Let me say from the start, that what I am about to say is not to encourage you into debt, at least not recklessly taking on debt. I would not expect anyone to adopt the principles I am about to outline unless they were absolutely sure of what they are doing and the possible consequences.…
Sensitivity Analysis graph (du dil 7)So far we have been thinking about single factors or one-off events. But the property market is highly complex and there are numerous things that can affect the performance of the market as a whole, and individual properties in particular. So you might want to do an analysis that considers…
Let’s have a more detailed look at how we can do some risk analysis. Often the different scenarios are not as black and white as our rudimentary analysis suggests and we might want to assess the risks of, and look at the consequences of, events within a range of possibilities. What do I mean by…
Having asked the relevant questions, you may identify a scenario that could happen. Whether it is, in reality, a worst case scenario is to some extent subjective and probably a matter of semantics. But if you have identified a possible negative outcome of owning a particular property, you will need to clarify what this means…
In my experience, from having spoken to, and from having coached, numerous would-be investors, in most instances the limiting belief behind both of these behaviours is “fear” – usually the fear of making a mistake. This in turn feeds the fear of “losing everything”. This might sound very bleak but, again in my experience, without…
I’ll give just a word of explanation about the question “Am I paying too much for the property?” This isn’t necessarily implying that you check that you are not paying more than the open market value. It is suggesting that you check against whatever criteria you have set yourself to recognise a good buy. So,…
Thinking of the three principle property investing strategies, we could ask a series of questions like these: If our strategy is to buy and hold property for income: Am I paying too much for the property? Will I be able to let it once I’ve bought it? Will I be able to obtain the rent…
When you say the term “due diligence” to most investors they will naturally think about the basic checks anyone undertakes before buying a property. In fact, most investors will probably think of due diligence as being something they do after they have agreed terms to buy a property – having a valuation and survey, appointing…
The next step in overcoming fear is to recognise that often fear is caused by, or fed by, ignorance. The antidote to ignorance is information and knowledge but of course it needs to be the right knowledge. Strangely many people are not discriminating in choosing their source of information. A good example of this is…
A key part of our cure for fear of failure is to remember that property investing is not about emotion. When I first started I had limiting beliefs, fears that expressed themselves in ridiculous ways. I know it sounds silly but I found it extremely difficult and uncomfortable going into estate agents offices and registering…