You might think that the biggest factor in determining your success in property is how well you can negotiate.
Our your knowledge of construction, or the planning system.
Or the ability to spot an opportunity to add value.
Wrong, wrong and wrong again.
From working with thousands of property investors, we know that the biggest predictor of success is setting good goals and having a process to work towards them.
By the end of this article, you’ll have four simple steps you can follow to do exactly that.
OK, so “Bigger purpose” makes it sound like you’re going to use property to cure cancer. Really though, it just means you should reflect on why you want to invest in property in the first place.
It might just be for fun or enjoyment, but there’s normally a bigger reason. It could be to secure your retirement, or be able to switch to working part-time, or move into a career you love, or have something to pass on… or something else entirely.
Don’t under-rate the importance of this step. Being clear on your purpose won’t just help you set goals: it’ll inform the types of property you buy, how you fund them, and practically every decision you make.
You might be clear on this already, and just need 30 seconds to write it down. It might be that you’ve come to the idea of investing in property without properly digging into why. Either way, get that purpose clear before moving on.
A “good” goal essentially takes your purpose and turns it into something concrete and specific.
A goal is a dream with a deadline. “I want to own ten properties” is a dream; “I want to own ten properties by the time I’m 40” is a goal.
A goal is specific. “I want to be rich” is too vague and subjective to even know when you’ve achieved it. “I want to have a monthly income of £5,000 from property in three years’ time” is more like it.
A goal should be ambitious. A goal of owning one property within five years isn’t going to get you far (unless that’s genuinely all you want). An ambitious goal will drive you forward, and even if you don’t quite hit it you’ll still have come a long way.
A goal is personal. Comparing your goals with other people’s isn’t going to be helpful. If you’re in debt, an ambitious goal might be “I’ll have saved up enough for a deposit within three years.” If you’ve got bucketloads of equity in your own house that you can release to invest, you’ll need to work harder to stretch yourself.
The ultimate test of a good goal is: will you be able to tell whether you’ve achieved it? Look at these examples, and you’ll see the difference between vague dreams and quantifiable goals with clear deadlines.
Bad goal: “I want to make money in property”
Good goal: “I want an income from property of £2,000 per month in five years’ time”
Bad goal: “I want to quit the rat race”
Good goal: “I want to have retired by the time I’m 50”
Sub-goals are the mile markers along the side of the marathon course.
They help keep you on track, and keep you motivated. This is especially important with property, where your main goal could take you years to achieve. It’s hard to stay motivated when the reward is many years in the future, but a sub-goal gives you smaller “wins” along the way.
If your main goal is to achieve a certain portfolio value, a sub-goal could be to get 20% of the way towards that target in the next year.
If your main goal is a monthly income of £1,500 per month, a sub-goal could be to buy a property that gets you another £300 towards that goal.
If you’re flipping properties with a goal of a certain annual profit, a sub-goal could be to have a property refurbished and back on the market.
You can even have less ambitious sub-goals, like being “investment ready” by having finished your research and spoken to a mortgage broker.
As long as it meets the criteria of a good goal and it will keep you motivated along the way, it will work as a sub-goal.
Goal-setting is a critical activity, but its purpose is to enable action. Just setting the goal won’t get you anywhere.
This is a more common mistake than you might realise. Lots of people feel great about themselves for having thought big and mapped out their goals… but that good feeling is so rewarding in itself, they forget to do anything to make their goals happen!
Having a goal (and sub-goals) help you decide what actions you need to take, so you’re not spinning your wheels and wondering what to do. The next step is to take those actions – and take them consistently.
There will be certain one-off tasks you might need to perform:
To make sure you get these done, set yourself a deadline and put them on your to-do list.
There will also be certain actions you need to take repeatedly to achieve your goals:
These need to go onto your to-do list as well, but they’ll be even more effective if you can make them habits.
For example, say you have a sub-goal of buying two properties in the next six months. You know from talking to other investors that you typically need to put in 10 offers to get a property at a price you’re happy with, and you need to view five properties before you find one you want to offer on.
So if you book in five viewings every week (perhaps batched into a single Saturday morning), you’ll be able to make an offer every week. Every 10 weeks, you’ll have an offer accepted.
That will get you to your goal with a few weeks to spare! So all you have to do is form the habit of booking in five viewings every week – perhaps by spending 10 minutes each morning going through the new listings on Rightmove.
As long as you carry out that daily habit, achieving your goal happens automatically and inevitably.
If all you do is follow the steps in this article, you’ll achieve more than 95% of people ever do. Don’t under-estimate the power of setting goals and developing the right habits.
For more practical tips and guidance to help you with each of these steps, check out our free goal-setting course as part of Property Hub University.
You’ll also learn how Property Hub founders Rob & Rob each go about setting their own goals.