In Show 075 – Using Social Media to Sell a Business originally broadcast on Facebook Live on Wednesday 28 March 2018 we explore this interesting topic.
Download the weekbook here: 075 Worksheet
Show Notes
As part of Phase 13: Selling your business we have been talking a lot about the best way to get ready for a sale. David Biddle has started many businesses over his career, including the lifestyle business Smart Boating. After selling that company he co-founded Brilliant Businesses a business broker that emphasizes the important of digital marketing. David has a really unique way of selling businesses by leveraging the power of social media.
David started his career working in the live event production business. Over the next fifteen years he worked all over the world in that industry. He staged conferences and live events for many blue chip companies. After a decade and a half he and his family decided to make a major change, moving from his home in the UK to Australia. He wanted to make a lifestyle change and so bought a yacht charter company down-under. He ran that business for ten years and it was during that time that he began to deploy digital marketing techniques to grow.
After ten years he decided to sell the yacht business. He started by looking for a good business brokers. Unfortunately he found it very difficult to find someone that really understood his business. Yacht chartering is a niche business t hat few brokers had any experience with. They struggled to find the right buyers and they seriously undervalued the company. He and his business partner leveraged their experience with digital marketing to sell the business on their own. They built their own website specifically designed to sell the business. They managed to sell within three months for double the valuation the brokers had offered.
David says people make many mistakes when trying to sell their business. But the biggest is not preparing properly. A rushed sale or an unexpected offer can lead to an owner making a bad decision. Not having the right paperwork is a huge error. Long term financials are a must as are monthly financial statements. He also says that having the right systems and processes in place documented is critical for a successful sale. Making sure the physical location of the business looks good is important. And most importantly, the owner has to be emotionally prepared to sell.
Most people will only sell one or two businesses in their life and the process can appear quite daunting. David and his team have put together and end to end approach acting as a trusted partner to guide owners through the process. David and his team start by making sure a prospective business is ready for sale. Accounts have to be up to date. Physical spaces need to be cleaned and optimized. Preparation also means that all the documents are uploaded to a data vault. That provides for a central clearinghouse for all information about the business.
Once that’s done David begins to pitch the prospective business to the marketplace. They do that by creating a tailor-made website specifically for the sale of the business. This is a standalone website separate from the businesses regular website. The website is selling the dream. It promotes the fantastic opportunity that owning this business will provide. The site features great pictures and videos that will engage a prospective buyer.
Next David promotes the opportunity to an audience. Rather than using a passive marketing approach they are much more proactive. They identify people that they think will be interested in the business and use Facebook, Google and LinkedIn to micro-target those audiences.
David says that if you setup your business to operate at maximal efficiency it will be much more easy to sell in the long run. A lot of business owners find that when they try to sell they company is far too dependent on them. It’s hard to sell an empty shell. Making yourself redundant from your own business is critical. The business should be able to operate without you before its ready to be sold. Finally, you should have a plan in place about what to do after the sale. Having a plan will keep you motivated during the sales process.
Connect
More about this Show
We started Business Legal Lifecycle to create a simple way for you to understand complex legal terms. Most importantly we want to help you to develop a plan to take your business successfully into the future. There’s a startling statistic the underscores the importance of developing a solid plan. The majority of business owners are just seven months away from losing everything. A single aspect of your business that is not set-up correctly can shut down your whole operation very quickly. Legal advice is not cheap and even when you can afford it there is often a divide between lawyers and their clients. We want to close that gap once and for all. We want to put legal knowledge and tools into your hand to prevent the worst from happening to you.
Twice a week we are going to deliver those tools right to your home or office with Business Legal Lifecycle TV. We’ll start the week with Fast Fix Monday, a short 5-10 minute video that will tackle a single issue that businesses have to deal with. Then on Wednesday’s our main show will feature with more fulsome discussions and interviews all delivered in a straightforward and easy to understand format.
In Show 066 – What to look for in an investment property with Scott Lachmund originally broadcast on Facebook Live on Wednesday 28 February 2018 we explore this interesting topic.
