We Buy Properties Without Ever Seeing Them. And No, We’re Not Crazy.
Picture yourself buying a house. I'll give you 5 seconds.
What did you see? I bet you automatically visualised yourself walking through the property, perhaps speaking with the agent about the various features of the house.
Of course you would. That's how people buy houses, right? How else would you do it?
What if I told you that we buy houses… Without ever seeing them first or visiting them at all?
What if I also told you that on top of this, these properties are in the UK, literally halfway across the world?
If this sounds crazy to you, let me explain.
Getting Off the Emotional Rollercoaster
If you are buying a home for you and your family, you must absolutely see the house before buying it. It's important that the property feels comfortable to you and that the rooms feel spacious to you.
But when you are buying a property as an investment, feelings immediately become irrelevant.
Focus shifts to the numbers. Data. Logistics.
Less ogling the beautiful feature wall and more analysing the spreadsheets.
To this end, it's actually helpful that we don't personally visit the properties that we invest in, because it keeps us emotionally detached and off the rollercoaster.
What we want is a relaxing paddle down the stream of income instead.
Although our primary concern is with how much cash flow and capital gains the property will produce, we are very mindful of how the tenants or potential buyers (i.e clients) might feel about renting or buying the property. Our goal is to provide the best 'home' for them, not just another 'house'.
Property investing is a dynamic interplay between emotions and logic and everything must be kept in the right perspective.
We Shouldn’t Be Doing It Anyway
Another reason that we’re fine not viewing the properties ourselves, is because we’re not the most qualified to do the viewing anyway.
Our investment properties in the UK are not shiny new-build apartments common in Asia. We intentionally purchase old and tired properties that come with a myriad of problems, so we can fix those problems and add value to them. Sometimes they are more than 100 years old!
As you can imagine, it takes a trained eye to properly evaluate a property like that. We need to know if there are structural issues, damp issues, if the ground has moved from subsidence, if the electrics are up to regulation standards, and much more.
If we do the viewing ourselves, we could miss an important issue and cost ourselves a ton of money!
That is why we hire a professional RICS certified surveyor to diagnose the property for us.
The professional surveyor writes a full detailed report, outlining everything and breaking it down into simple terms. He evaluates the viability of the property as a purchase, and suggests a fair value for it which can be taken as reference.
We simply need to take this information and use it to make decisions on whether to go forward with the investment or not.
You can call me weird, but I always compare properties to a living, breathing organism. Evaluating a property by what you see on the surface, like the walls and flooring, is like a doctor evaluating the patient by just looking at the skin.
It doesn’t tell you the whole picture on it’s own.
You need to look beyond that and also consider the plumbing (blood veins), electrics (nervous system), insulation (fat) and more.
We wouldn’t try to diagnose our own body because we know that biological systems are interconnected and extremely complicated. So why we assume that we know enough to diagnose a property without professional training?
Another Perspective
Purchasing a property sight unseen might not sound so crazy if you switch your perspective a little bit.
How do you make your other investments? Do you need to “touch and feel” everything before you commit?
If you are buying shares in Facebook, do you need to go to the Facebook HQ in Silicon Valley and shake hands with Mark Zuckerberg before doing so?
No, you evaluate the stock as an investment prospect, look at the numbers (hopefully) and make a decision.
Admittedly, property investing is different from investing in stocks, because it is not as passive. You still need to manage the property, communicate with the tenants, and perform all of the duties of a landlord.
But this does not mean that you need to view the property yourself, or even be near the property physically. Leveraging various systems such as technologies and standard operating procedures and through recruiting the help of other people, we are able to manage the entire chain remotely. What a world we live in!
So there you have it. We do buy houses sight unseen, but we're not as crazy as you might have thought!
Sam Lee
Epic Property Investors Club Ltd.
Instagram: sam.lee.epic
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