What Is It Really Like To Be A Property Investor?
Being a property tycoon is one of the main career paths that many millionaires and billionaires have cited as taking up their time. Investing in the right properties at the right time can definitely make a difference to your bank balance. While some investments may leave you working overtime to ensure your property is suitable to pass onto tenants or renters, other investments require next-to-no work and can become a part-time job in which you spend few hours a month actually working on it. While property investment might seem like the dream job (to those who don’t realize how difficult it can be), what is it actually like being an investor?
A lot like hard work
Investing in property often doesn’t just end when you sign on the dotted line. Often your new role as owner of the building means you need to be familiar with regulations and you need to ensure the building is up to code. Some building sales are more transparent with potential issues than others. For instance, viewing a property multiple times might not show you that its proximity to stadiums, concert halls, or bars can be felt – or heard – at night.
Whereas some buildings that are prone to weather conditions might not actually be required to disclose just how likely flooding might be or if there is a surprise sinkhole nearby. Ultimately, it’s a gamble when you invest in any property and what many people might not realize is that there is a lot of hard work that goes into ensuring the property can actually provide a return on that investment.
Some properties, however, are easy sales and require little maintenance before you can begin earning as a landlord or building owner. The pull here is the fact that many people think you actually have no work to do – that you simply buy a house, paint a few walls, and move in some tenants, but this is not the case.
Live off the land
In a study that discovered how much money you need to happily live for 40 years without working (which was decided on at between NZ$3 million and $4.5 million) only around a quarter of respondents suggested that they would retire. Indeed, another 22% decided they would change jobs – perhaps for one that would fuel a creative or altruistic passion, but not provide as much money. While another quarter stated that they would cut back on working hours. But interestingly, 27.1% of respondents claimed they would continue working as normal.
Maybe this is psychologically ingrained in us through conditioning throughout our lives, that we must work to live and live to work, or maybe this slim majority of people simply need to work in order to remain happy, financial woes aside. So even the ‘easy’ side of property investment might actually deter some people if investors do not need to be as strictly hands-on as they were in their previous occupation.
One of the main reasons people would opt to be a property investor is that you simply use capital to secure a building and then allow it to begin earning you money. Whether the building is residential or commercial and depending on the city and area it is situated in makes a difference, but even when giving away peppercorn rents, you still make money on the investment.
For some people, the enticing character of property investment is the pull, while for others it’s the idea that as long as you have enough money upfront, you’ll be able to spin that money into more money through keeping an eye on an easy property to manage.