John D. Rockefeller, considered one of the greatest American magnates, once said, “The major fortunes in America have been made in land.” As one of the most influential and most business-minded men in American history, he probably didn’t come about this realisation through mere chance. He likely came to this conclusion through purposeful and intentional moves, akin to running a business.
This is the approach that property investors need, too. Many are simply relying on fortunate circumstances in order to secure a good property. But this isn’t a viable blueprint to follow. Strategy and foresight will trump luck in terms of property investment and are necessary to succeed in the U.S. property market. So in order to thrive, you have to view property investment through the same lens you would view running a business.
Good businesses succeed with thorough planning and with their eye on long-term success rather than just short-term gain. Sustainability plays a big part in a business because you want it to continue running long after its inception. Good businesses are also consistent and follow a model in order to ensure that they’re reaching their established goals.
Treating property investment in the U.S. like a business furthers your chances of good investments and the maximisation of these investments for success.
Why is property investment a business?
Getting into property investment without a plan is risky as it leaves you without any success indicators and a pretty flimsy way of going about things. Sure, there’s still a possibility of doing well, but there are no actual guarantees in place—and you don’t want that.
Being able to operate from a business standpoint at least gives you the stability you need to measure success, identify how you can go about an investment and a business plan you can constantly look back on and revise or review if necessary. This plan should include your goals, what you want for your future, and how you will get there.
Property investment requires consistent work. You can’t just expect it to work out after setting everything into place once, it has to be continuous and constant, with you always reviewing your plan, going over properties, and weighing up if an investment will be a good one or not. Like a good business, you can’t expect it to run smoothly if the work is inconsistent and the quality is lacking.
It’s also difficult to tackle property investment alone because of how complex it can be. Several experts in different fields need to be part of your team in order to maximise success. In a business, a team works together to reach a certain goal or hit a certain mark. Having a team in a business can ensure productivity and efficiency as different people can work on different things that cater to their skills.
Investing overseas is a business because you need to be strategic, have a plan in place, and work as a team to succeed.
5 ways to turn U.S. residential property investing into a business
It may sound difficult to shift how you operate in terms of property investments but these five methods can help you turn it into a business.
1. Capital helps you get started
Getting a headstart is never a bad thing and one good way to do so is to secure capital. Just like businesses need capital, property investment does, too. You need that money in order to fund any venture, even real estate ventures in the U.S.
Capital can cover the actual cost of the investment and even the fixes or renovations you plan to make to the property.
Finding capital can be the tricky part. Money can be a difficult thing to procure but there are three possibilities, especially for investing in the U.S: Joint ventures, land contracts, and private equity.
A joint venture is when two people come to an agreement and invest in a property together given that you have complementary skills that will benefit you both when it comes to the property. Say you’re more savvy with the real estate market and pitching the property and someone has the capital and the maintenance power for it. Investing together and using both your skills will help you make a sale.
A land contract is when you secure a property and make payments to the vendor or owner for it over a certain amount of time. More often than not, the house is still in the owner’s name until you’ve fully paid it off.
Private equity is, as the name suggests, a private pool of money used to directly invest in other companies or ventures. It’s an alternative way of financing that is flexible in terms of loans, making it easier for foreigners to invest in U.S. property.
2. Be in it for the long haul
Be real, there’s no recipe for instant success when it comes to both business and property investment. It takes a long time to lay out your plans, to set them in motion, and to receive the spoils of your effort. There’s nothing instantaneous about either of the two. So buckling in and being patient is all part of it.
Instant gratification is something we all look for now. We want everything quicker, to get results faster, and for things to arrive on demand. Sometimes we settle for short-term success because we want to succeed right away, shrugging off the possibilities for the long-term. But it goes without saying that if you want long-term success, like a good business aims for, you have to have the tenacity to stick with your plan. The rewards of short-term success will probably fizzle out just as quickly as you attained it, which is why you should aim for something more permanent and sustainable.
Stan Lee, for example, was about 38 years old when he contemplated parting with Timely Comics and creating his own set of superheroes to rival that of DC’s. When he did, he created an entire universe that’s become so well-loved that it paved the way for dozens of movies and series and an entire web of crossovers. With patience and perseverance to create something that he loved, he was able to find success.
3. Time and effort sets up success
Putting in the time and work every day to research your property/ies is also important. 
Just like putting together a business, you can’t haphazardly slap it together. You have to take the time to review the right people for the job, where they fit, how the business model works, and what you count as a success indicator. Effortless, lazy work yields sloppy results. The same goes for property investment.
