Politicians will keep making policies to affect property. Interest rates will rise and fall. Dollar will rise and fall. Oil price will keep on fluctuating and the world will keep on turning without much regard for our personal plans. In order to navigate through the changes and obstacles, you need to prepare in advance to weather these difficulties.
So let’s look at six strategies to help you reach your investment goals
1. Invest in your knowledge before you invest in land and house
The best place to start investing is in you. However with so much information out there, it’s hard to know who to listen to. I suggest you learn from others. Learn from those who have not only achieved the same. Also from those who have maintained their wealth over a long period of time. Not just during the last or present political dispensation. You see a rising tide lifts all ships.
Also surround yourself with like-minded people and get a mentor who will both inspire and challenge you. More so hold you accountable for your actions.
2. Marry your investment plans with your investment capital
Sure it’s exciting to have big dreams, but if the paths to them are paved with gold you can’t afford. Then your dreams run the risk of becoming dilemmas.
Remember recession will come to an end. Besides over the next few years property in Nigeria will be on the rise. So while enduring the current phase, get financially prepared for what’s ahead.
3. Use your portfolio to reduce your risk
Strategic investors look forward to best of times but protect their portfolios for the tough times that will inevitably come.
Rather than gearing to the max. They take a more prudent approach by building an emergency buffer to buy time to ride through the storms. These are often lines of credit or offset accounts they can call upon should the unexpected occur.
They own the type of property that will be in continuous demand. Even by a wide demographic of owner-occupiers in the big capital cities. This is because these locations are underpinned by multiple pillars of economic support. Therefore values don’t fluctuate widely when times become tough.
4. Do the due diligence before you do the deal (do du di do de)
While the average investors buy their properties emotionally. Sophisticated investors have an investment plan they adhere to and carefully evaluate any potential investment opportunity. All of these in light of their long-term goals.
They know that this makes their investment decisions less emotional and their results are more consistent and predictable.
5. Keep your sights set on your goals
Most investors buy property and hold it for long term. Strategic investors regularly review their investment portfolio’s performance in light of their long-term goals. This means some consider sell up secondary properties that are likely to languish in the next stage of the cycle.
- I like to look at my portfolio’s performance at least once a year:
- Are my properties performing to my expectations?
- Are they outperforming the market?
- If that property were for sale today would I buy it again?
- Does this property still fit in with my overall plan?
- You see…over time you grow, your skills improve and your circumstances change.
- Treat your property like a business and evaluate your assets dispassionately and take appropriate action.
6. Remember that in real estate, less is often more
The person who wins in the end is not the one with the most properties. Contrary to what you might believe, heaps of properties do not necessarily mean you have financial freedom life. Concentrate on getting the best deals for your investment goals, not the most deals.
When it comes down to it, capital growth is important in building wealth through real estate. Properties that outperform the long term averages always come at a price. The trick is to avoid cheap or secondary properties.
But it is a price worth paying.
You make money when you buy the right property. Your investment journey might be a long one. This means you’re likely to encounter some good economic times and some tough ones. Periods of low interest rates and high interest rates, booms in the property markets and slumps. Remember to prepare for the worst, while hoping for the best – in other words maximize your upside while at the same time covering your downside. You’ll remain in control of your destiny.
BY THE WAY…
Why not find time to talk to us at propertymatters.com on your next property deal?