Making money from investing in property, seems like the obvious reason for taking on the challenge. Think about that for a moment. What does it mean to just make money? Money alone is worthless without a purpose.
The motivator behind you reaching your goals is knowing what it is that you want to do with the money you make. If you can define the why, you’re already on your way to building your dream lifestyle.
Pull up a comfy chair. I’m going to share my story with you, in the hope that you can learn from what took me years to discover. I’ll take you back to the time where I knew I just needed to make money, through to today.
It took me a long time and a shift in focus to make me understand that setting goals was the secret to getting the clarity I needed to prioritise my lifestyle goals over instant gratification.
Today, I’m building my dream home.
On the go? Here’s 30 seconds of take outs:
- Learn from those who have gone before you. I’ve been in the property investment trade since 1998 and am hoping that by sharing my story and the lessons learnt, you can achieve your goals with more ease.
- Investing in property takes patience. It is a long-term strategy that works best when you’re clear on the lifestyle goals you want to achieve.
- The three secrets to successful property investing are goal setting, life-long learning and looking to mentors that want you to reach your goals.
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Working hard to live in an affordable home in an inexpensive area is rarely the stuff of your dreams. Living in a home complete with the features you dream of, in a great location accessible to everything you love – now that’s a good dream to strive toward achieving.
Effective goal setting fuels dreams
In my new book, Property Investment SOP, the philosophy I want to pass on to investors centres around goal setting. By setting short, medium- and longer-term goals, you can progressively build a property investment portfolio that will fuel your dreams. Once you can sell a couple of your property assets, you then use the capital to fund your dream home, in a location that is highly desirable.
When I first started investing in property, goals were simply not a part of my investment strategy. All I knew back then was that I wanted to do something smart with the money I was earning. I knew I wanted to make money but I wasn’t sure why.
Visualising goals when you’re early in your adult years all seems a bit too grown up. If I only I knew how important goals were when I just started out. It took me years to grasp the gold in goal setting. Now days, setting goals and regularly reviewing my progress toward them is a part of my weekly, monthly and yearly routine.
I’ve been practising my property investment trade since 1998. I’m only now reaching a point where I’m in the position to build my dream home. A lot of people want to get to those big life goals quickly. The truth is, achieving anything worthwhile and fulfilling, takes time and dedication.
There is no ‘get rich quick’ scheme that works for the sustainable long term. If it sounds too good to be true, it always is!
Property investing takes a good investment of many years of focused effort. To make it work you need to have patience to see it through to the end. The long-term reward can be substantial if you see it through moments of short sightedness. One short sighted decision will disrupt your strategy, and set you back a way. Too many short-sighted decisions along the way will mean you’ll simply fail in property investment. Stay the path, I’m telling you it is worth it. I’ve got loads of knowledge and information to pass on to you to help you along the way.
Let me take you through how I got to be in this position where I’m now building my Sunshine Coast dream house. Why? To demonstrate to you how a simple strategy can make dreams come true.
My first property investment: 1998
I’d been in the Navy for about eighteen months. I’d just finished recruit school and category training as a marine technician when I bought my first property.
How did that happen? Well, lucky for me I got some good advice off my parents who were always on my back to save some money when I started earning down at Cerberus.
Regularly putting money aside in a savings account was the number one action I took that made all the difference to giving me a good start in property investing. When you go to the bank to borrow money for a property, the first thing the lender wants evidence of is a savings history. Thank you, mum and dad!
To strike my first property deal I leveraged off my parents’ experience. At that time we were living up in Bundaberg in Queensland. My mum’s philosophy on buying property was simple. She believed in buying close to the water so that the property was around one kilometre back from the beach, and a block or two away from a major road.
With that tip in mind, we’d drive down to the Sunshine Coast to explore property. I ended up going for a vacant block of land. It was a corner block around 450 square metres. I constructed a project home, rented it out for a decade and then sold it.
My mum was spot on, as later a shopping centre was built close by as the area continued to be developed. I bought the block for $58,000 and then built the house for $77,000. Yes! Land and building prices have gone up substantially since then!
My first property investment: 2000
My second investment property was on the Gold Coast – that water theme again! It was an older existing property with a small frontage of about 15 metres but was very deep. It was a big block of about 800 to 900 square metres. The house was a lowset brick and fibro construction, probably built in the 1970s or 1980s. To earn a decent rental income, it needed renovation. Mum and dad helped me out with the renovation. Big lesson number one: this property constantly needed updates and maintenance, eating into my cash flow. The new construction on the Sunshine Coast was a better proposition.
My first property investment: 2003 to 2007
Scarborough in Brisbane was where I chose to buy my next investment. Having learnt my lesson from the Gold Coast property, this one was a new construction. At the time, the purchase price was around $300,000. Big lesson number two: I now had three properties on principal and interest loans. It was difficult to manage. I didn’t know at this early stage in my investment career that I could have simply switched them over to interest only loans and helped my cash flow significantly.
I ended up selling this property a couple of years later, right at the time when I started to get some good clarity around how this property investment trade works.
Best lesson ever: education
After a few hard lessons, I started attending presentations and learning about how successful property investors were going about it. I read books and started to get into how goal setting would transform my life.
Clarity around the goals I was reaching for helped me to attain my next three properties a lot quicker than the earlier ones. In 2004 I bought a property in Logan in Brisbane. In 2005 after applying my new-found knowledge in what to look for in property criteria, I bought a place in Seville Grove in Western Australia. Then in 2006, I bought a property in Melbourne.
By the time I left the Navy I had five properties in my investment portfolio! Not long after finishing up with the Defence Force I bought two more houses in Melbourne – growing my property portfolio to seven!
A shift in focus
From where I was in 1998, I was at a completely different stage of my life. I got married in 2007 and starting a family was a shared goal. Because I’d done the hard yards and had a good investment portfolio we were in a solid position to sell a couple of the properties. That meant we could shift the capital gained into our principal place of residence, our family home.
This was a great strategy for me because I started investing when I was young. I didn’t start out, like many people do, by buying a principal place of residence. I grew an investment property portfolio first, instead. I get that a lot of investors I talk to are eager to get into their own place. Yet, building up an investment folio first, means you can then sell some of these capital appreciating assets to help fund your own home.
There is no way that I would have been able to save a quarter of a million dollars to put down as a deposit on my first home that I moved into.
So, the big lessons I’d like to pass on to you, right now so you can short cut some of the pain I went through are:
- Explore exactly why you want to invest in property. What are your lifestyle goals? Why are those goals important to you?
- Once you know why, it is easier to map out the how.
- Continue to learn and learn and learn. Property is not a passive investment strategy. You need to know your stuff and stay on top of where the market and your assets are at, all the time.
Education empowers you by putting you in control of your goals and how you’ll reach them. Read my seven-step philosophy in Property Investment SOP. The book builds my story and how I managed to build up a portfolio while serving in the Defence Force.
Get your free PDF copy here – www.propertyinvestmentsop.com.au