Time to Reflect

Time to Reflect
22-Dec-2017 Mark Honeybone

Time to Reflect

Something we should all regularly do is to have a quiet time to reflect, set goals and track how they are doing. However, many of us are (or think they are) too busy to do this or just don't get around to it. This is where I love the Christmas break, in fact early in the new year when you are either at the beach or just finally having some quiet time on your own to sit back and look at new goals making a plan on how to achieve them for the upcoming year. I love this time and usually come up with some crazy ideas, but also just check in that I am on track with my big and small goals in life.


Are things on track with what you are trying to achieve with your property(s)? So here are some property strategies ideas and goals you may want to look at in 2018:




Pay Down Debt 

Focus on paying down your debt. This creates less risk and greater equity, also the less debt you have, the greater your cashflow will be in your overall portfolio.

Create Equity 

This may be by renovating, creating more rooms in a house, subdividing or many other methods.

Create Cashflow

If you are self-employed or your income isn’t that great, it becomes even more important to think about creating cashflow to help with servicing debt. In today’s market with higher pricing, you can’t just go out and buy an 8 or 9 percent gross yielding property, but there are ways of creating it.

There are room by rooms deals (we have a few we know of for sale), where you could do this or maybe buy a backpackers or boarding house. These are all options, but they come with slightly higher risks. The other way is to create your own cashflow by adding bedrooms, sleep-out, minor dwelling, renovating a property. There are endless ways of creating this.

New Builds Investments

I know many investors who only buy new builds and take the advantages those provide: chattel depreciation, less maintenance and if brought well may get some capital growth during planning and construction stages.

Commercial Investments

Having a good long-term lease usually comes with less tenant issues. Because commercial valuations are done on the lease that you have in place, you can create equity in a commercial building by buying something that has a bad lease like a short period left to run, unfavourable terms or others. Then by re-doing the lease for a longer term and where the tenants are paying most of the outgoings, you can increase the yield

Prepare for Opportunities

If you’re a new investor, then start putting money aside for future opportunities. If you’re an experienced investor get your property(s) re-financed with new valuations, so you are in a good cash position to take advantage of any opportunities that come up in the market over the next couple years. Have your pre-approvals in place. The more you are organised, the better deal you will buy when the opportunity is presented to you.


The above are just a few ideas to help your portfolio or goals in 2018. Ideally, you should know your plan of action by the end of January 2018, so you are clear on what to do during the year. Setting clear goals gives you a higher chance of achieving them.

 

Some of the above ideas are more complex than others and require deeper understanding, so I suggest surrounding yourself with the right people. Ask, network, do what you can, join investor groups, go to mentoring, talk to successful people. 

From me and the PVRE team, I hope you have all had a great Christmas, and here’s to a fantastic 2018!

Opportunities are everywhere; you just need to recognise them, create a plan of action and act to achieve your goals.

A small plug, Property Ventures Real Estate has an excellent opportunity right now for cashflow. If you have some land around Christchurch, or maybe anywhere in the South Island, please contact me on the below email for more details.