References aren't worth the paper they are written on. When you get enough references together in one place the subject starts to look like a guru and some type of property hero. When you have been around for long enough you know that guru's and the like, end up tarnished.
Investing in property is about what you know and more importantly what you don't know. The role of the Buyer's Agent is to fill in what you don't know.
Most of what I have ended up learning about property investing has come from experience, I was learning the most when I was making a mistake.
My business partner Dave, had bought 8 units will he was still at uni and he was already at 14 properties before he started building a block of 74 units age 28.
We both had a very ad hoc approach to investing strategy and what types of property investments we were prepared to get involved in, houses units, commercial, industrial, etc.
Between Dave and I, we had renovated, built and sub-divided over 140 properties, on our own and in joint ventures. We made a load of mistakes, but boy we got smart.
My last purchase in 2006 before GFC was a $1.87M 6 bedroom house in Dover Heights looking straight at the Sydney Harbor Bridge. And boy did I get smart from that one. During GFC the cost of funding went through the roof.
Then GFC dried up funding for a few years and some property had to be sold along the way. More smartness.
5 years ago Dave and I talked about how we could do property in a new way, one with less risk. We wanted a way that took most of the speculation out of the investment equation. In the end we came up with the current model. It was all the things we knew that made investing in property less risky.
...now we only buy new stock, we don't renovate anymore or do sub-divisions. We buy, we hold. We don't like risk, I mean we really don't like risk.
We buy for capital growth first, yield second and for a long term hold. After a while our wise friends could see what we were doing and wanted in. We started buying for a few for friends and that grew into a few more and so on. Now we buy 8-12 properties per month.
We have a saying: we are smart because we learn from our mistakes, however our clients are WISE because they have learnt from ours.
We do everything that we can to reduce the risk in the transaction, as well as deducing the risk in the investment.
The one thing Dave & I have learnt over the last decade is that TIME is the most important ingredient in investing. A bad investment wastes your time, and thats time you can't get back.
What to ask your Buyer's Agent
What area do they recommend and why?,
What?s changed?
Why has it changed?
Is it a short term change or a long term change?
Is it near where the Buyer's Agent lives and if yes, why?
Where is the State in it's property cycle?
Where is the town or city in it's property cycle?
Where is the Suburb in it's property cycle?
Are the number of property sales in that suburb on an increasing trend?
and so on.
Do everything can to avoid buying a dud.
