How to Build a Property Portfolio

There was once a time not so long ago when even the inexperienced could build a substantial property portfolio quite easily. Few of those people still own it as they never knew how to build a property portfolio for prosperity and longevity. In the bygone days of 110% mortgages and cash back deals; many novice investors took on more debt than they were able to cope with and whilst they had lots of property in their names they were all attached to lots of debt via mortgages that required lots of work to make them pay. Now things are very different and the people who remain in the game are generally those who know how to build a property portfolio without over gearing and jeopardizing everything. Today’s market is very different and lenders are far more reserved which is a good thing unless you want to get started.

How to build a property portfolio now is very different to even five years ago let alone ten or twenty years back, but that doesn’t mean it’s impossible, just different. Right now it’s much easier to borrow if you have income from employment. Trying to get a mortgage without being able to substantiate an alternative income other than the rental income is becoming difficult as for some reason; the powers that be simply don’t recognise the value of the private landlord. Like everything else it’s just another hurdle to get over and if you are unable to do it for yourself you will find few people willing to do it for you. Time is money and everyone has to value their own time but that doesn’t mean that we shouldn’t help and guide each other to make life easier all round.A lot of what we need to do is all about goal setting. Once we have the right intention for our aims we can do whatever we need to.

More over nowadays many people are thinking that using lease option deals are the best way to build a property portfolio. These could be storing up problems for the future and need good legal work to make sure they are sound rather than waste everybody’s time. The basis of an option is that it gives you the opportunity to buy a property at a fixed price at some point in the future or hand it back if the market turns against you. All expenses are normally met by the person taking up the option deal but they then control the property in order to rent it out for more than the mortgage payments and make cash flow. This isn’t necessarily the same as owing property where you actually have a tangible asset you can sell at some point but, cash flow is the major factor where day to day living is concerned.

We recommend traditional purchase methods and if need be by using a joint ownership scheme to buy property. When you want to know how to build a property portfolio we wouldn’t suggest you listen to people who usually take on option deals. Much depends on your reason for wanting property such as short or long term gains. Rent to rent deals are a good way to make money if it’s immediate cash flow you are looking for. When you want to build a legacy for your children perhaps or have a long term business strategy then working with other people would make far more sense. Having someone to help you with decision making, looking after things when you are not around and supporting each other when the going gets rough can be a big help in this climate.

There is a primary obstacle that stops many of us from taking the action we need to move forward with our lives and goals and that is termed learned helplessness. This is the “Why even try?” syndrome. We are all able to do what anybody else has done and if we take the right steps on a regular basis we should be able to create what we want. We need to work to a system that has been tested and shown to work and this is the domain of a coach or mentor. We don’t advocate paying for these people we suggest you work alongside them for common good and mutual reward. Work with a master and make evaluations that are instinctively better will be far easier than going it alone.
Always try to work with an experienced person or team.

Written by:
Lionel Palatine – He is a regular networker and a speaker at events as well as being a property author and adviser. He joint ventures deals and shows people how to buy property for low cost which are inclusive of all fees and deposits.

You can find him on regular social media Twitter |  Facebook  |    |  YouTube  don’t forget to add him

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