Hi all, my name is Matt- first time, rather short time.
I've recently read Steve's books and like most here I am fairly fired up and ready to get started investing and learning and educating myself. I am nearly 25, have no debt and no assets, work a generic retail job with hospitality on the side and since finishing my Masters in Landscape Architecture 2 years ago have basically all but given up on building a career. I would much rather direct as much time and energy as possible to investing, forgetting the 9-5 and not having to rely on a career to survive, being free to pursue what I want.
Given I have practically no money, if I want to get into the game I need to do some creative financing and start learning about different techniques and concepts. One that has stuck in my head is simple spotting. I'd love to learn more about anyones experiences spotting properties, along with other techniques like simultaneous settlements. I know spotting would be hard work, especially for a novice, but it's also a good way to begin learning about property investment and building a network.
What kind of information is most important to an investor?
How in depth does a spot need to be?
Is it a case of 'the more, the better'?
Or are there really only a core set of criteria when it comes to making decisions on someone else's research?
Also what kind of spotting fee would be appropriate?
Obviously it is not going to happen overnight, and I know that success will only come if I put in the leg work. But I feel if I were to send prospective investors (after spending time networking and attending seminars) a package with as much info as possible- zoning, easements and crossovers, building permit potential, context, pricing, cashflow potential etc- then I may have a decent shot at providing a good opportunity for investors, while earning a little money and learning a lot on the side. I think I could add some decent visual information with my design background, but thats really just a thought at the back of my head, and it's really determined by investors information needs. Different investors would be looking to for different things, so that would be a learning curve developing a system and checklist about what to look for in every situation.
Thanks in advance for any advice and help, it's a little scary just starting out but exciting as well to know I've put some feelers out and will see what comes out of it.
Cheers,
Matt
Even when you do simultaneous settlements you still have to apply to the banks to purchase the property even if you plan to resell it later that day ie after a development application has been approved in the previous couple months when you had a long settlement. The only way you can sign up a property and assign it to someone else.
Is to
A) take a option on a property, (improve the value and onsell for a profit)
take a option on a property knowing your the only person there on the day bidding for example and that you can flog it off to someone else for a couple grand more as your "spotters fee"C) having a long settlement on a property that you signed and/or nominee on and then getting a potential buyer to buy that property off you and you sign over your nomination to them.
I'm just going to say that I don't know many people that make a sole income on just spotting. I know a few developers that also take a spotting fee if they see something good that another person hasn't seen and recommends it to them.
To be honest. I think a masters in landscape architecture you could start a business is designing landscaping for developments. Hell if your only in retail currently i would start ringing small to medium to large development companies and say Hey do you need a landscaping design done for your 4 unit, 6 unit, 10 unit block development. Ill do it for free. This is something you could do after hours at home. Give a couple designs away to a few small to medium size developers and build a business around it. Word will spread, set up a nice business doing something your qualified in and that use your business income to invest into property. It would be a low set cost low capital business. What do you really need a computer, your own brain. Plus being around these people that might even share some of their knowledge with you. You wouldn't of done a masters in something unless you were good at it or at least enjoyed the work.
You should do whatever makes you wake up in the morning and actually jump out of bed and not roll over dreading the coming day.
Great post Wilko,
Then as you develop relationships with the developers, you can learn about the property market as well. Where are you located? Are there many developments occurring in the area? I think it would be easier to start a business in an area you know in depth, rather than learn a new market (property spotting, then develop a business out of it).
John Lindeman and Terry Ryder are 2 big names in hot spotting. Or are you looking more at being a buyers agent? There are many BA on this forum or at rebaa.com.au (or am I totally off the track here??
.ChrisA1
Persistence is 'to keep on keeping on, no matter how hard the going may be'
Thanks for the replies guys, good to hear some other points of view.
Yeah Wilko I have actually contacted a few development companies, just looking to get a foot into the industry, although I haven't talked a lot about free design concepts which is definitely something I could look into. I think once I get moving in real estate investment I could definitely use my design skills to help increase a properties visual appeal, especially in the landscaping department, obviously. I'm located in Northeast Melbourne, so the growth corridor around Doreen etc is reasonably close by, but thats generally residential housing and usually estates have a landscape typology already. Not really sure what denser properties are being built around the place, but I'll definitely look into whats around and what opportunities might be available.
I don't really plan on being a spotter professionally, more thinking about ways to generate small lump sum gains, and am really curious as to how much information an investor would be after when considering a new property. Everyone would be slightly different, but I figure the more information the better, and would love to hear about what kind of information someone would pay even just a little bit to receive.
For instance I'm sure I could provide really good contextual analysis of a site, researching all the relevant codes and laws and maybe even a 3D model of the property, along with all it's problems. With suitable photos, I'm interested to see how helpful these kind of ideas would be to some investors, whether it would be welcome or merely tautological or even not needed- do most investors make site visits anyway before securing an investment? Would someone be willing to buy a property purely off models and images and information like that? And if not, what kind of information do people look for?
I'm not really at a stage yet where I can devote myself full time to being a spotter or any sort of investor, but while I try to build some capital and gain some experience, I'm just considering different methods and ways I could maybe offer something a little unique to an investing network.
Thanks again for the suggestions and advice,
Matt
take a option on a property knowing your the only person there on the day bidding for example and that you can flog it off to someone else for a couple grand more as your "spotters fee"
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