Photo by Steve Johnson on Unsplash
Some of my friends call me lucky because I’m so successful at making money. But you can make your own luck by putting in the work.
An example of this is when I bought a property that I sold a year later for more than double my original investment. You might also think that I was lucky because that’s not a normal situation.
I lived in London at the time and decided to buy a few buy-to-let properties. I couldn’t afford London prices, so visited a city where I’d lived a few years earlier. I knew the area fairly well, so I was confident I could find the type of property I was looking for. I traveled back there on 4 consecutive weekends and always lined up a few properties to view in advance.
The first 3 weeks I didn’t find any property I was interested in. The fourth weekend I viewed a few properties that also weren’t worth my time. I spent the rest of the weekend visiting estate agents.
I was starting to wonder if I had made a mistake, as most properties seemed to be overpriced but still sold quickly.
I then came across a very small real estate office that was run by the owner. He had around 30 properties on display, but all had been marked as sold, except two. One was over my budget, but the other was well below my budget. It didn’t look great, and I assumed there must be something wrong with it for it to be still on sale.
The owner said it was a bargain and advised me to take a look. So off we went. It was a 2-bed apartment in a mediocre estate. Certainly not the best place to buy, but not the worst either. It was on sale for £12,000 (this was many years ago). When I saw the inside, I realized why no one had bought it. It had been used as a drug den, and there were needles on the living room floor. Apart from that, it was in decent condition. I offered £9,000 and the owner accepted right away. We were still in the apartment at the time.
I hired a local company to clean up the place, give it a lick of paint and new carpets. That cost me £3,000. So I had a pretty nice place for just £12,000.
I then rented out the apartment for a year at £200 per month. That meant I was getting a 20% return on my money. Fantastic.
Well, not so fantastic because the woman that rented it stopped paying the rent after two months. Many months went by while the estate agent tried to get her to pay. About 6 months later, the estate agent stopped replying to my emails and his phone line seemed to be cut off.
I did some searching to find another way to contact him but then read that his business had ceased trading.
At this point, I wondered whether the estate agent had run off with the rental money. I still don’t know for sure.
I called the original building and asked him to go take a look. He reported back that the apartment was empty and that the neighbors confirmed that the tenant had moved out many months previously. I got the builder to change the locks and I put the property up for sale with another agent.
Within a week it sold for £26,000. So I’d made a profit of £14,000 minus expenses.
It was at this point that some friends called me very lucky. One said it was pure luck. He said he could have easily done the same. But the point is that he didn’t. I had to travel to the city for 4 weekends running. He lived in the city, so if it was so easy, why didn’t he find the property himself? I’m sure he wouldn’t have bought it anyway.
The property had been on sale for many months and had multiple viewings, yet no one bought this bargain. A few needles frightened them away.
Another friend that lived in the same city told me that he’d been looking for similar properties but couldn’t find any suitable ones. To him, that meant I was lucky. When I questioned him further, he’d viewed fewer properties than I had, even though he had much easier access to them than I did.
Luck did play a part though. I was lucky that no one else saw the potential in the property. I was also lucky that it sold so quickly later on. But I made my own luck. Look at enough properties for sale, and you’ll be lucky enough to find that bargain that everyone else misses.
If you don’t view any properties then there’s no way for you to get lucky. Of course, you may put in the work and not find a bargain. But that’s just the luck of the draw.
What helped me get lucky were the following:
I set myself a goal to buy 5 properties within 2 years.
I set up a process to find suitable properties.
I made the effort to view properties regularly.
I made offers when I found suitable properties.
Friends that didn’t get lucky didn’t do any of the above.
If you want to make money, you need a plan and you need to put in the work. You’ll eventually get lucky and the money will start flowing to you. This is a pretty easy way to make money.
