Buy to let is dead is the word in the industry, and yet here I am talking about how to master buy to let property investments.
In all honesty:
Buy to let has worked for us so far and every investor I have known who invested in other strategies have always come back to investing more in buy to lets.
The issue is people do not want to stick to one strategy long enough to understand and systematise it completely and are too quick to say this isn’t for me.
Ask those who have committed themselves to one strategy to a point where they have actually evolved their own methods that worked for them.
It’s more like if you want to focus on possibilities for success or on the potential for failure. There is always a choice.
It’s more of a choice between your focus on possibilities for success versus the potential for failure. Make the right choice and you always have a business.
Here are few character traits that one needs to personalise to their journey and consistently practice them to be able to master their buy to let investments.
1) Know Your Buy To Let Market
Isn’t that the basic thing that anyone should do? You may ask.
It is indeed.
Not many go into the detail of knowing an average persona within the area and understand how the persona lives and what the persona needs as a resident.
Street Check website does give high level statistics of the population, area analysis, employment, crime rate and other information.
But, unless you walk the streets and talk to people explicitly in the streets you want to invest in, you would not be able to pin point the tenant profile you are after to buy the buy to let properties.
Unless you know your tenant profile, you probably don’t know your property profile.
If that is one challenge, the other is to be able to understand the investment areas that you need to invest in that suits your situation.
Here is an in-depth post that helps to understand how to choose your property investment area.
Your investment area changes every period and it only means you probably have to revisit your investment criteria when you witness such change.
2) Build Your Finance Pot
People say do your work and “MONEY WILL FIND THE DEAL”.
Did you hear that before?
Well let me tell you, as much motivational that may sound, the ground reality isn’t the same.
That simply cannot be your basis to start or scale your business. If that was true, every investor would have become a millionaire yesterday.
You will have to build a pot of money that will enable you to repeatedly invest within the investment process of buy, let and refinance cycle.
Within our client coaching programs we always ensure people don’t get carried away with such rosy statements and instead focus on questioning how the deal will be funded.
Solution mindset becomes a big part of such process enabling clients to creatively secure the funds.
Two simple strategies:
- Raise your own funds from your savings and/or re-mortgaging your existing house.
- Raise other people’s money to invest within your buy to lets.
You may want to refer to this post to understand how to raise investment to grow your buy to let portfolio.
3) Build Your Team, However Challenging This May Be
I say however challenging this may be.
By far, that’s the biggest challenge we have had. Building our power team.
We probably have done the journey twice in last 3 years building our team and losing them too for one or the other reason.
Gladly though we have now settled down with some great team members who help us with our lettings / maintenance / conveyancing / mortgages / architecture with few challenges still in the build department.
You are able to build such a team with lesser conflicts in the journey only when you mutually align on your values and buy-in to each other with mutual trust.
Easier said than done, but certainly possible.
You may want to refer to this post to understand in depth on how to determine your core values which will help a lot to understand the team you need to build.
Looking to build your power team from scratch? Then here is a start point to understand the platforms to find right tradesmen for your property renovation.
4) Retrospect To Evolve Your Own Systems
Over a period of time investing in any property investment strategy, you will come across those areas which dents your Cashflow, your motivation to invest and ability to scale.
If you don’t take a step back and retrospect on what happened last few months and where exactly you have put a wrong foot, you will not be able to define a system that suits you.
You can only evolve your systems if you retrospect with three simple questions.
- What Went Well
- What Needs Improvement
- What Actions Should You Take To Improve
As a quick guide on how a retrospection should look like, here is a retrospective session we did at Limitless Monks which you can mimic each quarter.
Here is a bonus viewings system……..
5) Stick To Your Offers Process
One of the biggest issue resulting in people failing to scale their buy to let business year on year is not being able to stick to their numbers.
When we started our investment journey, we did fell for this too. Those little emotions get better of you and create the urge to build your portfolio quicker.
We just created a small offers process for ourselves which held us in those times of emotional turbulence assessing a deal.
That process in summary while we call it a deal profile as pictured below where a combination of your ROI / Cashflow / Money Left In The Deal as a system has to work for you to be able to increase your offer.
While that’s just a summary of it, it’s worth you reading this post for a detailed offers process.