No Hiding

API22

It’s been another week of trying to catch up with administration; it just never goes away or gets any less. The constant barrage of emails is even more daunting, I subconsciously must see them as more important as I have to get them out of the way before the paperwork can begin. The tax return is still hovering over me and all I really want to do is play. Such is life for anyone in business; there simply is no hiding place from the mass of things that has to be done. It’s generally considered that as more people work with you and for you that all these things should get easier. The reality is however very different from the image and we really should be aware of this at the outset because perhaps it might change our mind as to how to move forward at all. Sometimes less can be more if it gives you the time to enjoy doing what you do most enjoy.

Few landlords will actually tell you that it really can be very hard work. It’s not being the landlord that’s difficult but handling all the minor things that are constantly needed and then dealing with the major issues as they crop up without cracking up in the process. When you want to make serious money from property you have to have at least ten, and if you’re an HMO (House of Multiple Occupation) landlord that could easily be fifty tenants that are always in need of attention. Maintaining your own house can often be a big enough task, when you have ten or more to look after it just gets worse. Most people go for giving around ten per cent of their rent, to have the places managed. This doesn’t cover getting any work done, just collecting the rent and paying it over. Those of us who self-manage our own portfolios know that ten per cent of income can make a big difference to the bottom line.

Sometimes we have to change our expectations of what we are going to achieve to avoid being disappointed by the end result. Property is no quick fix, it’s a slow process to make a return and build wealth, yet so many people seem to think that it’s going to make them a fortune very quickly. Admittedly in this current market there are some real bargains to be snapped up but moving that property on again can be troublesome. We have to learn from every situation and I’m still learning after over thirty years’ experience. I recently sold a property for less than I wanted, it’s gone nearly to fruition only to be told the buyer want’s a further reduction because the surveyor down valued it and to pay for some minor repairs. I now have to work out whether it’s worth it to us to sell it or hold it again. I’ve continued to advertise the property whilst the sale has proceeded and I now have an alternative purchaser.

Keeping our options open is vital when we want to make the most from a sale. The new purchaser is essentially willing to pay more because we’re offering to sell it to him as a rent to buy deal rather than a straight sale. We won’t get a lump sum as we were initially hoping for but we will get more money in the long run particularly as we won’t have to pay redemption charges to clear the mortgage. We often need to take an overall view to make a decision on what is best. That also depends upon what we intend to do with the funds though. The reason for selling this particular property was to invest into another far more lucrative deal nearby.What has transpired in the meantime is that the other property we are intending to buy can potentially be structured in another way so we might not need the lump sum after all.

Property can be a passion for many people and to make a go of anything you need a level of dedication. For me the best part has been seeing run down properties renovated back to a former glory or in many cases brought up to a modern standard and use never previously attained. We recently found a potential joint venture partner who appears to enjoy the same values and ways of working and we have great hopes for the future to make a long term partnership for a particular type of property.

Whenever something happens that appears to be negative we need to learn from the situation or change our goal to progress towards a different outcome which can possibly be even better. We can often judge too soon and be disappointed about things that are really just temporary challenges. Having patience is a virtue, sometimes we have to re-evaluate what we want to achieve and develop a different plan to get us there. There is no value in hiding from a situation, the learning is in creating an attitude of positive expectancy about what will happen next time regardless of what has occurred before.

Always be willing to see the facts as they are not as you hoped they’d be.

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