Successful Property Investing Knowledge | Why Is It Important?

Successful Property Investing Knowledge | Why Is It Important?


– Hello, it’s Simon Zutshi here. And in this video I’m
going to share with you a tip that will make you a
more successful investor. So one of my favourite sayings is you don’t know what you don’t know. I’ve been investing in
property since 1995. I’ve been pretty successful. I’ve also made lots of mistakes. And I recognise it’s far wiser to learn from other people’s mistakes rather than making them yourself. So having an open mind, recognising you don’t know everything is a really smart thing to do. You can always learn from other people. And I sometimes meet investors who’ve been investing for 10, 20 years, and they’ve been really successful. They’ve had a particular strategy. They’ve just done that one thing and they’ve been successful. Because of that, they think they know
everything about investing, and that’s a very dangerous place to be. So you will always learn from other people who got different
experience, who are smarter, and maybe you can integrate some of the things they
know into what you do. So I’m here in New York
City at the moment. I’m here for a holiday. And wherever I go away, I like to connect around the
world with people I know. And there’s a friend of mine who’s actually a real estate
agent here in New York, and he sells property in Manhattan, in Brooklyn, in Queens, in the Bronx. And basically he doesn’t
sell individual apartments, instead he sells entire apartment blocks. So as you can see we are surrounded by apartment blocks here in Manhattan. And these things go for typically anywhere between five
and 100 million dollars. Now that’s not the kind of size property that I would generally buy, but I thought this guy’s
gotta know something that I don’t know that maybe I can use. So we were chatting and it
turns out that here in New York they have protected tenancies
on some of their properties. Now I think this is interesting
because there’s talk that if the Labour Party get
into the UK government, one of the things they might introduce is protective tenancy. So I was curious how it
worked here in New York. So what it means is the
local council designates some properties as a protected tenancy which means the landlord cannot
charge whatever they want, they can’t charge the
free market open rent. They have to charge a restricted rent. And they can only increase that by a certain amount each year. Now what that means is
because the rent is capped, it means that the value of
the property is also less than it would be if it was a free rent where they could charge whatever they want due to market prices. So what that means is
if you buy properties that are restricted rental income, the value of those is less. So there is a strategy here
or rather they used to be until literally a month ago. They’ve stopped this recently but this used to work for many many years whereby you could actually buy a block that’s got some restricted
tenancies in them, as in when those tenants move out, you basically spend money
renovating the property. And if you renovate it to the extent that you increase the rent over, I think it was $2,700 per month, then that’s outside of the
protected tenancy rental range. And so it’s no longer
a restricted property, it’s a free property. So over time you can
convert these properties from restricted to free rental which I said has a massive increase in the value of the apartment block. And so this is a way of
having forced appreciation. And there are things that
you can do to your properties to increase the value much quicker than if you’re just waiting
for the market to go up. So you can do things like
you can extend into the attic and add an extra bedroom or two. You can sometimes convert
garages into bedrooms. You can move a kitchen into a living room and turn what was a
kitchen into a bedroom. There are lots of things you can do to cause forced appreciation. But I thought this was
just a very neat strategy you could use here in New York. And the point is I didn’t know about it. I guess most investors
don’t know about it. It comes down to specialist knowledge. And if you wanna be more successful in property or in life in general, you need to have specialist knowledge. When I was a kid, one
of my hobbies was magic. And I got given a Paul
Daniels’ magic trick for my birthday when I was seven, and I absolutely loved it. And so I started to collect
Paul Daniels’ tricks. And my dad who was a GP, his business partner was
also an amateur magician, he told us about a magic shop
in London called Davenports. So I used to save up my pocket money and every year, twice a year, I used to go to this magic shop and I would buy some magic tricks. And at this particular
shop called Davenports, they started a club for young magicians. And I would go along there and actually I would learn a magic trick from a professional magician every week, and I got better and better because I was learning from other people rather than just learning myself because all the other
young magicians there, we used to do a big
Christmas show each year and I would learn from them in terms of their presentation style and the jokes they’d use, and I became a much better magician by learning from those people. Now I became so good that actually I started to do children’s parties. And when I was 15, 16, I’d do like a 40-minute magic show. This is back in the mid to late ’80s, and I’d get paid like 20 pounds
for a 40-minute magic show while some of my friends
were starting work and they might work in
the local news agents and they get paid 15 pounds for an entire Saturday to work there. So again this is an example of because I had specialist knowledge, I had some skills and knowledge that other people didn’t have, I was able to apply that
and I was able to earn a lot higher money because I
had those specialist skills. The great news for you is if you want to be a
successful property investor, you can find people who are
more successful than you who’ve done this before you and you can learn from them. So you can learn by reading books, you can learn by listening to podcast, you can learn by watching
videos like this. But also that one of
the best ways to learn is attending events. By going to an event, a training event by someone
who’s done what you want to do and they’ve become very
good at teaching that and sharing with other people such that they’ve got lots
of successful students, you can learn a huge amount
in a condensed amount of time. You can get specialist knowledge, learn things that other people don’t know which then gives you a
competitive advantage. So my friend here, the real estator who sell these blocks, he had a real competitive advantage because he had specialist knowledge that other people didn’t have. So I’d encourage you to
always have an open mind. Recognise you don’t know
what you don’t know. I’m always learning after over 20 years of investing in property, I learn from my students, I learn from other people. And I bet that’s one of the reasons that I’ve become even more successful. So invest in yourself, make
sure you keep up-to-date, and keep on building
your property knowledge. So if you enjoyed this video, please do comment below
if you got any questions. Please do like, please
feel free to share it. My name is Simon Zutshi. And as ever I encourage you to invest with knowledge,
invest with skill.

7 thoughts on “Successful Property Investing Knowledge | Why Is It Important?

  1. Great video Simon thanks for sharing. Maybe you can do some magic tricks at Property Magic Live or indeed as a webinar bonus. 👍😉

  2. Great information. The key is executing and taking action. Too many people watch and do little to nothing with the information.

  3. Liked the bit with forced equity increase. I want to convert garage to a bedroom in my own house. What I worry about is Brexit, if I put a money for garage conversion and in next year house prices will drop I will not get any increase in equity.
    Plan was to borrow the money for conversion and pay off loan after remortgage and pulling out some equity. What you think Simon?

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