Published on July 03, 2015

property investing is a business


“The pessimist complains about the wind, the optimist expects it to change, the leader adjusts the sails”
- John Maxwell

If you are a property investor then by default you are a business owner. You may think you’re an engineer with a couple of investment properties but as far as I’m concerned you are a business owner (in the investment propertyspace) moonlighting as an engineer to support you and your investment property business until such time as it can look after itself, and you.

So with that in mind I wanted to share some thoughts to help you be successful in your investment property business.

Do Something Important

At the risk of sounding like a Miss World Pageant contestant, you should live your life in such a way as to make the world a better place. I don’t necessarily mean the whole world, as great as that would be, but I do mean your world.

When I started MRD back in May 2002 I had a vision to impact the lives of others for the better. I would never be involved in the tobacco or junk food industries, no matter how much I was paid. Life (and business) ought not to be about how much one can get but about the positive change you can bring to others. If we offer genuine solutions that solve other people’s problems getting paid will never be a problem; it’ll be the consequence.

You invest in property not because you want bricks & mortar, a mortgage, a property manager and a tenant! No, you want what an investment property portfolio will give you; and that should be the freedom to choose your future.

You see, while ever you are a slave to your job or business you will not have the freedom to make choices. Time freedom to do the things you are passionate about is the result of having first created a form of passive income - income that pays you while you sleep, travel or volunteer your time in areas you are passionate about.

Set Goals

A goal is simply a dream with a date on it. Your dream may be for the financial freedom to choose whether to roll out of bed in the morning or roll over and go back to sleep.

Perhaps you love travel and those around you have heard you constantly express your desire to see Europe.

Until you put a date (or time-frame) on these, they are simply dreams but once you decide that you are going to Europe in 2017 and will retire financially free in 2025 you have now set goals.

Write your goals down

A form of television advertising that is not allowed is where an image of something is flashed on the screen so fast that your conscious mind doesn't take it in; but the subconscious mind does.

Let’s say this was a box of KFC during a footy match and it flashed up on your TV for just a fraction of a second. Studies have shown that many people would start to feel like eating KFC even though they are not aware of what just took place.

I don’t know if writing your goals down is powerful for the same reason but when you put your goals up somewhere where you see them regularly the likelihood of you achieving them increases significantly (on the fridge is a popular spot).

What are those things that you want to get out of life that you are not going to achieve by simply continuing to do what you are currently doing? Think about that question, discuss it with your partner and if it is important enough – no matter how unrealistic it may feel right now – write it (them) down and put dates to them.


This morning I met with a former MRD employee. She is now at an age where thinking about her future and getting started on her investment journey is a priority. She had set a goal to travel and for much of her 20’s she did just that, now she’s ready to invest.

I meet people all the time wanting to invest and the more common approach most people in my industry would take would be to facilitate an investment property transaction.

As I said to my former employee this morning, here at MRD we place a huge emphasis on strategy. Remember, I said previously that investing in property is akin with building a business and any successful business owner will first devise a business plan.

A lot of would-be-investors get scared off from speaking with investment property specialists out of a fear that they are going to have some slick salesperson do a sell job on them. I get that and I’d be extremely cautious too.

The unintended result of not engaging with someone earlier, however, is that when someone does make a buying decision it is often without the necessary strategy that they should have undertaken beforehand. This is how mistakes are met; either right from the outset or somewhere down the track.

Be guided - you don’t know what you don’t know

As a follow on from the above point, if you are building an electrical trades (or any) business you are going to need guidance. While you will no doubt already possess certain skills, you don’t know what you don’t know. Perhaps you have been a great tradie, smarter than most.

That’s fantastic but what do you know about employment contracts, BAS and Superannuation obligations, negotiating and entering into commercial leases, hiring staff, being responsible for PI cover and the list goes on and on.

A lot of small business start-ups stay small and then fail because the owners assumed they knew what they were doing. They assumed knowing their trade was enough, but it never is! One needs to know how to operate and grow a business around their trade.

Investing in property seems like a no-brainer to many because we all live in houses, townhouses and apartments. In most cases we have already bought and sold so we are already qualified, right?

MRD employs property strategists because strategy is at the core of what we do. I guess until you have experienced firsthand the value add that comes from engaging with a property strategist you cannot possibly appreciate the importance of the point I am making.

I encourage you to contact us (using the hashtag code: #propertystrategy) and see for yourself the extent of value that will come from such an engagement with MRD.

Get your finances in order

How your finances are structured will heavily impact the speed with which you will be able to grow your property investment business. When you sign up for a loan you enter into a contract and different lenders bury different clauses in their loan documents.

For example, it is to your advantage not to cross your loans (something which your bank will do 100% of the time if not stopped from doing so) but did you know that most lenders have an ‘All Monies’ clause in their contracts which means you give them access to any and all assets and cash they hold on your behalf as security for any and all debts you have with them?

That means that even if your properties are not crossed they sort of are anyway.

Before your loans are set up our finance strategist will first take the time to unearth your goals; immediate and longer term, to ensure you get what will best serve your needs.

When people fail to treat their property investing as a business they shortcut these important steps and sabotage their efforts for success. In a conventional business you’d speak with a lawyer and/or accountant about structure up front. Will you be best served as a sole trader or should you have a Pty Ltd company? Perhaps there is a need for a Discretionary Trust and if so what should the Trust Deed stipulate?

Taking the same intentional attitude towards building your investment property business and having things done correctly from the get go just makes common sense.

If you’d like MRD to speak with you regarding your goals and then assess your current finance structure in that context, contact us and (use the hashtag code: #financestrategy).

Choosing the right property

Choosing the property that’s right for you is a cake-walk, conditional upon you having first gone through all the preliminary groundwork that I have referred to above.
Next week I am going to continue with the theme of Investing in Property is a Business, focusing more on property types and when an apartment may better suit an investor than a house and land package and vice versa. I’ll discuss the importance of getting the cash flow vs. equity growth potential balance right and I want to look at the topic of when things don’t go according to plan and you have lost heart.

Where to from here

I invite you to allow us to spend time to strategise with you and add value to your efforts. You are building your property business so perhaps now is the perfect time to have a ‘check-up’. 

Contact us and use the code #propertystrategy or #financestrategy to indicate how you would like us to assist you at this time. We will happily do this as a no cost, no obligation service in the hope that we are able to win your trust and confidence over time; because we want to partner with you.

I look forward to meeting up with Sydney and Canberra clients this month; go here for details on how to secure a one on one consultation with me.

Nick Lockhart
Partnering with you for your investment success