dog has an opinion on property investment – where to buy or not buy and where's going to boom or fall into a slump. Much of the time, these are just opinions regurgitated from something that someone’s read in the paper, not based on in-depth research. Of course, if you know they've done their research, by all means, listen (maybe they are a good mentor!). The problem is that sometimes, the people doling out advice are family and friends – and these people, although you trust them, might not be the expert they think they are, and thus not necessarily the right person to trust in this instance.
When they express horror at your idea to purchase in Brisbane, just stop and think about all the research you've done and how sure you are. If you've taken the time, done your due diligence and are pretty sure the property will do well, but your friend/family member nixes the idea, you just have to trust yourself and have faith that you're doing the right thing. You, after all the research you’ve done, could, in fact, be more of an expert than them! The bottom line is: If you've done your research and feel confident, then stick to your guns, and maybe think about bouncing your ideas off a buyers' advocate in a free consultation.
Ruminating on the negatives
With property investment, what can possibly go wrong? Well, if you look at it objectively, there is plenty that could go wrong – and if you fixate on the negatives, these possibilities can paralyse you with fear and stop you from acting. As with any investment, there's always something that can go wrong – bad tenants, vacant periods, interest rate hikes, damage or repairs... You could ruminate on the negatives all day, but the reality is that the positives will outweigh them. You just need a plan in place and a buffer of money that is sufficient to protect you. That way, you don't need to worry about unexpected changes, because you’ve educated yourself and have already planned ahead as much as you can't predict them.
Some people have the belief that they need to have a lot of money to invest in property, but with the right strategy and planning, property investment in Australia is a very attainable goal, and you don't need to have buckets of cash. A deposit or even the equity in your own home is sufficient. From there, it's simply a matter of relying on the research that you've done and following a property investment plan to secure your finance.
To all the procrastinators out there, if there's one thing to take away from this: In order to be a property investor, you actually have to invest in property and buy something! In the property investment world, there are a lot of chronic procrastinators who spend heaps of time reading the magazines, attending the seminars and engaging mentors, yet still haven't bought anything. Whether it's for one of the reasons above or because they don't have a great team of people around them, the fact is that they are property procrastinators. Don't let doubts rule your head – get ahead with information and education, and start your property investment journey today.
And don’t forget, if you've been reading and educating yourself for a while now but still haven't bought anything, it might be time to engage a professional who can map our your property wealth strategy and kick-start your portfolio.