If you don’t put in the time and effort in finding good prices, identifying the best investment opportunities, making good renovations, and working with the right people, you can compromise your success on a property. By putting in time and effort into these four areas, you can set yourself up to thrive. If you don’t, you will end up paying too much for a property, having shoddy renovations, and even find yourself stuck with an unreliable team. Like we said earlier: Effortless, lazy work yields sloppy results.
4. Finding (and hiring) the right help
No matter how good your vision is in a business or in property investment, you’re only as good as the team you hire. If you get the wrong people, you’ll fail to attain that vision. Being able to find good people to help you in the capacities you need them to will be vital to what you picture the property to be.
Just like in a business, you should screen people, look at their strengths and weaknesses, and the skills they have, as well as any references they can offer. If they align with what you want, they can certainly help you out.
When investing in property in the U.S, you need property managers, maintenance contractors, and real estate agents.
A property manager will deal with tenants head-on and have the keys to your property. They’ll be the ones to handle the tenant. Having a good property manager ensures that they will have a pleasant relationship with a good tenant, keeping the property safe from damage and both the tenant and property manager happy with how they interact with each other.
A maintenance contractor is in charge of the renovations and repairs and, as their name implies, the overall maintenance of the property. Keeping the property in tip-top shape will keep you from shelling out more money for small fixes that could have been avoided.
A real estate agent handles the “selling” of your property to a future tenant. A good one will ensure that they buy at the right price and will pitch your property well, showing off all the good aspects and playing up strengths.
5. Commit to reinvesting
One clever business practice is reinvesting, the act of purchasing additional shares from what was invested before instead of receiving the profit. It sets up a business for success in the long-term and can help grow profit exponentially.
This goes for property investment in the U.S.
Take Warren Buffet’s investing career as an example. He started out in high school with a friend, buying a used pinball machine and installing it in a barber shop. It did so well that the two, instead of settling with the money they’d earned, reinvested in more machines and installed them in more shops, growing their profit.
Instead of cashing in right away, reinvesting can help grow the distributions you’ll receive in cash by an exponential amount. Rather than investing in one property and stopping there when you get your desired amount, use that to invest in another property since the U.S. property market is booming. You’ll definitely find other property investment opportunities that can bring you more profit.
Investing in property in the U.S. is a great opportunity right now, but going into it blind and without a plan can hurt your investment in the long run. Being strategic in implementing goals, and going about it like a business will bring you the success you need in the market, promising you even more of it the more you do it.
If you’re interested in pursuing property investment overseas and need advice, download our guide, specifically on investing in the U.S – “7 Simple Secrets to Investing in U.S. Property”. Let me know what you think!
Linz’s Musings – The herd mentality…
/in Archived, Uncategorized /by Lindsay StewartI was talking, earlier this week, about changing your mentality and treating your property Investment as a business, rather than just an investor…
While this can be a massive change for some, it is just a small step for others, particularly when looking at overseas markets, this generally is a different class of investor.
There is however, another mental change to make, and this can be all the more harder to shake…
And that is to avoid the ‘herd mentality”.
So, what’s that, I hear you ask.
Well, the past 12 months have been classic examples of it…
Herd Mentality, by definition from the Oxford Dictionary, is “the tendency for people’s behaviour or beliefs to conform to those of the group to which they belong.”
That is, when most advice (media, property groups, peers, your uber driver etc) suggest it is a good time to buy, investors buy… or vice versa.
As an example, lets take this time 12 months ago… Pandemic had hit, HARD, and most of the evolving markets throughout the world were caught up in FEAR.
Australia/New Zealand/U.S. was set for recession (at best) or depression (likely) and ask anyone if it was a good time to buy property, you would have been told “Are you Crazy??!!”
When in fact, that was a perfect time to buy…
Now, markets have rebounded (strongly) and in the U.S. alone, are up over 10% year on year.
So, ask ‘Alex from Facebook’ now, and the consensus will be “What, haven’t you bought yet?? Why not?! Hurry or you will miss the wave…”
When really, now is the time to be cautious.
These past 4 – 6 weeks, I have not got many properties under contract, not because of a shortage of options (so-called ‘deals’ are being sent to be every-which-way) but because many are priced too high.
And while this may seem to sound easy, it is in fact difficult.
Who has been to an auction, and had a price in mind they had determined to pay for a property, but got caught up in the heat of the moment and paid too much in the end?
Yes, most of us have…
To go against the herd, or the flow is difficult.
This is such an important point, I will go into more detail on this in the coming weeks, keep an eye out!
Even as the famous Warren Buffet said:
“We simply need to be fearful when others are greedy and to be greedy only when others are fearful.”