Download the workbook here 066 – Worksheet
Show Notes
Today we feature an interview with Scott Lachmund a real estate agent based in Caboolture. Scott is also the founder of 4510TV, a community run online TV station. Scott is a really interesting guy with a lot of great ideas about how to build a personal brand. He also some great advice about how to buy property as an investment.
Scott was born and raised in Caboolture and started working in the family real estate company shortly after high school. His first investment property was his first home that he purchased at 25 for $112 thousand and sold it for $250 thousand just a few years later. His experience building a business has largely been about learning how to manage people.
“Consumer behaviour has changed a lot over the last 25 years,” he says.
Scott decided to start 4510TV as a way to give back to the community. It started as a way to market the properties that his company was selling. Eventually he started to help market and promote local charities and other community events. The has resulted in a site that has garnered millions of views in just a few short years.
“It’s a community platform intended to share local stories that may be ignored by larger media,” he says.
Scott really believes that property is a sound investment. He has never used other investment vehicles because he loves the solid feeling of bricks and mortar. Scott has a number of recommendations for people considering buying. Location is the first consideration. Good access to shopping, schools and transportation is really important. He also says affordability and serviceability of a property has to be considered.
“You don’t want to be pumping money into a property that you can’t recover in rent,” he says.
There are ways to mitigate others risks like non-payment form a renter by using landlord insurance. You can also counteract the risk of a vacant property by purchasing in a location that is sure to have high demand for the foreseeable future. Much of this advice is applicable when purchasing your own home.
Scott says there are a number of people you need on your team before you purchase an investment property Getting good advice from an accountant is very important as well. They will be able to guide you through potential hazards like depreciation and taxable claims. The next person you need is a solicitor. Align yourself with someone that can guide you through the conveyance process. Navigating through title searches and other legal paperwork can be complicated so be sure to choose someone with lots of experience. A good real estate agent will have lots of information about a prospective property. From easements to flood reports there are lots of questions that need to be answered by your agent before you make an offer. Too often people end up purchasing a property without getting good advice. Don’t try and do this on your own!
Scott ended the conversation with a few book recommendations. The first is Tribe of Mentors by Timothy Ferriss.
“You can flip to any page and any paragraph in that book and find something relevant,” he says.
Scott added that Stop Thinking, Start Living by Richard Carlson is a book that every business owner should read.
“I think business owners have a tendency to overthink everything,” he says.
More about this Show
We started Business Legal Lifecycle to create a simple way for you to understand complex legal terms. Most importantly we want to help you to develop a plan to take your business successfully into the future. There’s a startling statistic the underscores the importance of developing a solid plan. The majority of business owners are just seven months away from losing everything. A single aspect of your business that is not set-up correctly can shut down your whole operation very quickly. Legal advice is not cheap and even when you can afford it there is often a divide between lawyers and their clients. We want to close that gap once and for all. We want to put legal knowledge and tools into your hand to prevent the worst from happening to you.
Twice a week we are going to deliver those tools right to your home or office with Business Legal Lifecycle TV. We’ll start the week with Fast Fix Monday, a short 5-10 minute video that will tackle a single issue that businesses have to deal with. Then on Wednesday’s our main show will feature with more fulsome discussions and interviews all delivered in a straightforward and easy to understand format.
In Show 065 – 10 Important Things to Consider when Buying a Property originally broadcast on Facebook Live on Monday 26 February 2018 we explore this interesting topic.
Show Notes
Today on Fast Fix Monday we continue our discussion about using property to invest in your business. We wanted to talk about ten things you need to consider before you finally decide to purchase a piece of property.
- Are there any water stains around the showers?
If there are water leaks that can lead to holes in the all and ultimately infestation by termites or other pests. - Are the ceilings sagging?
