What's the biggest challenge for you with property investing?

Interested to hear what you've found to be your biggest challenge or learning curve so far.

Doesn't matter if you're new to PropertyChat or an experienced investor, please share your thoughts.

It could be anything from "Where do I buy?" to "I'm stuck on approvals for a high rise".

 

The biggest challenge is myself, I want more now.

I need to learn better patience, which I am trying to improve.

What is yours @Jake Milne?

 

Hmmm, the biggest one doesn't exist. Everything is challenging when you start.

Where do I start?
Where do I buy? (and how/ where/ when to start?)
What am I missing?
How can I be confident that this is the right suburb/ property/ finance etc?
What's the process? What's the process for the particular state?

Etc

 

I like high growth properties - no more than 10km from city, being able to create the cash flow to service the loans has been the challenge to growth so far.

I like to create cash flow through building businesses.

 

Nice thread

Biggest challenge has always been sourcing finance.

The only time this was not a challenge was when we had lo doc/no doc loan products. They are still around but you still need to meet certain requirements.

MTR

 

Obtaining finance. Plain and simple.

 

@Big Will I hear you on that one.

Mine biggest challenge is setting my lifestyle to live below my means. The more I earn the more I tend to go out and try new experiences which costs money.

Balancing lifestyle now vs. investment for the future has never been my strong point. I do understand though that investing is similar to the gym, painful now, results later. It's something that, for me, needs constant self discipline.

 

Learning to love debt or fear of the unknown.

It is hard to get your head around owing 20+ years of net salary - even if it does
have its own income stream and assets covering it (even at a low LVR).

 

I no longer have the motivation or desire to buy long-term hold IP's that don't have a pos cashflow...been there, done that and was never happy at any stage; even though the wealth was going up - too many headaches and crap tenants and so forth for the pathetic cashflow returns.

No interest in short-term flips as I don't have the time to put into the renos required, and cashflow drain while the project is held until completion and sale..

I only want to do anything real estate these days involving creating more serious PAYE replacing cashflow - smaller subdiv development or straight buy, bulldoze, rebuild and sell; but cannot play at that level due to the last 5 years disaster.

Stuck, looking on from the sidelines atm.

 

Just generally keeping on top of property management, various bills and accounting stuff here.
It would be nice if property investing were completely passive, but it really is like running a passive business and you have to always keep an eye on things.
Probably spend an hour a month looking after the portfolio but would rather not.

 

Deposits, cash flow and finance are the only real tangibles that hold back property investment.

Everything else is just mindset and research which although they present challenges they are subjective and technically can be overcome very quickly.

 

getting the other half on the same page

 

Basically it not passive.

Seems we are always doing something either paperwork dealing with tenant demands / requests maintenance issues. It just never stops. We can elect to ignore it for a while but found you are best to deal with an issue immediately as tomorrow there are more

I admit it's all about your personal approach and our approach is hands on (in the main)

I feel that those who aren't hands on or at least involved will be find that over time their properties will deteriorate simply because the tradies that are sent out by the PM don't care they may do their job (and then maybe not) and then onto the next job - send the bill. Pm's never go out to check so you are getting a lesser quality property over time.

Now you can argue that the property inspection will sort things out but I don't buy that. How can they when it's not two different PMs doing the inspection. With most PM having no building type experience to boot.

Cheers.

 

Finding the right projects for PI as not interested in buy and hold; and finding the balance between lifestyle (private school for kids, holidays) and investment. Also the balance between asset classes (business/shares/property).

I have some serious planning to do over the Chrissy holidays.

 

The biggest challenge is controlling one's thinking/mindset.

Its the starting that stops most people due to fear.

Psychologically it's the fear of losing.

Fear is overcome by gaining knowledge & having the courage to apply that knowledge over a period of time. The result is experience.

The poor and middle class play the game not to lose, whilst the rich and wealthy play the game to win.

Notice the difference? One's focusing on winning and ones focusing on losing.

You get what you focus on the majority of the time.

Success is 80% mindset and 20% strategy.

If you play the wait and see game there will never be the perfect time to invest because your mind will always be focusing on why you cant invest instead of why you need to invest.

The 2nd biggest challenge, as already pointed out, is not structuring one's property acquisitions for CG whilst at the same time managing cash flow and then structuring one's finances accordingly for doing so.

Being able to build a substantial size property portfolio is NOT about 'property - its about Finance!

Finance and structuring it in such a way so as to be in a position to continually access it to keep purchasing and building your portfolio further.

You must meet the banks/lender LVR & DSR lending modules and continually place yourself in a position to do so 'before' hitting their module walls because if you leave it until after it's too late - catch 22.

 

Hardest part is picking up the rents every 2 weeks and someones behind in the rent for 6 weeks due to contractors higher up the supply chain not paying him then he can't pay me
and you knock on the door it opens and their standing there with a winnie blue in the mouth and a 500ml of iced rum and coke,and say can you come back in a week,they always pay
but that the hardest part getting money on rent days sometimes..

 

Absolutely agree! People always look at me oddly when I say that I 'don't deal with property to make money - I deal with finance'. Property just helps me make the money.

Unfortunately, I didn't budget well for the increasing serviceability requirement. I guess this just creates the opportunity to be more creative in financing...

 

This.

I think alot of investors miss this golden point and then wonder why they hit the walls so quickly.

 

Trying to balance the Portfolio between shares and property

 

Building up deposits.. Still in the "early days" so don't have significant asset growth to borrow against = budgeting & waiting.