As a property investor with a busy life, not only are you limited by the number of hours in the day… and you’re also limited by your own expertise.
We’re not all blessed with the same skill sets, so we occasionally have to turn to others for help and in property investing you need to be able know your own strengths and limitations.
This is a lesson that even billionaire property investor Donald Trump has learnt, saying:
“You can’t know it all. No matter how smart you are, no matter how comprehensive your education, no matter how wide ranging your experience, there is no way to acquire all the wisdom you need to make your business thrive.”
The key thing I want to share with you today is the concept of leverage.
Definition: Leverage – to use (something) to maximum advantage.
Leverage is the key to wealth creation and every thing you do in property investing is about leverage.
Let’s have a look in more depth at the most common forms of leverage that we’ll use in property investing:
Other People’s Time (OPT)
As an investor you will need to leverage other people’s time by forming a team around you to give you expert advice in different areas.
In your team, you’ll need to have the following:
- Accountant – for tax and structuring advice so that you can maximise your returns and protect your assets.
- Mortgage broker – for lending and credit criteria and to represent you to lenders when you apply for a mortgage.
- Solicitor or Conveyancer – to review contracts and legal requirements as well as to transact the buying and selling of the property on your behalf.
- Real Estate Agent – to manage the purchase and sale of your property by liaising with prospective buyers and property vendors.
- Property Manager – to manage the rental agreements and leasing of your property to tenants on your behalf.
It’s important to leverage the time of experts – can you imagine doing all of this work yourself? You’d have to educate yourself in so many areas, and then do all the work – you’d barely have time to scratch yourself!
Other people’s money (OPM)
If you were to save up to buy a property in cash, how long do you think it would take to save up $300k, $400k, or even more?
We don’t do that right? What you do is save a deposit and then use that to take out a loan for the balance of the funds, and then pay it back over time.
This is essentially the concept of OPM. If you could borrow money to create an investment portfolio and come out ahead, then using OPM will speed up the journey.
Of course, using OPM is also the concept behind consumer credit and credit cards – this is a bad use of OPM unless it leaves you better off financially.
Other people’s ideas (OPI)
When someone has a good idea to achieve a result, they would test the idea to prove that it works repeatedly.
The process is then broken down into the steps, methods and the formulae that can be replicated and when followed will produce the same outcome repeatedly.
Essentially, the idea is turned into a system, and we see systems everywhere in society – in education, healthcare, accounting and finance, business, technology, and even leisure and entertainment.
The idea of the system is to make your life easier – a clever acronym for the word “system” is: Save Your Self Time Energy and Money – essentially you are leveraging someone else’s proven idea to speed up your own progress.
In property investing I offer my 10 Properties in 10 Years™ system. The system gives you a personalised step-by-step strategy so you can build a portfolio of 10 investment properties over a 10-year period and enter retirement financially independent.
Other people’s experience (OPE)
Having a system, having the money and having the team is a great start but what you may not have is the experience.
This is one of the most important things, because although you may follow the system to the letter, what you may not have is the experience to use the system in the most effective way.
This is where it always helps to rely upon the experience of those who have already undertaken your journey successfully.
By drawing upon OPE you be reducing the number of mistakes you make, and also progressing towards your goals in a more effective and efficient way.
The best way to tap into OPE is via education, mentoring, books, seminars, CDs, industry events, peer groups and the such
Why would you waste your time trying to learn by trial and error what someone else has already experienced and can share their experiences with you?
First and foremost, tell yourself it’s ok that you don’t know everything, and that you’re not required to know everything!
Once you’ve accepted that you are not all knowing and never will be – and that you’re ok with that, it’s time to start making a list of what you need to leverage.
OPT – Start to build your team of experts who could save you a lot of time with their expertise. Who do you need and what expertise can they offer you?
OPM – What is the best way to create the finances you require? Start thinking outside of the box, but be sure to stay inside of the law!
OPI – What systems and ideas can you leverage to make your life easier when it comes to creating a property portfolio?
OPE – You’ve already started leveraging my expertise by being a part of the Guided Property System, I’d encourage you to explore the next step by reviewing my 10 Properties in 10 Years™ system. Click Here to Read more success stories by people who have used my 10 Properties in 10 Years® system and achieved financial success.
So get started on this, and I’ll have some more to share with you shortly.
To Your Success,
P.S Coming up is the amazing story of how a lovely couple created over $200,000 of equity in their first 12 months as property investors!