Why are you investing in property?
Posted by markharrison on January 9, 2007
Last week, I got an email out of the blue from an old friend with whom I’d lost touch.
The guy in question is actually a bit of a hero to me, having made money in property, and retired in his early 30s to spend his life skiing. The last time I saw him face to face was in 2005, and he’d just flown back from Canada into Manchester for a few days.
I asked him “How many days did you spend skiing last year”, and he laughed.
“I worked it out recently”, he told me “it was 247.”
That’s right – of the three hundred and sixty-five days available in the year, he had spent pretty much spot on two thirds of them hurtling down a mountain, with two bits of wood strapped to his feet.
Don’t get me wrong – I enjoy skiing, but not enough to want to spend two days out of three doing it.
My motivation was somewhat different – I wanted to see my children grow up, rather than hear about it in the evenings when they were sleeping.
Now, if you don’t have children (or perhaps if you do), you may be able to think of no horror more vile than being stuck in a house with them seven days a week, but it’s not about what motivates my friend, or what motivates me. It’s about what motivates YOU.
Make no mistake, investing succesfully in property is like building any other sort of business – it is hard, sustained effort. The end-game is that by putting in that effort NOW, you can spend a lot more time doing other things in a few years time, once that business has grown into an ongoing, cash-producing asset.
The downside is that you need to spend the time now, to build that future asset, which is why motivation is so mind-bogglingly important.
If you are (as I and my friend are) motivated by the things that owning a property business will bring, and are willing to put in the effort early, then the chances are that you too will retire young, and do those things.
However, the people who make phenomenal amounts of money in property (think Trump, the Reichmanns) are like those who make phenomenal amounts of money in any business (Gates, Buffet, or closer to home Sir. Philip Green) – they build the business because what they actually love to do is… build the business. Any of those three, and for that matter many others, could have retired years ago, bought a boat, bought an island to moor the boat on, and lived out their lives in Champagne and sports cars. They choose not to.
I chose differently. This is why they are billionaires and I’m not 🙂
However, when the quiz question comes up “whose life would you like to lead”, I always answer straight up “mine!”