Mistakes landlords make and how you can avoid them
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Mistakes landlords make and how you can avoid them

Mistakes landlords make and how you can avoid them

by Sasha Karen | October 08, 2018

What are the vital differences between landlords and investors? We speak with experts who explain how even seasoned property owners get caught out focusing on one over the other.

Woman working and maintaining cash flow

According to Victor Kumar, director of Right Property Group, it’s important to know that landlords and investors are two separate functions – and both roles need to be approached in slightly different ways.

“If I can put in quasi-terms, an investor is someone who’s chasing the gains, chasing the end goal, but to get to the end goal, you also need to be a landlord and make sure that your properties are rented, your outgoings are minimised and you’re not buying something that’s going to be completely sucking all of the cash flow out from you, and therefore stop you buying your next one as well,” Mr Kumar said.

While as an investor it’s important to hold on to good tenants for cash flow purposes, some experts recommend investors should not fall into the trap of over-focusing on landlord duties, as you can lose sight of the ultimate goal of an investment property, according to Aaron Christie-David, managing director of Atelier Wealth.

“As part of the team, if you’re the CEO as the investor, your property manager’s one of your managers, right? Just like your accountant, your financial planner, your mortgage broker,” Mr Christie-David said.

“I'm using the definition that landlord’s someone that kind of micromanages and you’re going to sit there and vet the tenants and snoop over there and have a look at the property; you’re like a small business owner that is on the tools all the time that can’t actually come up to be the manager,” he said.

“People that can scale their business are the ones that can hire well, can grow their business systems and processes – same thing for a property investor,” he said.

“They’re the ones that scale well, will use online platform, systems tools, check in with everyone; they’re not sitting there looking at their daily interest rate going, ‘Where's it going?’ and ‘Rent's one day late’. That’s up to a property manager,” he said.

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