This goes to water damage as well. If you can detect a sag in the ceiling it’s a clear sign of previous problems with water. - Check inside all cabinets
It can be an easy thing to overlook but checking inside any cabinets where water pipes are located is really important. - Check the walls for large cracks
Any cracks greater than 2mm in width should be a cause for real concern. Once detected a qualified building inspector will be able to tell you - Mold in the bathrooms or bedrooms
Mold can often be dismissed but it can have a hugely destructive impact on your health. Check for mold that looks like dirty clouds on the roof. - Cracks in internal wall plaster
Small cracks in the plaster can indicate that the plaster was applied incorrectly. - Check external rooflines
You want to make sure those rooflines are straight. If they are not their may be internal damage that isn’t easy to discover. - Check for rusted roof gutters
Look for any rust on the inside edge of the gutter. They can look good from the outside but may be hiding corrosion inside. - Check the roof down pipes
The pipes from the gutters are easily overlooked but you want to make sure they flow into actual storm drains. If that isn’t the case you could end up with a flooded house of yard. - Check drain holes
This is particularly important with multi-story homes. There should be small holes above and below window and door frames. It allows water to escape and will prevent any water damage in the future.
More about this Show
We started Business Legal Lifecycle to create a simple way for you to understand complex legal terms. Most importantly we want to help you to develop a plan to take your business successfully into the future. There’s a startling statistic the underscores the importance of developing a solid plan. The majority of business owners are just seven months away from losing everything. A single aspect of your business that is not set-up correctly can shut down your whole operation very quickly. Legal advice is not cheap and even when you can afford it there is often a divide between lawyers and their clients. We want to close that gap once and for all. We want to put legal knowledge and tools into your hand to prevent the worst from happening to you.
Twice a week we are going to deliver those tools right to your home or office with Business Legal Lifecycle TV. We’ll start the week with Fast Fix Monday, a short 5-10 minute video that will tackle a single issue that businesses have to deal with. Then on Wednesday’s our main show will feature with more fulsome discussions and interviews all delivered in a straightforward and easy to understand format.
Accountant Partnership Plus – Starting a Franchise – What you need in place?
In Show 064 – Accountant Partnership Plus – Starting a Franchise – What you need in place? originally broadcast on Facebook Live on Thursday 22 February 2018 we explore this interesting topic.
Show Notes
Today, as part of the Accountant Partnership Plus Program we’re going to continue our conversation about franchises. In Phase 7 of the BLL we detail how franchising works and we’re going to share some of that information with you in this edition of the show.
A franchise has a very broad definition under Australian law. Basically, a franchise means selling your system and branding to another person. A franchise agreement will cover all the details about what you are providing to the franchiser. The franchiser owns the brand and the system but the franchisee gains the right to use those things. In Australia there is something called the Franchise Code of Conduct. This legislation regulates things like what needs to be disclosed and the expectations of the ongoing relationship. The whole point of the code is to ensure that everyone acts in good faith.
There is a temptation among some business owners to simply license their intellectual property rather than pay the sometime hefty franchise fees required by law. We strongly counsel against doing this. If you want to exert any control over how your IP is used you have to franchise. If you simply use a license and then make demands on the licensee you could run afoul of the law.
Choosing the right franchisee is a critical decision.
You don’t want to allow someone access to you business model who is going to foul up your brand. You have to make sure the person you are entering into an agreement with has a good reputation and a solid track record in business. We had a client recently who set up a franchise system in the coffee business. He brought in anyone that wanted to buy the franchise license. The problem was that he wasn’t training and selecting the right people. He eventually amassed something like 50 franchises. Unfortunately he was having massive problems with a number of the franchisees. We had to go through a long process of revamping his franchise process. Once that was done he stopped having all those problems.
The franchiser also has to give a disclosure statement before the signing of the agreement. It’s very tempting to fill out the disclosure agreement yourself. That’s very dangerous. Mistakes can lead to legal headaches in the future. If you haven’t provided the right information you could end up in years of litigation. Among the things you are required to disclose include revealing all current and previous franchisees that have been in business with you. You also have to be clear about all payments that will be required of the franchisee. There are standard fees that are outlined in the Franchise Code of Conduct.
Disclosure
Among the things you are required to disclose include revealing all current and previous franchisees that have been in business with you. You also have to be clear about all payments that will be required of the franchisee. There are standard fees that are outlined in the Franchise Code of Conduct. Another common element of a franchise agreement is the marketing fund. All franchise members can pay into the fund in order to purchase advertising and other marketing services. You also need to be clear about what is going to happen at the end of the franchise agreement. The final thing you need to disclose is all your financial information. You have to provide access to your books so that that the franchisee knows how much the business is making.
