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Stepping Up From Small Player To A More Serious Investor
Once you have a first taste of real estate success, you will start to realise for yourself that real estating can in fact truly give you financial freedom. Success breeds confidence. And you have to now take it to the next level in order to cash in bigger profits and cash flow.
Before taking action on taking investing to a higher level, you have to first ask yourself whether you are tolerant to the inherent risks. As you know, going for higher returns will always mean higher risks. Some people are natural risk takers while others are instinctively allergic to risks. As there is no right or wrong approach to your risk appetite, you have to decide yourself if going further and deeper into properties is you cup of tea.
You can of course go for deals that duplicate your initial successful deal. There is nothing wrong with that. Why change your strategy when you already have a successful one in place correct? If you had made $100,000 from your first success, we can simply say that it will take 10 of those similar deals to squeeze out $1m. Or if you want to hit that million dollar mark sooner, you can go for deals on a larger scale.
How to start?
Go for bigger fish. When you first started out on this journey, your prime objective was probably just to find a place to park your money so that your cash does not lose it’s value due to inflation. But as time goes on and you start experiencing cash inflows for real, you will undoubtedly be tempted to think about using properties as a retirement vehicle. And to do that you need more deals or bigger deals with stable tenants.
The most stable tenants that will honour their tenancies and pay promptly are commercial ones. Just compare a bank and an individual and you will clearly see the difference in calibre. Think about how you can secure big organisations as your customers. Having a piece of premium commercial space will be great. But if that burst your budget, you can target their employees by providing accommodation. Even billion dollar corporations look up small time property investors for accommodating their staff.
Multinational companies have their staff travel from country to country very often. Yes frequent travellers often check into a hotel. But employees in short term visits will need accommodation. Interns fly around the world often to get exposure and they often travel for 3 months or up to a year. The same with management trainees. If your apartment is attractive to the organisation in terms of location and feasibility, you can pitch your apartment to them. They have huge allowances and want the best for their staff. So you can be assured that they will fork out the cash as long as you are providing quality.
Continuous learning. The only constant in the world is change. You are signing your own death note if you stand still and refuse to pick up new stuff. Your ego is the biggest obstacle to continuous learning. If you think that you already know it all, think again. There is too much information for any one person to fully learn in a lifetime. Educating yourself will eliminate a lot of risks while you get more confident in taking action. You can continually pump up your information hard drive by talking to experts, attending seminars, and reading the newspapers and books. Just picking up one great idea on an activity can reap your great rewards when you successfully apply it.
Build a team of capable experts. As the deals get bigger, you will soon find out that your expertise alone will not be enough. You need capable people around you to look out for your best interest and warn you of potential pitfalls. You can hire them yourself or hire them as third parties. There are entire industries built around servicing real estate investors like you. They come with great experience due to the volume of deals they get involved in, and also charge you only when a deal is done. This is a no-brainer. Stop keeping your cards and money to yourself and start spreading your wealth by hiring real experts to help you. Your wealth will explode when you start sharing it.
Learn marketing. Everything involves marketing. Getting to the next level of investing requires you to pick up marketing skills. There is a reason why good deals always seem to fall onto the lap of a select few individuals or organisations. It is because they market themselves very well. Not only does effective marketing give you great exposure to the people that matters to you, it should also communicate good qualities that make people want to work with you. If you can find the right formula that works for you, you are going to find opportunities that knock on your door everyday.
Getting a mentor. There is a reason why people who work for successful people achieves success faster. It is because mentorship works. You might be a maverick or an investment phenomena. Whatever your case, a good mentor is going to help you level up either in a shorter time or in a bigger way. You will be more than thankful if your are going through a complex deal that involves a whole building and there is someone in your corner who has done deals like this many times over. However, choosing a mentor is a tricky proposition. “Gurus” these days create free workshops with offers to be your mentor. They will then “mentor” you into buying a property they are selling or promoting. The best mentors are those that does not have a stake in financially benefiting from your deals.
Carve out a positive attitude. You don’t have to jump out of bed every morning and shout “Show me the money!”. But you need to have a positive outlook of things. A moody negative mindset will not take you very far. It can be challenging when you are taking on a big deal for the first time. Take it in your stride and going about it with the unwavering belief that you can do it. Going into depression for fear of failure will take you down and your whole team along with you.