You’re not getting the returns you want on your investment. You might think you are, but you’re not. As confronting as that may seem, deep down, everyone wants to do better. If someone approached you and said, “I can improve the performance of your property portfolio by at least 2% for free,” you would probably pay some attention to them. Realistically, we all got in the game to achieve something. To really know what a high performing portfolio looks like, it’s important to look at examples of those achieving at a very high level. If I told you that some of Tommy’s Property Management clients’ portfolios return at 18% nett, for example, it would be easy to say that that’s a very high performing portfolio. We don’t always start at 18% though, so how can you get the best return from your portfolio? How do we get from point A to a high performing B? What does high performance look like to you?
What’s the goal?
If you shoot in the dark, there’s a chance you’ll hit something by accident. There’s also a pretty big chance that you won’t hit anything at all. If you don’t know which direction you’re supposed to be swimming in, then it wouldn’t be unreasonable to just tread the water. If you don’t have a goal or purpose to work towards, your portfolio will be ok. It won’t fall apart overnight and you’ll keep ticking along at 3 or 4% quite happily, until you have to do maintenance on the property and all of a sudden, you’d have been better off with a term deposit and your money nice and safe in the bank where it wasn’t causing you headaches. Set yourself a target of what you’re looking to achieve – and here’s the twist, it doesn’t have to return percentage related. There are some investors who don’t need to return at 18% to consider it as a successful project. For some investors, it’s the time they spend managing the property; for others, it’s a balance. You might be quite happy returning at 7.5% and never hearing about your investment property. No matter what it is, there’s no right or wrong answer. When it comes to being a landlord, but if you don’t know what you’re working towards, you’re almost guaranteed to miss everything. The first step in any successful plan is determining what success looks like to you. Be clear on your mission, and then carve out the path from there.
Get a personalised plan!
At some point in time, we’ve all reconsidered our goals with our health. You might want to lose some weight, or just eat healthier to feel better. Regardless, you often seek an expert opinion. You might visit your doctor or join the gym but if you’re really serious, you could end up with a personal trainer or speaking to a nutritionist. Regardless of how you do it, there can be no one size fits all for getting healthier. A meal plan given to you by someone who doesn’t know what you like to eat will never work and that’s exactly the same when it comes to your investment property. What has worked for someone else may not work for you. Once you know the goal, tweak your plan until you have a clear path, and if you need advice, don’t shy away from property managers thinking that they’re just out there for your business and to clip the ticket along the way. At Tommy’s, we have prided ourselves since we began, on taking struggling portfolios and turning up the heat! Each investor receives a personalised plan depending on whether they want to be more hands-on, hands off or completely removed. It’s exactly why we’re an award winning agency. If you know the goal, and you have a plan, you dramatically increase your chances of success. We’ll help you decide on how to get to where you want to get to.
It won’t happen overnight.
Have you ever set a New Years’ resolution to get fitter and healthier, done three sit-ups, not had a six-pack and decided to throw in the towel? It’s O.K. if you have, I promise you that you won’t be alone. Property investment goals are the same. Nothing will happen overnight just because you’ve decided that you want it to. Be realistic with timelines and keep taking smaller steps to work towards the bigger goal. It may take you two years to improve your portfolio if you’re trying to get the returns up more than 5%. Keep your eyes on the prize and if you’re working with a property manager, schedule bi-annual catch-ups to review your portfolio and the plan to make sure it’s all working and you’re heading in the right direction!
Our company was built on making a success out of other people’s portfolio and we welcome the opportunity to discuss what that success might look like for you. If it’s obligation free advice you’re after, or if you want to know what we would do to drive your portfolio performance through the roof, then please feel free to give us a call anytime!
For obligation free advice, and to find out how you can sharpen up your bite in the rental market, give us a call anytime on 04 381 8604 or email us.