If everyone is doing it, maybe it is a good time to pause and reflect…
If the deal is great, then grab it… but is it really? Careful not to get caught up in the herd.
To reap the benefits, U.S. property investment must be a business
/in Archived, Uncategorized /by Lindsay StewartJohn D. Rockefeller, considered one of the greatest American magnates, once said, “The major fortunes in America have been made in land.” As one of the most influential and most business-minded men in American history, he probably didn’t come about this realisation through mere chance. He likely came to this conclusion through purposeful and intentional moves, akin to running a business.
This is the approach that property investors need, too. Many are simply relying on fortunate circumstances in order to secure a good property. But this isn’t a viable blueprint to follow. Strategy and foresight will trump luck in terms of property investment and are necessary to succeed in the U.S. property market. So in order to thrive, you have to view property investment through the same lens you would view running a business.
Good businesses succeed with thorough planning and with their eye on long-term success rather than just short-term gain. Sustainability plays a big part in a business because you want it to continue running long after its inception. Good businesses are also consistent and follow a model in order to ensure that they’re reaching their established goals.
Treating property investment in the U.S. like a business furthers your chances of good investments and the maximisation of these investments for success.
Why is property investment a business?
Getting into property investment without a plan is risky as it leaves you without any success indicators and a pretty flimsy way of going about things. Sure, there’s still a possibility of doing well, but there are no actual guarantees in place—and you don’t want that.
Being able to operate from a business standpoint at least gives you the stability you need to measure success, identify how you can go about an investment and a business plan you can constantly look back on and revise or review if necessary. This plan should include your goals, what you want for your future, and how you will get there.
Property investment requires consistent work. You can’t just expect it to work out after setting everything into place once, it has to be continuous and constant, with you always reviewing your plan, going over properties, and weighing up if an investment will be a good one or not. Like a good business, you can’t expect it to run smoothly if the work is inconsistent and the quality is lacking.
It’s also difficult to tackle property investment alone because of how complex it can be. Several experts in different fields need to be part of your team in order to maximise success. In a business, a team works together to reach a certain goal or hit a certain mark. Having a team in a business can ensure productivity and efficiency as different people can work on different things that cater to their skills.
Investing overseas is a business because you need to be strategic, have a plan in place, and work as a team to succeed.
5 ways to turn U.S. residential property investing into a business
It may sound difficult to shift how you operate in terms of property investments but these five methods can help you turn it into a business.
1. Capital helps you get started
Getting a headstart is never a bad thing and one good way to do so is to secure capital. Just like businesses need capital, property investment does, too. You need that money in order to fund any venture, even real estate ventures in the U.S.
Capital can cover the actual cost of the investment and even the fixes or renovations you plan to make to the property.
Finding capital can be the tricky part. Money can be a difficult thing to procure but there are three possibilities, especially for investing in the U.S: Joint ventures, land contracts, and private equity.
A joint venture is when two people come to an agreement and invest in a property together given that you have complementary skills that will benefit you both when it comes to the property. Say you’re more savvy with the real estate market and pitching the property and someone has the capital and the maintenance power for it. Investing together and using both your skills will help you make a sale.
A land contract is when you secure a property and make payments to the vendor or owner for it over a certain amount of time. More often than not, the house is still in the owner’s name until you’ve fully paid it off.
Private equity is, as the name suggests, a private pool of money used to directly invest in other companies or ventures. It’s an alternative way of financing that is flexible in terms of loans, making it easier for foreigners to invest in U.S. property.
2. Be in it for the long haul
Be real, there’s no recipe for instant success when it comes to both business and property investment. It takes a long time to lay out your plans, to set them in motion, and to receive the spoils of your effort. There’s nothing instantaneous about either of the two. So buckling in and being patient is all part of it.
Instant gratification is something we all look for now. We want everything quicker, to get results faster, and for things to arrive on demand. Sometimes we settle for short-term success because we want to succeed right away, shrugging off the possibilities for the long-term. But it goes without saying that if you want long-term success, like a good business aims for, you have to have the tenacity to stick with your plan. The rewards of short-term success will probably fizzle out just as quickly as you attained it, which is why you should aim for something more permanent and sustainable.
Stan Lee, for example, was about 38 years old when he contemplated parting with Timely Comics and creating his own set of superheroes to rival that of DC’s. When he did, he created an entire universe that’s become so well-loved that it paved the way for dozens of movies and series and an entire web of crossovers. With patience and perseverance to create something that he loved, he was able to find success.
3. Time and effort sets up success
Putting in the time and work every day to research your property/ies is also important.
Just like putting together a business, you can’t haphazardly slap it together. You have to take the time to review the right people for the job, where they fit, how the business model works, and what you count as a success indicator. Effortless, lazy work yields sloppy results. The same goes for property investment.
