Many investors choose to rely on a team of professionals to assist in managing their assets and make the most out of their properties, but as in most fields, one must be careful in choosing who to trust.
David Shih learned this lesson the hard way when he took a recommendation from a remote property manager for a builder who shall lead one of his properties’ renovation in Queensland.
“That was a remote reno that I was doing for my property. What happened was, because we had so much trust in this remote PN, unfortunately, I didn’t go check myself on the licences of the builder,” he told Smart Property Investment.
He added: “I think at that time, yes, he was recommended, and he was good. He showed me a couple of his works as well and it looked really decent.”
David was able to meet with the builder on-site a couple of times, and they eventually established rapport. The builder showed his plan and asked for a deposit to commence the project. After signing a work order, agreeing on a start day, and paying $4,000 worth of deposit, David never heard from the builder again.
The regretful investor spent over a year tracking him down, but to no avail. Little did he know that he was not his first victim.
“I’ve actually touched base with other investors who have also been burnt by (the same guy). Some of them are actually in the midway of renovation, and this guy just disappeared. They ended up having to spend more to fix it up,” David said.
Lesson learned: Do your homework. The Smart Property Investment Show host Phil Tarrant said that investors could really get obsessed in the moment of renovating or the dream of building wealth through property that they forget to take the necessary precautions.
While risk in the property market is truly ever-present, an investor can avoid being burnt by being meticulous in forming their team.
David concluded: “Don’t trust on face value. You still got to check all the licences, do all the right things before you sign that work order. There’s always risk associated, so definitely do your homework. Be careful about what other people claim that they could be.”
Tune in to David Shih's episode in The Smart Property Investment Show to know his thoughts on property procrastination, loan serviceability, and financial freedom.