Winners and Wanna-Be’s: 7 Key Lessons for tough times in the Property Market.
By Geoff Doidge of The Reno Kings
The Reno Kings have identified 7 key areas where most people get into trouble. But before we tell you the 7 key lessons for tough times in the property market in detail, we want to let you know that The Reno Kings will reveal 25 of the Best and Worst Property Deals plus tell you how to receive your free property reports next month at the Melbourne Property Expo. For more details click here.
What is the difference between Winners and Wanna-Be’s?
Winners know how to be winners. They also know what it is to lose and they don't like it. They know what they have to do to get to the top and they know not to lose sight of their goals. As for the Wanna-Be’s, and we don’t mean that in a derogatory way, they want to be winners but sadly they don’t know how to achieve their potential. In the Olympics you see this happen all the time… two people with the same ability, same intelligence, outwardly similar in many ways but one wins and other loses. Sometimes, it doesn’t seem fair but usually there is always a difference and often it is a mental thing not a physical thing. Some athletes don’t win until their 3rd Olympics as it can take them that long to change their mindset and improve on the key things that make a difference.
In Property we have noticed the same thing. Both Paul and I have been through those tough times, we have made mistakes, learnt our lessons and have emerged on the other side financially stronger and wiser. We have taken time to reflect on those lessons and I want to share them with you so that you too can learn to be a winner.
7 Key Differences:
Here are the secret seven seemingly small things that can make a massive difference:
Key #1: Understand Money
Key #2: Have Emotional Intelligence
Key #3: Know how to Add Value
Key #4: No Analysis Paralysis
Key #5: Control Interest Rates
Key #6: Think Long Term
Key #7: Learn From Mistakes
Key #1: Understand Money
Winners know how to control debt and make the money they borrow work in their favour. Winners know the difference between good debt, bad debt and super bad debt. They understand the concept that if the property is bought well the equity created can be used to buy more property. They also understand how to use their tax refund from capital allowance and depreciation to increase their cash flow.
Wanna-Be’s let debt or the fear of debt control them and therefore never move forward. Wanna-Be’s struggle with the concept that certain debt is good and can turbo charge their portfolio whereas other debt can wipe them out. Mix them up at your peril.
Winners even know how to use credit cards to their advantage and not to the banks profits. They realise that by paying their bills and expenses on time from their credit cards they can keep an accurate record of their payments and earn points at the same time.
Wanna-Be’s use credit cards to get them through to the next pay packet.
Key #2: Have Emotional Intelligence
Winners know how to control their emotions and that perfectionism can keep you poor. They are clear on what it means to ‘get it done, get out and get it rented!’. This is all about doing the minimum to get the maximum return.
Wanna-Be’s purchase investment properties and make the biggest mistake of getting too attached and fussy about it. They tend to pay too much because they feel it has to be up to a standard that they could live in. They tend to overcapitalize as they renovate to the ‘home’ standard that they must have not to a standard that the average tenant would be happy with. They don’t understand that emotions can cause the project to take maybe twice as long and possibly double the budget.
Key #3: Know how to Add Value
Winners know how to look at an average suburban house and use the Reno Kings strategies to add extreme value in a few weeks. Winners see the dollars by looking past the muck and focusing on the money. They have multiple ways to make money such as renovating, strata titling, subdivision, development, shifters and splitters, boarding houses, removal homes, building to rent, niche markets.
(P.S. The Reno Kings now have over ‘99 ways to add value’ to an Investment Property.)
Wanna-Be’s see the dirt and miss out on the best opportunities (dollars).
Ask for your free report at the Melbourne Property Expo. Click here for more information.
Key #4: No Analysis Paralysis
Winners think first, are decisive and take action. They usually have a plan and work to that plan never losing sight of their goal and never allowing challenges to overwhelm them. This is important in the current market where ample opportunities exist for investors who are not afraid to look.
Wanna-Be’s think about it forever and do nothing or they act without thinking. They need to realise that they need to change their perceptions to be a winner.
Key #5: Control Interest Rates
Winners know when to restructure their loans to give them enough breathing space with their repayments. They also act on getting rid of any low interest accounts and swapping them over to higher interest accounts.
Wanna-Be’s are not active when it comes to structuring their bank accounts to work in their favour. Some wanna-be's concentrate on P&I (Principal and Interest) loans for investment properties and don't realise the advantage of Interest only loans.
Ask for your free report at the Melbourne Property Expo. Click here for more information.
Key #6: Think Long Term
Winners take advantage of market conditions. They buy low when others are scared and sell high or hold for long term gain. They are guided by what they see out on the streets and not by ‘old news’ that is published in the ‘newspaper’.
Wanna-Be’s buy high and then sell low. They are normally in panic mode and suffer short term pain. They go with the crowd spurred on by whatever the headlines are in the ‘oldspaper’.
Get your free Research links at the Melbourne Property Expo.
Key #7: Learn from Mistakes
Winners are always learning and learn from others mistakes. They know to take advantage of others experiences to move ahead.
Wanna-Be’s feel they know it all and keep making the same mistakes again and again.