If you don’t put in the time and effort in finding good prices, identifying the best investment opportunities, making good renovations, and working with the right people, you can compromise your success on a property. By putting in time and effort into these four areas, you can set yourself up to thrive. If you don’t, you will end up paying too much for a property, having shoddy renovations, and even find yourself stuck with an unreliable team. Like we said earlier: Effortless, lazy work yields sloppy results.
4. Finding (and hiring) the right help
No matter how good your vision is in a business or in property investment, you’re only as good as the team you hire. If you get the wrong people, you’ll fail to attain that vision. Being able to find good people to help you in the capacities you need them to will be vital to what you picture the property to be.
Just like in a business, you should screen people, look at their strengths and weaknesses, and the skills they have, as well as any references they can offer. If they align with what you want, they can certainly help you out.
When investing in property in the U.S, you need property managers, maintenance contractors, and real estate agents.
A property manager will deal with tenants head-on and have the keys to your property. They’ll be the ones to handle the tenant. Having a good property manager ensures that they will have a pleasant relationship with a good tenant, keeping the property safe from damage and both the tenant and property manager happy with how they interact with each other.
A maintenance contractor is in charge of the renovations and repairs and, as their name implies, the overall maintenance of the property. Keeping the property in tip-top shape will keep you from shelling out more money for small fixes that could have been avoided.
A real estate agent handles the “selling” of your property to a future tenant. A good one will ensure that they buy at the right price and will pitch your property well, showing off all the good aspects and playing up strengths.
5. Commit to reinvesting
One clever business practice is reinvesting, the act of purchasing additional shares from what was invested before instead of receiving the profit. It sets up a business for success in the long-term and can help grow profit exponentially.
This goes for property investment in the U.S.
Take Warren Buffet’s investing career as an example. He started out in high school with a friend, buying a used pinball machine and installing it in a barber shop. It did so well that the two, instead of settling with the money they’d earned, reinvested in more machines and installed them in more shops, growing their profit.
Instead of cashing in right away, reinvesting can help grow the distributions you’ll receive in cash by an exponential amount. Rather than investing in one property and stopping there when you get your desired amount, use that to invest in another property since the U.S. property market is booming. You’ll definitely find other property investment opportunities that can bring you more profit.
Investing in property in the U.S. is a great opportunity right now, but going into it blind and without a plan can hurt your investment in the long run. Being strategic in implementing goals, and going about it like a business will bring you the success you need in the market, promising you even more of it the more you do it.
If you’re interested in pursuing property investment overseas and need advice, download our guide, specifically on investing in the U.S – “7 Simple Secrets to Investing in U.S. Property”. Let me know what you think!
Linz’s Musings –A time for Celebration and Reflection
/in Archived, Uncategorized /by Lindsay StewartHappy Easter to everyone! It is insane how quickly this year is moving already, with Easter upon us once again.
I love this time of year, while not a huge fan of chocolate, it does give me a great opportunity to pause, relax and reflect on how the year has started.
Footy is back, autumn weather in Melbourne is lovely, and with banks and most businesses closing for a long weekend here in Oz, it’s a great time to take a breath…
How has your year started?
Is it what you expected?
The pandemic is still showing us it is here to stay and Brisbane-ites may even have to face Easter in a lock-down…
But sometimes, with the speed of life now, we can get so caught up in the day to day, the fast-moving pace of business and life, time just drifts past us before we know.
We do not often think to periodically stop, reassess, and make sure we are still headed in the right direction.
What if the wind has changed on us?
Did any of our decisions not turn out as we expected?
Do we need to adjust course?
These are all things that should be reviewed regularly.
Personally, at the end of each month, we take a half day and celebrate the month gone. Then, first day of the new month, again, spend 3-4 hours reviewing how the previous month went, and planning for the next.
Now while everyone may not have the same opportunity to do this, Easter can be a great time to force us to take a breather and have a quick look on what we have been able to achieve so far, and where we need to adapt to keep momentum going.
It is important in this review, to celebrate your wins, no matter how small. Celebrate the achievements you have been able to make so far, regardless of how many to go.
Then, we can review what changes, tweaks or adjustments can be made to increase the pace or keep progressing.
Progress and action are important, but equally so is rest, celebration, and review.
So, this weekend, kick the feet up, celebrate what you have achieved so far in 2021 and prep for a big 2nd quarter!
Linz’s Musings – Mindset, Growth & Belief
/in Archived, Uncategorized /by Lindsay StewartI did a post recently that got some attention, regarding how RE markets in the U.S. are boom (same as here in AU and in NZ) but yet still, some that keep talking about investing, are just not doing it…
What are they waiting for? Better growth??
