Whilst investors feel that they are comfortable in their chosen methodology and strategy within property such as they are comfortable with focussing on their HMO strategy, or Rent2Rent or serviced accommodation and they go fully into that one chosen strategy which consequently over exposes themselves to such potential issues i.e. changes in law, more issues with tenants that they did not envisage, or there is an oversupply of multi room lets in that particular area. Consequently your portfolio may start to suffer.

However in property and business in general when you become a professional investor you should have a diverse portfolio. In property you can do multiple different strategies such as multi let using your own funds or investor funds, you can do Rent2Rent deals and serviced accommodation as well as land development and commercial conversions. Thereafter over the course of 3-5 years you can diversify into other areas in order to not over commit yourself in one area just in case the market changes which allows the remaining of your portfolio to cover your losses for the unforeseen market shift and allow you to stay on top of your cashflow.

However there are a couple of things you need to be aware of one of which is that you cannot go into all the property strategies at the same time in the very beginning. Therefore it is important to get lazer focussed on your primary strategy. Where will you spend 80% of your time focussing on your property business i.e. your primary strategy will it be Rent2Rent, Multi-Let, development opportunities. Thereafter 20% of your time can be focussed on your secondary strategy, for instance your doing some research, sourcing deals, making relationships with agents.

If you do not spend 80% of your time on your primary strategy and you spread yourself too thinly you then think the particular strategy you spent your “so called” 80% of your time is useless and the strategy does not work. Thereafter consequently you then believe none of the strategies work however in reality as an investor you are trying to focus on too many strategies at the same time rather than being lazer focussed on your one primary strategy where you can build your portfolio to the level where you can replace your income. Once you have made that particular strategy a success you can then bring your work that you were undertaking within your 20% of allocated time to your 80% as you are in a more secure position to diversify your portfolio. Therefore your 80% of time can shift depending on the stability of your primary strategy.

In summary, it is important to diversify your risk and in order to do so you need to have different strategies within your portfolio. However you cannot initially focus on too many strategies. Once you have made your primary strategy a success and have executed 10 deals then you can start to diversify your portfolio in order to minimise your risk.

Best of Luck!