Before you sell the franchise you first need to detail how your company works.
That’s going to require a manual. We recommend that the person who runs the company should write the manual. It should include a brief description of what the manual is and who it is for. That’s important because you want to have it ready for any prospective employee to pick up and take with them. Next up is a history of your business, a list of services you provide and the contact information for everyone involved in the business. This section should include everything that you need to do before opening the business. If you are already operating your business you might not think this is necessary but it will be if you ever expand or sell the business. In addition to the names of all your employees you should also write down their roles and responsibilities.
Employment agreements, job applications and recruitment methods should also be written down in this section. You might well have a marketing strategy laid out for your business and it’s a good idea to have that written down. Local marketing, public relations and obtaining marketing approval should all be included here. You will find that there will be plenty of information that you will discover about your business while going through this process. It will also be a good refresher for your employees about what is expected of them. For more detail about how to write a manual we have more information on our website.
Franchise Model
The franchise model was developed in the United States and other Western countries to allow entrepreneurs to expand a business by essentially leasing the intellectual property to another operator. The IP and branding remains under the control of the original businessperson while the new business is operated by the franchisee. The Franchising Code of Conduct details how the relationship between the franchiser and franchisee should operate. If you fail to live up to those standards there could penalties. Royalty fees will be paid to the franchiser each month and there are other fees during the start-up phase.
Licensing, meanwhile, allows another businessperson access to your IP and branding. The difference is that the original owner maintain very little control over the new business. If you are going to license your IP to a new business but demand a lot of control over that new business you are actually a franchisee. You can be liable for any disputes in the future. It can be tempting to get around the franchise fees by using a license but that is risky. You can end up paying a lot more in penalties.
More about this Show
We started Business Legal Lifecycle to create a simple way for you to understand complex legal terms. Most importantly we want to help you to develop a plan to take your business successfully into the future. There’s a startling statistic the underscores the importance of developing a solid plan. The majority of business owners are just seven months away from losing everything. A single aspect of your business that is not set-up correctly can shut down your whole operation very quickly. Legal advice is not cheap and even when you can afford it there is often a divide between lawyers and their clients. We want to close that gap once and for all. We want to put legal knowledge and tools into your hand to prevent the worst from happening to you.
Twice a week we are going to deliver those tools right to your home or office with Business Legal Lifecycle TV. We’ll start the week with Fast Fix Monday, a short 5-10 minute video that will tackle a single issue that businesses have to deal with. Then on Wednesday’s our main show will feature with more fulsome discussions and interviews all delivered in a straightforward and easy to understand format.
In Show 063 – Choosing a Financial Advisor with Jason Cook originally broadcast on Facebook Live on Wednesday 21 February 2018 we explore this interesting topic.
Download the worksheet here: 063 – Worksheet
Show Notes
Investing in property is a major decisions. It can have huge implications for you and your business going forward. A sound investment strategy can reap big benefits. But if you don’t do it right it could cost you your livelihood. That’s why we invited Jason Cook to join us for this edition of the show. Jason works as a financial advisor with WB Financial in Queensland. He is also the author of the book Bulletproof Business. We’ve worked with Jason on a number of deals over the years and we are really excited to welcome him onto this edition of the show.
Jason first started working in the banking industry and eventually ended up lending to several high net-worth clients. He decided to leave the lending industry because he wanted to develop longer term relationships with his clients. He learned a lot from his years in the banking industry. But Jason feels that the bank’s focus on selling as much as possible took away from the customer experience.
Jason says that everyone should be thinking about investing but only 50% of people do it at the right time. He often gets a lot of clients in their 50’s who are starting too late. A lot of people think that they don’t have enough money to invest but Jason says as long as you have an income you can invest.
“It’s not rocket science.” He says. “If you start early the power of compounding takes care of it for you.”
Jason feels strongly that people should invest with an end goal in mind. Investing in property or shares is not the end goal. It’s what those things will ultimately be able to provide in the future. That might be the ability to take a lengthy vacation every year or to provide financial stability for retirement. Not many people actually make that plan. It’s all about what the investment can do for you. Not what the thing actually is.
