How To Overcome Fear When Investing in Property

https://www.youtube.com/watch?v=BHqwSD5kG0k&ab_channel=OnProperty

Fear is something that can really hold you back from making progress in your property investing journey. What are some of the things we have done to overcome fear and move forwards both in investing and business as well as in life.

Advanced Suburb Research Course

0:00 – Introduction
0:52 – It’s normal to have fear
2:35 – Reducing fear when investing in property by having a clear strategy
7:40 – What type of investor are you? Short, medium or long term investor?
9:15 – Understanding market cycles
12:52 – Looking for the opportunities and understanding markets within markets
15:00 – Accepting fear and creating coping mechanisms that build you up

Transcription

Ryan 0:00
Fear is something that can really hold you back when investing in property and looking to buy and get into the market not knowing if it’s the right time. Is it too hot? Is it too cold? Is it going up? Is it going to go down? What’s going to happen? Fear holds so many people back. And we’ve both spoken to a bunch of people recently, we’ve been bumped into people, everyone’s talking about the property market at the moment. And something that inevitably comes up is fear about what’s going to happen, when they should buy, they should buy or they shouldn’t. So in this episode, we want to talk about fear, how to tackle that fear how we deal with fear in our lives, both when it comes to investing, as well as business as well as Personally, I’m sure some of you, it’s a really important thing to get a handle on. So you don’t just sit on your hands sit on your deposit for years and years and years, life passes you by and in 20 years, you’re in the same position you are today,

Ben 0:52
you know, that is my deepest fear. Like he told me about the I’ve always been one of those people where I’m like, I’m more scared of not having choices at 60, than I am at taking some action in my 20s and 30s. And so the number one thing that’s helped me with this, personally is an acceptance that I have fear. I’ve got like a 200,000 year old brain, in the back of my mind that is like why to constantly look for threats in the environment. And and you have,

Ryan 1:22
you have a more anxious brain than most people kind of experienced that anxiety and fear more than others. So

Ben 1:27
often, like I’ve gone through, I’ve spent my whole lifetime like with the brain that I’ve been prone with just noticing threats way earlier than other people do and 99.99% of them and just in my brain. They’re just shadows that I box with and spend energy on for no reason that are never real. That never come true. But I’ve sort of I’ve tried to do a fair bit of work personally and with psychologists around that To try and work through stuff. But every single day that stuff still catches you at

Ryan 1:56
what about you in the property market being as experienced as you are both personally in your property journey and buying properties for your own investments versus buying and helping to buy $250 million worth of property for so many clients? Do you still experience fear?

Ben 2:12
Yeah, and like fully, I don’t I mean, I don’t want people to like, I want them to know, like, every time I buy, I genuinely feel sick for about a month. Like I just don’t feel comfortable with massive amounts of debt. And I think anyone that does, doesn’t understand that history properly in our domain and what can happen down the line. So

Ryan 2:32
so what what have you done to tackle that fear and still take action despite that fear? Yeah. And what what works now versus what you did earlier,

Ben 2:41
the very first thing is having a really clear strategy. So for me, I’ve realized that I’m not like the buy and hold type of investor, you know what I mean? Like, I want to know, the data, I want to know, the comparable sales, I want to know, the agents, I want to buy the property at the best possible price. And so something that you helped me realize, as well as Phil Anderson, like years and years ago is that I like properties that are well timed. Like, I would have loved to have bought more property in Sydney in 2011. Because what a time to buy it like Yeah, I like 2020 2122 for Brisbane, because it’s like a good time to be a buyer. So it’s like, I like to time it. I like long term growth, which means a very particular style of Sydney, Melbourne, Brisbane, I like cash flow, like, I actually freakin love cash flow. So. So that means like,

Ryan 3:34
took me long enough to convince you that cash flow was a vibe, cash

Ben 3:38
flow is everything. And when your properties are producing extra cash flow every single week, it takes a lot of pressure on other parts of your life away. And then cause I’m an active investor with an active mind, I like to do stuff that adds value. Like I like to buy a three bedroom home and turn into a four bed, I like to find a piece of land and build something cool for the market. And so now that I know what type of investor I am, and also where I want to be in the future, which is over six figures of passive income from my portfolio. It’s kind of like cool, I just have to like do one little thing at a time. Yeah, versus getting caught out in the fear of the future.

