Why Teaching Made Me a Better Property Investor
For twenty-five years, I was a mathematics teacher.
Today, much of my time is spent investing in property, buying businesses and building the systems and teams needed to manage both. On the surface, those might look like two quite separate careers.
Increasingly, I don't think they are.
I've been reflecting recently on the skills that have helped me most as an investor, and surprisingly few of them were learned from books about property. Many came from classrooms, schools and the thousands of young people and colleagues I worked with during my years in education.
Teaching taught me how to think about people, uncertainty, risk and long-term outcomes. Mathematics taught me how to approach difficult problems without needing to know the answer before I started.
It turns out those are rather useful skills for an investor too.
Teaching Encourages Long-Term Thinking
Education has unusually long feedback loops.
As a teacher, you do things today without necessarily knowing what effect they'll eventually have. You teach something, have a conversation or help someone through a difficult period and then life moves on.
Occasionally, many years later, you discover that something stayed with them.
I was reminded of that recently when a former student wrote about experiences from his childhood and how profoundly they had influenced the adult he eventually became. I knew him well when he was young, so reading his reflections many years later was particularly moving.
It also reminded me that we don't always recognise important experiences while we're living through them.
Property investing has a similar quality.
A sensible purchase doesn't necessarily look spectacular after twelve months. Its value often emerges over a decade or more through rental income, gradually reducing debt, good management and the slow compounding of capital.
Teaching made me comfortable with that timescale long before I became an investor.
Mathematics Taught Me How to Approach Difficult Investments
My background in mathematics has probably influenced my investment decisions even more directly.
Not because investing requires particularly complicated mathematics.
It doesn't.
The transferable skill is problem-solving.
When faced with a difficult mathematical problem, you don't always know the route to the solution before you begin. You establish what you know, identify what you're trying to discover and make a sensible first move.
That gives you new information, so you reassess the problem. Sometimes you continue. Sometimes you realise you've taken the wrong route and go back.
Acquisition analysis works remarkably similarly.
When I first look at a property or business, I never have perfect information. There may be an asking price, management accounts, rental information and assumptions about future performance, but there will inevitably be gaps.
The job is to work through them systematically.
What drives the income? How reliable is it? Which assumptions have the greatest effect on the return? What happens if interest rates remain higher than expected or costs increase?
Most importantly, how much room have I allowed myself to be wrong?
Good investment analysis isn't about predicting one outcome perfectly. It's about understanding a range of possible outcomes and deciding whether you're comfortable with them.
Good Due Diligence Requires Context
Working in challenging schools taught me another lesson that has become increasingly important when assessing investments.
There was always plenty happening.
An incident involving a student, a concerned parent, a staffing issue and several other problems could all be competing for attention simultaneously. Every one of them mattered to the people involved, but they didn't necessarily require the same response.
Knowing people made an enormous difference.
If you understand someone well, you know what is normal for them. You notice changes and can judge whether something requires immediate intervention or whether you need to listen and understand more before acting.
Due diligence requires similar judgement.
Every business has anomalies. Every property has problems. Finding them isn't particularly difficult if you look closely enough.
Understanding what they mean is much harder.
An unusual figure in a set of management accounts might have a perfectly reasonable explanation. Alternatively, something that initially appears insignificant can reveal a much more fundamental weakness once you understand the context.
Data matters, but data without context can be misleading.
That's why I increasingly want to understand the people, business and market behind the numbers before deciding what those numbers are telling me.
Scaling Before Understanding Creates Problems
Teaching mathematics also taught me that knowledge is cumulative.
There isn't much point trying to teach calculus if the algebra underneath it isn't secure. Eventually the gaps catch up with you.
I've found the same thing with property portfolios.
After buying a first investment, it's tempting to start looking immediately for the second. But ownership teaches things that acquisition never can: the real cost of maintenance, how tenants behave, how much cash you need in reserve, what good management looks like and how comfortable your borrowing actually feels when circumstances change.
Those lessons should influence the next purchase.
The same principle applies when acquiring businesses. Scaling an operation before the underlying systems are working doesn't normally remove its weaknesses. It magnifies them.
Growth doesn't necessarily need to be slow, but I increasingly believe it should follow understanding.
Relationships Matter More Than Most Investment Models Suggest
Perhaps the most important lesson I brought from teaching is also the hardest to put into a spreadsheet.
Relationships matter.
Schools taught me that understanding people usually requires investing time in them before there's a problem. That accumulated knowledge makes better judgement possible when circumstances become difficult.
Property is no different.
Successful investing involves tenants, agents, contractors, lenders, business partners, employees and advisers. The quality of those relationships influences outcomes in ways that rarely appear in an investment appraisal.
A property might be the asset on the balance sheet, but people determine much of what happens to it.
The Best Investors Keep Learning
When I began investing, I probably assumed experience would eventually mean knowing the answers.
Instead, experience has made me more aware of how frequently the answers change.
I think differently about debt today than I did twenty years ago. I place considerably more value on cash flow, management and flexibility. I'm more willing to walk away from an acquisition and much more comfortable changing my mind when the evidence changes.
That's another habit teaching encouraged.
A good teacher never really finishes learning. New students, colleagues and circumstances constantly challenge assumptions and occasionally demonstrate that something you've been doing for years could be done better.
Good investors should probably approach their portfolios in much the same way.
What Skills Make Someone a Better Property Investor?
If I had to summarise the skills from teaching that have transferred most directly into property investment, they would be relatively simple:
Think in years and decades rather than weeks and months.
Understand people before judging their behaviour.
Break complicated problems into manageable parts.
Accept uncertainty rather than pretending it can be eliminated.
Test assumptions and change your mind when the evidence changes.
Build strong foundations before attempting to scale.
Invest in relationships as well as assets.
Keep learning.
None of those lessons is specifically about property.
That's probably the point.
Final Thoughts
I've spent much of my life thinking of teaching and investing as separate chapters.
I'm beginning to see them differently.
The classroom taught me patience. Mathematics taught me how to approach problems. Leadership taught me to understand people and context. Property and business have given me somewhere new to apply those lessons.
Perhaps the biggest asset I've accumulated isn't the portfolio at all.
It's the ability to make slightly better decisions because of everything that came before it.
That's something I want to explore further over the coming weeks, because the more I look back, the more I realise that many of the things that have made me a better investor were learned somewhere other than property.
The portfolio compounds over time.
With a little reflection, perhaps the investor does too.