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Three keys to building a multi-property portfolio

By Bianca Dabu 05 April 2016 | 1 minute read

Many property investors building their portfolio fail to go past the one- to two-property mark due to different factors, but Right Property Group’s Victor Kuma r— who has embarked on an 18-year property investment journey and has built a career as a buyer’s agent — believes that there are only three vital steps to growing an impressive multi-property portfolio.

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Years of working with a variety of investors looking to create wealth through properties have taught Victor about the hurdles they face as well as the wide array of opportunities they have to rise above them.

Going from one property to twenty over a period of time may seem like a great feat for many, but it could not be too hard for anyone who is driven by passion, according to him.

The first step to Victor’s three-part road to success is having the right mindset.

“Get away from your current environment if your current environment does not support multiple property ownership,” the buyer’s agent said.

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“If ... you want to be a prolific investor, you need to go to networking functions and stuff where you can rub shoulders with [people you want to be like]. That’s the very first thing—you need to have the right mindset.”

After essentially “getting your head in the game,” his next advice for property investors is to look back and reflect on the goals they have set when they started their journey of wealth creation.

According to him, an investor whose goals are always clear on his mind, no matter how much they change, will find it easier to lay out strategies to minimize any negative impact and ultimately lead him to success.

“Why are you doing this? Make that ‘why’ really, really count because if the ‘why’ is clear enough, then the ‘how’ will happen by itself… You need to focus on what you are trying to achieve in one year, three years, five years, and ten years in your portfolio,” Victor said.

“You know that in the initial stages, what will happen is you will have an element of negative cash flow regardless of what type of property you buy… You need to look at how much of the negative cash flow you can sustain and whether it will have an impact on your lifestyle or not.

That’s what slows people down—if investing starts impacting on lifestyle, obviously, a part of you will say, ‘No. Let’s slow down. It’s not pleasurable.’ We try and shy away from pain, but property investment causes pain, so we stop.”

Lastly, Victor said that property investors must learn to choose the type of property they buy based on their own skill set instead of simply following trends. Matching your investment properties with your capabilities as well as your limitations will help you manage them well and determine the role they will play in your long-term journey as part of your property portfolio, he said.

“We need to work out what type of property are we buying to match our own skill set. If you’re a good renovator, you’d buy properties that you could renovate. If you’re time poor, you’d buy properties that you could get other people to renovate… or just buy properties that don’t need renovation,” the buyer’s agent explained. 

“If you map out those simple things, you’ll find that it starts unfolding. You have to look at it on a weekly basis to say, ‘Where am I heading with this?’”

Tune in to Victor Kumar’s episode on The Smart Property Investment Show to know more about his biggest investment mistakes and what he did to keep the wheels in motion, as well as his insight on where the property market is heading.

 

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Property

Property refers to either a tangible or intangible item that an individual or business has legal rights or ownership of, such as houses, cars, stocks or bond certificates.

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Three keys to building a multi-property portfolio
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