How to be a ‘sustainable millionaire property investor’

POWER THOUGHTS: There are five powerful mindsets that set apart the successful from the mediocre investor

We live in an age where information is readily available literally at our fingertips. Because of this, we face a new problem - information overload. There is an avalanche of information that young or new investors have access to. It is those who are able to conceptualise and take action on the information who will achieve great wealth. The mindsets or guiding principles are what set apart the successful from the mediocre. The following are some of the powerful mindsets to help you become a ‘sustainable millionaire property investor’!

1. The market is huge, but the world is small
This first mindset is extremely important to set out your attitude and character as an investor. The first part states that there will always be great opportunities in the property investment market. It is often heard that purchasers complain that property prices are too expensive. Property agents complain that there are too many agents in the industry.

Developers worry about competition and how their products will sell in the market, while in general, the public think that there is an oversupply. The truth is, the market is truly large enough for anyone to find great property investment opportunities. The challenge now is to sieve through the clutter and select the best.

The second part of this mindset states how critical it is to always do the right thing. Every investor must understand that the Malaysian property investment ‘world’ is small. It is important to build what I call the ‘super-network’, which consists of agents, lawyers, bankers and other stakeholders in the property investment value chain. It pays when you are a kind person and always ready to serve others, rather than having a mindset that likes to take advantage of people.

Think collaboration rather than competition. Make a decision today to become the best person that you can possibly be, upholding the best values and ethics in all actions that you do.

2. The REIT and banker’s mindset
This could possibly be one of the most powerful mindsets to have as a sustainable property investor. When you are making a purchasing decision, try to remove yourself from the ‘moment’. ‘You can’t read the label if you are in the bottle!’ Imagine that you are running your own REIT Management Company. Imagine you have to select the best property for your Real Estate Investment Trust and would be answerable to the performance of these assets to all the institutional and individual shareholders. What would your checklist look like and how would you conduct your due diligence? You would certainly be very careful and critical in selecting these assets.

Secondly, imagine you are the owner of a bank with millions of ringgit of funds to lend out to property investors like yourself. You are responsible to answer to the shareholders on performance of the loans and are the person to report Non Performing Loans (NPLs). This mindset, instead of complaining that banks are unfair or too tight on their lending policies, allows you to focus your energy and brainpower on how to assist banks to give the much needed funds to buy that great asset that you have selected.

3. ‘Fast fish’ eat the ‘slow fish’
Yes, it’s not the big fish that eats the small fish anymore. It’s the fish with the turbo engine that eats the slow or big fish. When information is so readily available, it creates an almost ‘level’ playing field. When everyone is ‘smart’, you have to be ‘smarter’. When everyone is ‘fast’, you have to be ‘faster’.

Half a step is all it takes to get you that golden property investment opportunity. Having said this, young and new investors need to understand that being fast can also be equated to being hasty and careless.

In property investment, making a hasty mistake could take a lifetime to recover from. Being the fast fish in property investment arena would mean being fast with your numbers and investment decisions.

With so many sub-sale and property launch opportunities, you need to be fast to decide which are good and which are great. Don’t be paralysed with over-analysing. Our lives are already busy enough as it is, as we would need to think on other daily matters.

Being fast also doesn’t mean that you skip the process of due diligence and making your property inspections. This must still be done. Then, run your numbers based on your investing parameters, make a shortlist, recheck the numbers and pull the trigger, and move on.

4. When you say you know everything, is when you start to lose money
I’ve met so many successful property investors and the one single trait that they are not, is that they never claim they know everything. No one is larger than the market, and no one can say they are an expert. Most property gurus I know are the most humble people. They may know and may have experienced much more than the average investor, but they always seek opinion and are always open for ideas from other investors. This is how they continue to find constant windows to new golden property investment opportunities. The moment you say you know everything is the day you will stop finding these windows.

5. The ‘property investment business’ mindset
Many people stay away from becoming property investors due to some of the inherent or rather the ‘popular’ problems and risks. The most popular one is the tenant management problem. Some people stay away from it because they are afraid of the risk of being in debt for the purchase of a particular property.

If you see it from the point of view of a person doing a ‘property investment’ business, you will understand that there is no business on earth that doesn’t come with risks. Certain problems simply come with the territory. Once you accept this, you will become an investor that will now focus on how to manage these risks and focus on the positive possibilities.

 

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