Leverage Other People's Time
Nick Gentle explains it’s important to leverage not only other people’s money, but their time too.
31 May 2018
Property investment is a game of leverage. Most investors are familiar with the idea of “other people’s money” or “OPM”, where one leverages the bank’s money to buy a property. The rental income that covers your mortgage and costs is another example of OPM.
There is another form of leverage that is just as important in the modern world, “other people’s time” or “OPT”.
Having a team around you is a form of leverage. Your property manager finds, vets and looks after your tenants – they also contact a builder for repair work; the builder visits and looks after the property; your mortgage broker places loan applications with different banks and negotiates the best deal for you; your insurance adviser shops around, makes sure you have the right policy for your property and are not paying too much or are under-insured.
Your accountant is a great example of leverage: one hour with a property specialist might cost you a fee, but in return you get the most tax efficient and flexible structure for you.
Your property finder sources properties that you would not have otherwise noticed, analyses them and has their team do the same, so that you can make a smart decision.
Here at iFindProperty we help you tie all this together. As well as finding investment properties, we introduce clients to our team of experts so they don’t even need their own network to enjoy the power of OPT.
‘I leaned on an architect, a builder, a property manager, a valuer, a mortgage broker and an insurance broker, I leveraged their time and expertise to make the deal work’
A few years ago I bought an inner-city property that I knew I wanted to remodel to increase cash-flow, however I was getting conflicting advice on the best approach and was stuck. Also, I had been busy with life for a couple of years and was not really moving forward as an investor.
I signed up to work with a successful investor and coach who helped me work out the pros and cons of different approaches. In turn he introduced me to an excellent architect and a good builder. I leveraged off their combined knowledge (and patience in answering all of my questions) and also my property manager in deciding on a plan.
The project increased the property rent and value significantly. I thought that was a great outcome, so I bought a similar project nine months later and renovated again. Then I bought a third, which is ongoing. This has been life-changing financially and is a great example of OPT.
Back to leverage. The most recent two deals I bought, planned and worked through largely on my own and largely while I was not there. How? Well I help run iFindProperty and pulling together a team to make something happen is our bread and butter.
I leaned on an architect, a builder, a property manager, a valuer, a mortgage broker and an insurance broker. I leveraged their time and expertise to make the deal work and the bank’s money to fund it. If I had stuck with what I could do myself, none of this would have happened. I’d still be there with my first property trying to figure out what to do with it.
You don’t need to be at the renovation/remodel extreme end of property investment to reap the benefits of leveraging a great team. It doesn’t matter if your style of investing is “set and forget”, new-build, “roll up your sleeves” or something else. The benefits of getting the right advice at the right time and acting on it will compound exponentially over time just as much as the leverage you already enjoy from the bank.
iFindProperty is a licensed Investment Property Agency and our clients tell us we are great at helping investors find, analyze and buy great properties to build an awesome portfolio. Our team of Property Finders operate all over New Zealand and each are successful investors in their own markets. Successful investing starts with you and your property goals, so contact us today to talk about what you want to achieve and we will put a team in place to make it happen. Contact:[email protected] or 0274 866 146.