Have a butcher's at this thread from the Property118 forum. The original poster: Onslow Clough, has a potential dilemma on his hands and so has outlined what could be a life-changing decision for him.
Onslow lives in his own mortgaged home, is self-employed and has built up a reasonable buy-to-let portfolio of around twelve properties. He knows that interest rates will rise over the coming years and so is looking for ways to improve his investment and cashflow position - what should he do?
Well the first thing he is doing is to get input into the decision from other people, hopefully those more experienced than he is, or at least with different outlooks than he has. This reveals the power of the network and the property community. This if you like is the research phase.
The second is to consider what he wants out of this - he mentions improving the cashflow position of his portfolio for when interest rates rise so that his current income stream from his properties can help contribute to his total personal income. This is the goal-setting and planning phase.
Next, how he should go about things - should he sell his home or remortgage it, buy and sell or buy-refurbish-refinance, buy smaller properties or larger ones, buy local or further afield and potentially invest for capital growth or income instead? This is the strategy phase.
Once he has settled on his chosen strategy he can then go about implementing it by selling his home, buying the target properties and so on - this is the execution phase.
Finally, he can look at how well the investments have performed and compare them to the original plans and budgets - the review phase. There could equally be other steps along the way, however essentially this is a useful way of tackling the issue in hand - adopting a logical process approach to help with the decision-making.
So many people are attracted to the idea of generating wealth, additional income streams or just 'getting into property' that almost anything will do - just dive in and get going and figure the rest out later.
Property investing is a long-term, wealth creation strategy and involves large amounts of money and / or asset values (at least compared to the weekly shopping bill or annual summer holiday say) and yet many of us do not sit down and take the time and steps outlined to work through the decision in such a logical and considered process-oriented way.
It really is worth the effort and can help to avoid making some of the costly mistakes of many that have gone before, myself included. Yes, I also know that some people are more spontaneous or intuitive but in business, we also need some analysis and planning I am sorry to say.
Therefore, I applaud Onslow here and especially for maintaining his patience when people make suggestions that could in fact challenge what his initial idea is. There is nothing lost but a little bit of self-pride should he decide to change course and equally so much to gain from taking these deliberate steps and external input also.
Do we always adopt such a well thought out approach to our property investment decisions I wonder? If we adopt a similar approach to Onslow then maybe, we will get even better results than if we just 'keep calm and carry on'...
Nice one Onslow!
Source: http://www.property118.com/life-changing-property-career-decision/68626/#comments