The process of starting at investment portfolio should begin before you ever meet with your advisor. You need to understand your cash flow, your expenses and have a monthly budget worked out. Car repairs, house renovations and the upcoming vacation all need to be priced out.
When you’re considering who you want to hire as your financial advisor Jason says you shouldn’t be afraid to ask what their fee is. Finding out if they’re competent is important, of course. But in the course of the meeting you need to find out how much that competence is going to cost you every month.
“I believe in auditioning financial advisors.” He says. “Talk with three different professionals and decide which one you like. Don’t take the first person you meet.”
When Jason meets a new client he likes to know what level of risk they are comfortable with. Certain types of risk will achieve certain goals. The outcome you want to achieve may require more or less risk. More risk doesn’t mean the potential of losing all your money. It’s all about volatility. How big are the swings going to be? A low risk portfolio will have lots of cash and bonds. Those assets have very predictable values. That’s less true with certain kinds of stocks that can swing dramatically over the course of a year. A more aggressive investment strategy will perform better over time. But the key here is the phrase over time.
If you’re trying to decide whether to invest in property or shares Jason says there is now simple advice. He likes both of those assets. If its possible he likes to ensure that his clients have both in their portfolios. Each has different qualities. The biggest difference is the upfront cost. Property usually costs hundreds of thousands of dollars. Stocks can cost as little as a few hundred dollars. You can buy as much or as little stock as you want. Property isn’t a liquid asset – it takes a while to sell. Stocks can be sold instantly. There are also differences in the tax costs for each. There is one similarity, however. If you look at Aussie stocks or Aussie property over time – they have both increased at an almost identical rate.
More about this Show
We started Business Legal Lifecycle to create a simple way for you to understand complex legal terms. Most importantly we want to help you to develop a plan to take your business successfully into the future. There’s a startling statistic the underscores the importance of developing a solid plan. The majority of business owners are just seven months away from losing everything. A single aspect of your business that is not set-up correctly can shut down your whole operation very quickly. Legal advice is not cheap and even when you can afford it there is often a divide between lawyers and their clients. We want to close that gap once and for all. We want to put legal knowledge and tools into your hand to prevent the worst from happening to you.
Twice a week we are going to deliver those tools right to your home or office with Business Legal Lifecycle TV. We’ll start the week with Fast Fix Monday, a short 5-10 minute video that will tackle a single issue that businesses have to deal with. Then on Wednesday’s our main show will feature with more fulsome discussions and interviews all delivered in a straightforward and easy to understand format.
In Show 062 – 5 things to do before you Sell a Property originally broadcast on Facebook Live on Monday 19 February 2018 we explore this interesting topic.
Show Notes
Before you sell that property you’ve invested so much time and effort into you’ve got to make sure everything is in order. Phase 9: Investing in property is all about maximizing the return on your investment. So before you begin the sometimes arduous sales process here are the top five things you need to have in order before the sale.
- Finding the right agent
It might seems obvious that you will need an agent – but they’re not all created equal. The right agent can be very hard to find. You might want the most experienced person in the region or you may want a young go-getter. You should interview at least three to make a fair comparison. And don’t be afraid to ask for references! - Ask the agent for their marketing plan
How will you sell my property? What’s your direct mail campaign? How do you market online? These are all questions that are really important in determining how skilled their marketing strategy really is. - What makes the agent better?
You need to find out what makes a perspective agent better than their competition. The best way to do that is to simply ask them. Try and get them to provide three reasons why they are better or different. If they can’t answer it’s because they’re not. - Reviewing the documents
Once you retain an agent you will be asked to sign a disclosure and listing agreements. You want to have ample time to have those documents looked over by your lawyer. You don’t want to be reviewing these documents for the first time just before you sign. - Finding other professionals
An agent is just one member of the team you’re going to need during the sales process. Legal and financial advice is going to be just as important. You need to know if the agent will be able to direct you to those other professionals.
More about this Show
We started Business Legal Lifecycle to create a simple way for you to understand complex legal terms. Most importantly we want to help you to develop a plan to take your business successfully into the future. There’s a startling statistic the underscores the importance of developing a solid plan. The majority of business owners are just seven months away from losing everything. A single aspect of your business that is not set-up correctly can shut down your whole operation very quickly. Legal advice is not cheap and even when you can afford it there is often a divide between lawyers and their clients. We want to close that gap once and for all. We want to put legal knowledge and tools into your hand to prevent the worst from happening to you.