In reality, it is fear. And the most important thing to focus on is your mindset to overcome the fear.
I say important, because without mindset, growth and belief, all the strategy in the world is useless to you. Without the belief you can achieve, the mindset to be able to overcome the fear and difficulty (and oh my, there will be difficulties!) you will not be able to achieve success, whether it be in business, investments, wealth, or happiness.
It’s the growth and belief that you develop that allows you to firstly recognise opportunities and strategies that you can use. It’s that growth and belief that will allow you to take the strategies you KNOW you can apply and run with them.
And then again, when things get tough, it is that growth, belief and mindset that allows you to push through the barriers, get up after the setbacks, and keep moving towards your goals.
If you have read any of my blogs or musings before, one of my favourite sayings – It not knowledge that is power, but the application of that knowledge.
Yes, I agree, we all need knowledge. Hell, I’m pretty certain that none of us (myself included) put enough of our time each day aside to learn, read and grow (well, maybe my business coach who reads a minimum of 2 hours every day) but you get the idea. Knowledge is needed, learning is critical, but if you do not have the personal growth to apply that knowledge, if you do not have the mindset to succeed in the adversity, then it becomes moot.
Just another course we bought and placed on the bookshelf; just another book that looks great, but we never open the cover; just another strategy we have been taught that we never implement.
It is growth, mindset and belief that will allow us to take and use the tools we learn and to achieve. And it’s not something that will necessarily occur overnight, growth takes time.
But sometimes, mindset and belief can be like a switch! Something will resonate with you, a key that will trigger that inner lock deep in your psyche that suddenly unlocks, and all becomes clear…
Find yourself that key, however long your journey takes and suddenly the knowledge becomes vast and available…it was always there, you just couldn’t see it…
Linz’s Musings – What are you waiting for?
/in Archived, Uncategorized /by Lindsay StewartOne of the most common themes of questions I get asked, every week, via social media, emails, even during phone calls, is all about growth…
Which areas have the best growth?
What if the market does not grow?
Is the U.S. or AU market better growth?
Its like we are programmed to only look for growth when buying properties…
Now, don’t get me wrong, growth in property is certainly nice. In this country we have the old saying that every 7-10 years the price of property doubles… Whether that will still hold going forward, with the price of properties in Australia and New Zealand so high, I do not know.
Even Auckland right now is seeing property prices rise $100,000 in just 1 month! Crazy.
It seems at the moment we have massive property growth in a number of markets all simultaneously. That’s what cheap money does.
But, with so much focus on growth (which, by the way, is only ONE of hundreds of ways of making profits in property) why is it that there are still so many people TALKING about investing, but not actually investing?
Waiting for years to see if they can predict ‘growth’
in any particular markets, and when it is jumping up and biting them on the nose, they are still waiting for… something?
Every media outlet, publication, social media group/platform is posting charts about how much growth we are seeing in Australia, New Zealand, United States, and predicting how high it will go, how long it will last, and yet many are still not convinced now is the time to invest.
Now, I get that the AU and NZ markets can be prohibitive due to costs (although there are strategies you can use with little or no money down, but these can be tough to implement) but markets such as the U.S. are quite affordable.
I think it was Robert Kiyosaki who said it best, when asked when the best time is to buy real estate. His response was “The best time to buy real estate was 20 years ago, the second-best time is now”. Or maybe that was Warren Buffet?
Anyway, the point is investing in property is a process, not an event. You are not waiting for a bunch of stars to align, or signals to be all green before “taking the plunge”.
It is a process to firstly get yourself into the right mindset for investing; the right financial position to invest; acquire the knowledge you need or talk to the right people to help you if required.
If done correctly, you will generate wealth through real estate in any market… not just growth markets.
Is the U.S. market growing right now? Absolutely! This would currently be the hottest market within the U.S. that I have experienced in my time.
Are we making more now, in this super-heated market? No…
Yes, properties are selling for more, and one of the biggest benefits of such a hot market is that we can get into and out of the deals faster but our returns using manufactured growth strategies are still around the same – 20-30% nett ROI on a deal.
The issue during hot markets is that while we can sell the properties for more, we also have to pay more to acquire them…
Is now a great time to get into property, absolutely!
But so will tomorrow, and yesterday, and last year…
Nike’s point is true – Just Do It.
There is not much certainty in this world of ours, certainly nothing certain about markets, investing in anything. But one thing is certain…
If you do NOT invest, you will make nothing.
You got this!
Happy Investing all and have a great weekend!!