Passive income or Hands off investing
Passive income or Hands-off investing
How often do you hear those phrases?
Nearly all the promotions and marketing for property investment clubs, groups, or training use them along with other enticing phrases like:
Minimal drain of your time.
Zero to £5,000 a month income with ease.
Simple ways to invest in XXXX (Town Name).
In my experience of over 25 years of investing in property, this is rarely the case.
If indeed not even true at all.
I have never bought or owned an entirely hands-off property.
Yes, you could outsource:
- Finding the property.
- Negotiating the price.
- Refurbishing it.
- Letting it to tenants
- Managing the tenants.
All you have to do is provide the money and sign some paperwork!
What happens, though, if there is a problem?
The reality is that the longer you own property, the more likely you are to have a problem or challenge. Also, there will be challenges if you buy a property at a great discount—that’s why you got it at a great price.
Challenges could be:
- There is a problematic tenant in the property.
- There is no proof of ownership for the seller.
- The council has issued an improvement order to the owner.
- Maybe the seller has other debts secured against the property.
- Will you need to re-mortgage at some point?
- The tenants have not paid the rent on time.
- A disgruntled tenant has reported you to the environmental health office.
- The house not being looked after properly?
These are all challenges I have experienced over the years.
With any business, you do have to get involved or hands-on at some point and the amount of involvement depends on how good your Power Team is.
A Power Team consists of people such as:
- Sales Agents
- Letting Agents
- Deal finders
- Builders, Plumbers, Electricians etc
- Solicitors
- Brokers and Accountants
Get this right, and it all becomes easier for you to spend less time on the business.
Remember, minimal time spent on your property investments with great returns is only really possible with a fantastic power team. You will still have some occasions where you must get involved. That’s business!
This may sound not very optimistic about property investing, but I think it’s realistic and honest.
I love investing in property and have seen the fabulous benefits first-hand, so I continue to buy deals myself and with business partners. I do my own due diligence and have a robust Power Team to make things smoother.
You can do this, too!!