Twice a week we are going to deliver those tools right to your home or office with Business Legal Lifecycle TV. We’ll start the week with Fast Fix Monday, a short 5-10 minute video that will tackle a single issue that businesses have to deal with. Then on Wednesday’s our main show will feature with more fulsome discussions and interviews all delivered in a straightforward and easy to understand format.
In Show 061- The Secrets of Buying Property with Adam Jones originally broadcast on Facebook Live on Wednesday 14 February 2018 we explore this interesting topic.
Show Notes
Download workbook 061 – The secret to buying property with Adam Jones.
We’ve been discussing property as part of your overall business strategy. In this episode of BLL we welcome Adam Jones onto the show. Adam is the founder with Black Bear Investment Group, a property developer based in Brisbane. Adam is a former lawyer who has worked for many years managing and developing properties around Australia. We’ve worked with Adam and the rest of the team at Black Bear for many years and are excited to have him on the show.
Adam worked for several years as a lawyer but quickly found himself drawn to the property investment.
“It took less time, I made more money and I was having more fun.” He says.
Adam was fortunate to have entered the industry just as interest rates came down to nearly 0% in 2008-9. Holding property became much more affordable. His strategy at the time was building properties to hold for the long term. His first property was a splitter. He had learned enough to understand how profitable subdividing property could be. He made about $150 thousand on that property – which convinced him that this property game was pretty easy.
Adam sometimes feels like he wasted his five years at university. But he does recognize that law school provided him with some important skills. Knowing your way around a contract is hugely important in the property development industry. And the connections he was able to make as a law student and young lawyer proved invaluable once he shifted his focus to business. Most of what he has learned over the last decade has come from simply doing it. Because every project is so different it’s only by doing it that you can learn.
There’s a range of things Adam wants to see before he enters into a new project. He needs to have the right legal advice in place as well as the right accountants. The costs involved have to be well understood and he says he needs to fully understand what his current capacity is. The terms available from lenders is constantly shifting. What was true six months ago may no longer be the case. There’s no point in making bids on properties unless he fully understands all those numbers.
There are plenty of pitfalls when starting a new property development. Lenders suddenly changing the terms of a loan can impact more than just single project. Unexpectedly having to pay hundreds of thousands of dollars could have a catastrophic impact on his entire business. But getting electricians, plumbers and carpenters to complete projects in a timely manner can also be very tricky. It could take as much as six months to get a phone line installed. Careful planning is critical to making sure projects are completed on time.
Adam has been a pioneer in the use of syndicates to finance new projects. He started using this structure after realizing that his company had the capacity to develop more projects but lacked the funding.
“The cash requirements for a lot of new projects can be pretty intense.” He says.
A syndicate allows Black Bear to develop those new projects that wouldn’t be possible if they were only using their money. The syndicate is structured so that Black Bear develops the project, gets all the approvals needed and carries to completion. For the investors it’s largely a passive role but Adam makes sure to keep them updates throughout the process. They have developed eight projects using this structure.
Adam says that the best advice he has ever heard comes from the stock market wizard Warren Buffet.
“Be greedy when others and fearful.” Buffet said. “And be fearful when others are greedy.
Buffet was referring to the stock market but Adam thinks that lesson is very much applicable to the real estate world.
Adam’s advice for people thinking about investing in property is simple.
“Don’t take advice from me.” He says.
You have to find the right people to help develop a strategy that works for you. Everyone has a different tolerance for risk. Developing a good strategy with competent lawyers, accountants and real estate professionals is the key to success. If you’re not an expert find someone who is.
More about this Show
We started Business Legal Lifecycle to create a simple way for you to understand complex legal terms. Most importantly we want to help you to develop a plan to take your business successfully into the future. There’s a startling statistic the underscores the importance of developing a solid plan. The majority of business owners are just seven months away from losing everything. A single aspect of your business that is not set-up correctly can shut down your whole operation very quickly. Legal advice is not cheap and even when you can afford it there is often a divide between lawyers and their clients. We want to close that gap once and for all. We want to put legal knowledge and tools into your hand to prevent the worst from happening to you.
