So, you’ve got the money ready to start your property investment journey, but do you know that having the proper attitude and mindset right off the bat can help pave the way for a successful trip? Here are some points to ponder to get you prepared when you embark on a (possibly) life-changing venture!
Confidence is key when you’re venturing into property investment. Have you seen any successful investors who aren’t confident? Exactly my point. Besides, if you have enough confidence, you will also be able to…
Believe in yourself
Conviction is a very strong feeling, so you will definitely have to place your belief in yourself before putting your faith and trust in other people. Believing you can achieve something is already half of the journey, so with the positive energy from believing and being confident in yourself, you’ve already set a platform for you to face the possible challenges on the way to success.
Do your research
Of course, you can’t just run around on blind faith without doing some thorough research into what kind of property and investment you plan to take on. Believing that a property will bring you 6% or more of rental yield because you believe the area is popular, is very much different from actually obtaining accurate facts and figures to support your belief. As the Chinese saying goes, the shores of learning are neverending (学海无涯), so live and learn and improve yourself through gaining knowledge.
Get rid of ‘herd mentality’
It’s inevitable, but not unavoidable. People tend to follow the majority opinion, even more so when it comes to buying property, so the ‘herd mentality’ occurs when a large group is convinced that a particular area or development is good, thus drawing more people to agree and join in. Get rid of the ‘herd mentality’ of agreeing with what others say, and draw your own conclusions based on your own research and understanding of the market. Decide for yourself; don’t let others decide for you.
Always be ready for good buys
You will always hear people saying, this is not a good time to buy or wait a while longer and see how it goes, but the fact is that good buys can come up at any time, regardless of the market situation. Therefore, you should always be ready for good buys, even if it’s at a time when most people prefer to sell. Going against the grain may also prove lucrative in the long run if you are savvy or fortunate enough to score a good deal.
Que sera sera
Remember the song that goes like this? “Que sera sera, whatever will be will be…”
That is exactly why you should maintain a healthy balance of optimism and pessimism when investing in property. If you miss a good opportunity, try not to sigh so much over the loss, as property investment can rely on luck as much as personal effort. Who knows, you might have missed out on a chance now, only to be presented with an even better opportunity in the future.
Don’t be greedy
Many people are lured into the real estate industry or property investment thanks to the promise of quick and rich profits. It’s important to realise that success isn’t achieved overnight (just like how Rome wasn’t built in a day) and that many successful investors had to go through long periods of failure and frustration before seeing the light at the end of the tunnel, and that they only represent a fraction of those who ventured into the business. Don’t be greedy by attempting to buy properties beyond your means, or trying to purchase more properties than you are ready to handle.
Rebuild or renovate to enhance value
Renovations are generally agreed to enhance a property’s value, be it for re-sale or rental, but excessive or unnecessary rebuilding may have a negative effect instead. For example, simple renovations to add a small room or toiler may help to increase your rental yield, but rebuilding a perfectly good home into a one-bedroom studio may not be the best idea if you’re planning to collect rental income.
To find out how renovations can be used to reduce your taxable amount when selling property, read our RPGT Made Simple guide.
Don’t get emotional
The bottom line of property investment is not to get emotional. Property investment involves hard fact, clear figures and logic, therefore putting your personal emotions into the equation may affect your judgment. Don’t be easily swayed by sentimental value or illogical reasons when it comes to buying and selling property, as what one person treasures may not be what another person values.
*This is a series of short articles from our Maspex 2015 Penang experience. Although the exhibition focuses on secondary property and its corresponding market, most (if not all) of the information here is applicable to the Malaysian property market within the proper context. We hope you find these articles helpful and interesting, regardless of whether you are a real estate agent, property investor, or just a member of the public trying to learn more about property and real estate in Malaysia.