Ryan 4:16
And I think this is the differentiation I’m seeing like in you and the people who are moving forward versus the people who are fearful and not moving forward is just that clear, long term strategy of where I want to be and how I can feasibly get there no matter what the market does, versus people, especially up here on the sunny coast, which is super hot, so hot right now. So the market up here is really hot right now. So people have people that there’s fear of missing out, but there’s also fear of what it is at the top of the market, but the people that seem the most fearful, and it’s friends of mine that I’ve been speaking to while I’m up here as well as other people. It’s just there’s no clear long term strategy. So okay, why are you buying this property? Where is this going to take you long term? And what are you trying to achieve? It just kind of comes down to, I don’t know, they’re buying property because they think they should, or they’re scared of not being able to afford the market. That’s definitely something that’s come up a lot. But when you have that long term plan, and I keep coming back to this, this with people, it’s like, Okay, I have they asked me, what’s the market doing? Tell me? Oh, well, I don’t know what the market is gonna do it. The next six months, 12 months, two years? I’m not sure like it could do whatever. But I’m like, Where do you think the markets gonna be? In 15 years? 20 years? 30 years? I love Do you think up here on the sunny coast? Do you think in Brisbane, do you think Sydney, Melbourne, Adelaide Perth, picky, picky area anywhere? Do you think it’s going to be cheaper in 30 years time than it is today? And do you think rents are going to be lower in 30 years time than they are today? And when you start to understand that, and you start to understand cash flow as well? And how if you buy a property that is cashflow, neutral or cashflow positive, as rents go up, what does that mean? It means you’ve now got more and more money extra that you can use to pay off your mortgage, which means you know, you could pay off your mortgage in 15 years or 20 years or something like that, in 30 years time, you’ve got a property paid out, right?

Ben 6:23
producing income for life reducing,

Ryan 6:24
is that property still gonna rent yet? If it’s in a good area? Yes. Is it going to rent for more than it is today? Yeah, probably because, you know, populations growing and all of that sort of stuff. And then even people who are fearful of the monetary system, and you know, what’s going to happen with the government printing money and inflation and stuff like that, if you own a core asset, like real estate that you own outright, and inflation goes through the roof or then like the your rents go through the roof, in terms of inflation, or if the currency like completely disappears, and we’re all running off Live Gold or all running off Bitcoin, then it’s like, Okay, well, now you receive rent in gold or silver, or you receive rent in Bitcoin.

Ben 7:03
But it’s like you didn’t go bad if I get in gold coins, so that you know whether things have happened, you own that asset,

Ryan 7:11
and you can rent that out. And even if the market completely tanks at drops 80% in value, you know, your net worth will be trashed, but you still momentarily, but you’ll still own that property, you’ll still receive rental income, you can still live off it, you’re not going to be like the people who lose their job, and have no money and you know, collecting food stamps or you know, need need support from the government. I love that very like that long term view,

Ben 7:38
you’ve got to have a long term view. And you’ve got to choose what type of investor Are you like? Are you a gambler? Like are you investing for the short term? Because you know, the butcher, the baker, the hairdresser told you that it’s the right time to be doing it? Or are you investing for a particular purpose? Now I invest in two very different ways. One is medium term speculation, buying Sydney, 2011, or Melbourne selling it in 2017. That is a very clear strategy. And if you understand the cycle well enough, you can you can quite clearly see those sorts of things coming. And then I invest for long term cash flow. So it’s like a simple house with a simple secondary dwelling or granny flat or exhilarate unit on the back. And I hope to own those out. Right. And that is like a business that produces cash flow for life that protects me like I think one of the biggest things that keeps people in a fear state is like the quality of the information and the people in their life. And so when you’re talking to other people that don’t understand it, like you’re either afraid of missing out or you’re afraid that it’s at the top and it’s Bob Lee and it’s about to pop. When you’re following like your core logics, your Heron Todd white, she feel Anderson’s you Fred Harrison’s like the on property channel, the pump channel, you’re following like, good quality information from a variety of sources, you get a bigger catchment to make an idea of and a strategy from slowly starts to like, like, let go of that feeling like and

Ryan 9:10
I think a big thing that has adjusted fear for both of us is understanding market cycles. Michael lived through Phil Anderson and through even just doing our own research, looking into different markets, including property markets, Australian property, American property, European property, looking at stock market cycles as well, mid cycle slowdown, even looking at like crazy Bitcoin cycles, and what we can learn from that about other types of cycles and even just like understanding the broad concept of cycles, and how they work and how people get into a frenzy, and he said something to me at lunch, you know, never underestimate how silly people can get when a market gets hot. Right and the decisions that they can make and for us understanding that like educating ourselves both on strategy how to invest in a low risk way or The education around that made us less fearful understanding cycles and then also understanding there’s always another opportunity around the corner. Yeah like you and I’ve been talking about the sunny coast severe while we’re up here and you know, it is hot at the moment, but then we’ve, we’ve been talking about okay in a few years when it does top out, and it does start to come down we’ve been talking about a buying opportunities for like, three years or four years time or who knows seven, seven years time whenever it is we’re patient with that we don’t know when it’s going to happen. But like we’re thinking about we understand market cycles, we understand there’s going to be a decline we understand that when declines happen properties at the top of the market tend to get reduced more they can be like really good buying opportunities. And we understand that so we’re looking at the market so differently everyone’s thinking about okay like it’s hot Am I going to miss out we’re thinking about I can’t wait for when that opportunity comes around completely bro.

