Property Brain Games
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The psychology behind successful property investment
Investing in the real estate industry is an art on its own. The tricks of the trade from securing a good deal, growing your property investment portfolio to managing your properties need a fair amount of strategising.
It’s a mind game both internally and externally; the decision-making starts from you, hence there are numerous decisive actions to be taken. Property investing requires dealing with numerous stakeholders, therefore one needs to be persuasive yet accommodating in order to achieve their objectives.
Without a proper internal structure, one will not be able maintain yet alone pursue a successful property portfolio. So what is the psychology behind investing?
IT BEGINS WITH YOU
Property investment falls under the category of business psychology. According to a psychologist from University of Malaya, those with an interest in property investing has to treat it like a business instead of a hobby as it involves money, numerous stakeholders and success margins.
By equating property investment to a personal business, one will become more vested in the matter which will lead one to conduct numerous researches and verify the information. This would entail skills such a being analytical, resourceful, possess good judgment and able to make executive decisions.
Dayana Rahman from Help University says, “Starting anything new is usually a difficult process and requires self-discipline. But over the long run, the behavioural patterns picked up through the process of buying a property would become ingrained and habitual.”
WHEN ARE YOU READY?
Investor Kam Wei Tsung points out, “Homebuyers and investors have to have a game plan ready, there is no reason to rush into a purchase just because your friends are doing it or someone told you so. You must know how you will manage the property, from financing, maintenance and exit strategy.”
Often an exit strategy is not discussed in the context of property investment. However, in the current market, it is important for individuals to have a full contingency plan in order to not part with their money needlessly, or worse, go bust. The art behind a game plan is knowing where each step would lead you; remember to always fall back on your initial goals or objectives if you get carried away from the game plan.
Understanding the subject matter is crucial, hence property gurus, property investment books and seminars are important to have as references. The psychology behind it is to know who to trust and what works for you. There is no shortcut to this however; it relies on a goal set by you.
The UM psychologist points out, “The moment an individual selects a method he or she wants to emulate is the first step in their decision making process. By exploring the different facets of an ideology, one is already making all the calculated decisions to commit.”
According to risk management lecturer Hidhir Mohammed from Putra Intelek International College (PIIC), any individual who made the decision to never take their commitment lightly will go through a series of internalisation, which allows the buyers or investors to be at ease with their decision.
IT CAN GET LONELY
Hormones and emotions govern our bodies; so it is up to us to keep ourselves balanced and healthy. Positivity from a good support system releases hormones such as endorphins, which stimulates the feel good vibe needed by an individual to pursue anything they want, according to medical professional Dr Shanti Mugenen.
If you pay any attention to the success stories of property investors, you would have noticed they would always thank their partners for being understanding and patient. Investing requires time away from your loved ones; viewing properties, meeting agents and negotiators will take up the bulk of your time.
Surround yourself with a good support system; discuss the matter with your family, partners or close friends first. By having their support during tough times, you will not feel lonely or isolated because there is a positive support system to safeguard your personal state of mind.
Sandeep Grewal from Freeman jokes, “It can be very boring, but having the right team to work together and push each other is the key which then turns to fun.” The economic climate has pushed many like-minded people to come together in their pursuit of property investing. As any rookie investor would say, ‘it was the notion of financial freedom that led me here’.
Going through the process as a team allows for faster knowledge sharing, which is key in property purchasing as time is money, especially in hotspot areas. Furthermore, one would feel a sense of belonging with a team, which would motivate them to weather any rough days.
Sandeep points out how site visits can be turned into a fun activity with the right group. He says, “We often turn it into a food hunting expedition within an area under the pretext of market research and while negotiating with developers, vendors or agents.”
Besides research and analysis, it’s also important for you to stay level headed and enjoy the process with a group of people who is supportive of your decision in order to succeed in property investment. It’s good to be part of a team during bad times; by sharing your problems with like-minded people, you can get words of encouragement, advice and ideas to refine the failures or methods to get your property.
THE RIGHT TEAM/PEOPLE
Property investor Hazel Leong amasses property through auctions, and she credits her success to her team. She says, “My team does everything for me, from vetting through the documents thoroughly to dealing with tenancy issues. I rely on them to provide me with the best advice from the legal and banking stand point.” Although one cannot substitute self-research and discipline, one can enhance their capabilities with the right group surrounding them.
Vincent Ng, CEO of Kim Realty, explains that he trains his agents to be sincere, honest and provide accurate information to their customers to ensure that a strong rapport can be maintained between the agents and buyers or sellers.
This sentiment is echoed by Colin Tan from ColinTan Group of Companies during a speech entitled the ‘Psychological And Professional Requirements To Succeed In Real Estate’. It is a two-way communication as the trust obtained from the agent would entail a good long-term relationship which benefits both parties.
The right team would not allow you to stray away from your goals and would instead complement your success. To find the right team, you need to start at the very beginning of your property investing journey.