Twice a week we are going to deliver those tools right to your home or office with Business Legal Lifecycle TV. We’ll start the week with Fast Fix Monday, a short 5-10 minute video that will tackle a single issue that businesses have to deal with. Then on Wednesday’s our main show will feature with more fulsome discussions and interviews all delivered in a straightforward and easy to understand format.
In Show 060 – What Questions to Ask a Real Estate Agent when you Buy originally broadcast on Facebook Live on Monday 12 February 2018 we explore this interesting topic.
Show Notes
As part of our series on investing in property we wanted to give you some tips about how to deal with a real estate agent. There are a ton of questions you’re going to want to ask. Make sure you ask them before you sign the contract! We’ve helped many people navigate the sometimes tricky world of real estate. Over that time we’ve come up with the top 5 questions you need to ask.
How long has the property been on the market?
Some people disagree that this is an important question but it really does matter. If the property has been on the market for a long time the owner may be much more eager to make a deal. The same goes for the real estate agent.
Will the seller negotiate on price?
This might sound faintly ridiculous. After all, everyone wants the most money they can. You might not always get the answer you want but it will allow you to glean some information you can use in later negotiations.
Why is the owner selling?
If you know why they’re selling and if there is a deadline attached to that sale you will be able to tell just how eager they are. If you find out that they are moving out of town or overseas you’ll know that they are eager to sell as quickly as possible.
Has there been any offer? How much was the offer?
If there have been previous offers and you know how much they were you can alter your offer to meet or beat it.
What is the lowest offer they seller will accept?
A good agent will never answer this question but luckily not everyone is a good agent. You’d be surprised how often you will get this question answered.
This isn’t an exhaustive list by any measure. There are tons of other questions you”re going to want to ask. But this is the five that you should start with in order to get a good sense of what negotiating strategy will be most successful.
More about this Show
We started Business Legal Lifecycle to create a simple way for you to understand complex legal terms. Most importantly we want to help you to develop a plan to take your business successfully into the future. There’s a startling statistic the underscores the importance of developing a solid plan. The majority of business owners are just seven months away from losing everything. A single aspect of your business that is not set-up correctly can shut down your whole operation very quickly. Legal advice is not cheap and even when you can afford it there is often a divide between lawyers and their clients. We want to close that gap once and for all. We want to put legal knowledge and tools into your hand to prevent the worst from happening to you.
Twice a week we are going to deliver those tools right to your home or office with Business Legal Lifecycle TV. We’ll start the week with Fast Fix Monday, a short 5-10 minute video that will tackle a single issue that businesses have to deal with. Then on Wednesday’s our main show will feature with more fulsome discussions and interviews all delivered in a straightforward and easy to understand format.
In Show 059 – Buying Property 101 originally broadcast on Facebook Live on Wednesday 7 February 2018 we explore this interesting topic.
You can download the workbook here 059 – Workbook.
Show Notes
Your business is taking off and now you have to park those profits somewhere. That’s what Phase 9: Investing in property is all about. In this episode we discuss the different types of property you can invest in, what you need to think about before you sign and the due diligence process.
- There are several steps you need to consider before you buy any piece of real estate.
- Find the property that you want to buy
Conduct a visual inspection on the property
You would me amazed how many people purchase property with out ever having seen it. They simply take the word of their agent. A visual search will confirm that there are no obvious problems with the property but will also give you a sense of the neighbourhood. You should also conduct a pest inspection to make sure the property is vermin free.
Get your negotiation strategy read
There are many different tactics you can after you’ve made your initial offer. Steve Jobs would have a red line worked out before the negotiations even started and worked back from that. Others just start with their best offer right out of the gate.
Appoint a lawyer
You need to make sure you have someone on your side that knows what their talking about. A good lawyer will do all the right searches – from contaminated land to encroachments. A property transaction is a legal one and there are many government forms and duties that have to be dealt with correctly.