Ben 10:53
You know, like the sunny coast for example, even that language like properties in Nursery in the last five years have gone from two mil to four mil properties in sunshine beach have gone from like one and a half mil to four mil. Then you can come down the coast properties in like, but Dana, for example, which is where we’re recording today have gone from 500k to 1.2 mil, another beach down the road car Monday, you can still buy stuff for under 700k. Right now. It’s like there is no like sunny coast thing going on. It’s like there is like markets within markets, some of the suburbs have been the flavor of the month and have gone nuts and others are like three 400k undervalued right now. And that’s what makes me less fearful and more excited. Like when you start peeling back the curtains and seeing like the variety in a market, you’re going oh my god, like it’s not all happening at the same time. Like I’m not going to miss out because the sunny coast is going up. If I’m looking at currimundi or Bodrum, or mountain Creek, there’s so much opportunity. And then once those go nuts, the next suburb and you know, like, this is what fascinates me, you know what I mean? And this is why I sleep so much better at night now than I used to, because there’s always going to be another time for a great buyer. Yeah, there’s always going to be an opportunity in another suburb or another city or another place or, you know, when you understand long term cycles that go up and sideways and up and down. It’s like, you know, people feel like they’re never going to be able to buy on the beach in Sydney again, for the prices they can today, I can guarantee within the next 10 years, prices in Sydney will be insane on sale. And some of them some people will be getting them for like 70 cents in the dollar to today’s prices. It’s like, I just trust that people speculate to the point where it creates booms and busts, as they have done for hundreds of years. And there will always be an opportunity for the strategic well timed investor. And

Ryan 12:48
that gets me excited. And I guess for us, it’s looking at those opportunities. So rather than getting caught up in the FOMO, or the fear of missing out, rather than saying oh my gosh, this March I better get in are all like never get in, it’s gone. No. As an investor what undervalued right now, what suburb up here is undervalued. And understanding the ripple effect of one type of it’s really expensive, the one next door isn’t, you know, people will eventually shift to the suburb next door and push the values out there, you know, understanding all this sort of stuff, understanding that suburbs are different to each other. And as you said, it’s not just the sunny coast or it’s not just Brisbane, it’s like those suburbs within that understanding how to do suburb research, how to do all that sort of stuff can reduce your fear. But again, it’s all comes with through the lens of what is my strategy long term, what am I trying to achieve? And then you do yourself a research to say okay, which area looks like it has the least red flags and can deliver me what I want long term. And you’ll find so many of those areas, if you do it and so you get less fixated on one area missing out there and more being like not okay, what fits into my strategy and we’ve done so many videos on suburb research that you can go ahead and check out for free on the channel. I’ve got a course that I created at onproperty. com. au forward slash suburb, you can check that out and I walk through how to research suburbs look for red flags, look for good indicators things like DSR scores vacancy rates vendor discount credibly powerful there’s there’s so many cool things to look at. So yeah, onproperty. com. au forward slash suburb if you want to check that out. But there’s also heat, like you’ve done free stuff on your channel. So I’ll link up to Ben’s channel. There’s free stuff on my channel talking about how to do it as well. It’s

Ben 14:28
when I think about like what’s helped me overcome my fi like strategy. Good team, understanding cycles in the market better is powerful, but like I woke up this morning, right? I didn’t sleep really well. And probably because we had such a good chat last night my brain was just like on fire.

Ryan 14:45
And I slept like a baby last night. Is it such a great chat.

Ben 14:50
I was like and I woke up and I like was like okay, I’m not feeling 100% but like meditated did the Wim Hof breathing and then went for surfing Awesome brekkie was like one of my best mates Ryan and my brother. And I’m like, that’s like, the way to overcome fi like, Don’t fight it, and don’t run away from it just accepting that, hey, I’m, I’m a human, and I’m feeling off today. And, hey, I’ve got some, like coping mechanisms, which helped, like, you know what I mean, versus the old days and just like hustling through overtraining, eating some shit food, following it up with another night of late sleep. And it’s just like, that’s like, the stuff that gets me excited. Like, you know, I’ve got friends who do just full time trading, and all of them meditate. It’s like, they can’t be effective traders. If their reaction speed is like lightning, it’s like they need space between thoughts and actions to make strategic decisions. And I love those things. You know what I mean?

Ryan 15:45
Yeah, so hopefully, that gives you guys a little bit of a grasp on you know, how we deal with fear and how you can deal with it when you’re property investing as well. It’s not, there’s no silver bullet to overcome fear and never have it again, we still have fear in business and in property and stuff like that. So that’s going to happen, it’s going to be normal, but there’s ways you can minimize it. And there’s ways that you can deal with it. So thank you so much for joining us for this episode. And just, it’s grateful. We’re grateful to share this with you. We hope it helps, and until next time, stay positive

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