Settle the transaction
This is by far the simplest (and most fun) part of the process. It basically involves a bunch of people meeting and exchanging cheques. All the hard word has been done by the time you reach this stage of the process.
Completion and post-settlement
Your documents have to be registered with land titles or whomever handles the registry of land in your jurisdiction.
There are many different kinds of property that are available for purchase. Residential, industrial, general commercial, rural properties and retail shops. There are an increasing number of industrial properties being developed in large urban centres. Rural property is usually a more long term investment. You may have the hope that it will be rezoned or annexed in the near future but otherwise unless you’re planning on starting a cattle ranch this will be property you hold onto for a long time. A retail shop is a popular investment but you need to make sure all the zoning and other regulatory requirements are in order.
As we’ve discussed in previous episodes you can structure your business in a number of ways. The primary question is why are you buying this property? The answer to that question will dictate what entity you use. If you’re buying your primary residence you will likely do that under your individual name because of all the tax benefits you will accrue. If you’re buying an investment property, though, you might want to use a trust if it’s a positively geared property. There are many ways to do this but you have to get the right advice from your team.
More about this Show
We started Business Legal Lifecycle to create a simple way for you to understand complex legal terms. Most importantly we want to help you to develop a plan to take your business successfully into the future. There’s a startling statistic the underscores the importance of developing a solid plan. The majority of business owners are just seven months away from losing everything. A single aspect of your business that is not set-up correctly can shut down your whole operation very quickly. Legal advice is not cheap and even when you can afford it there is often a divide between lawyers and their clients. We want to close that gap once and for all. We want to put legal knowledge and tools into your hand to prevent the worst from happening to you.
Twice a week we are going to deliver those tools right to your home or office with Business Legal Lifecycle TV. We’ll start the week with Fast Fix Monday, a short 5-10 minute video that will tackle a single issue that businesses have to deal with. Then on Wednesday’s our main show will feature with more fulsome discussions and interviews all delivered in a straightforward and easy to understand format.
In Show 058 – 3 Top Things to Think About When Buying Property originally broadcast on Facebook Live on Monday 5 February 2018 we explore this interesting topic.
Show Notes
As we move into February we are starting Phase 9: Investing in property. As your company continues to grow investing your profits is going to become a paramount concern. This months we’re going to examine the best ways to use property as an investment vehicle.
To start things off here are the top 3 things you need to know before considering buying a property.
1. What entity is buying the property?
As we’ve discussed in previous episodes you can structure your business in a number of ways. The primary question is why are you buying this property? The answer to that question will dictate what entity you use. If you’re buying your primary residence you will likely do that under your individual name because of all the tax benefits you will accrue. If you’re buying an investment property, though, you might want to use the trust of it’s a positively geared property. There are many ways to do this but you have to get the right advice from your team.
2. The search engine is your friend
It may seem silly but checking the title on the property will make sure the person selling actually owns it. The potential of fraud is a very real one. Council searches and approval searches are really important to make sure that any changes made have actually been given the go-ahead. A Contaminated land search is hugely important too. You’re making a large investment so make sure you have all the information you need!
3. Encroachments
Many people think that encroachments won’t apply to them unless they live in the inner city. That’s not that case. When you do your plan search you should take special care to ensure that the boundaries of the property are in the right place. It doesn’t matter if you’re in the city or in the suburbs you don’t want to get a nasty surprise.
More about this Show
We started Business Legal Lifecycle to create a simple way for you to understand complex legal terms. Most importantly we want to help you to develop a plan to take your business successfully into the future. There’s a startling statistic the underscores the importance of developing a solid plan. The majority of business owners are just seven months away from losing everything. A single aspect of your business that is not set-up correctly can shut down your whole operation very quickly. Legal advice is not cheap and even when you can afford it there is often a divide between lawyers and their clients. We want to close that gap once and for all. We want to put legal knowledge and tools into your hand to prevent the worst from happening to you.
Twice a week we are going to deliver those tools right to your home or office with Business Legal Lifecycle TV. We’ll start the week with Fast Fix Monday, a short 5-10 minute video that will tackle a single issue that businesses have to deal with. Then on Wednesday’s our main show will feature with more fulsome discussions and interviews all delivered in a straightforward and easy to understand format.
