7 masterskills of wealthy property investors

Most Australians spend forty years or more preparing themselves for retirement, yet over 95% of them fail.

They remain dependent on the government for their main source of income.

However a small group of wealthy individuals reach financial freedom in a fraction of the time, many through strategic property investment.

I’ve found these wealthy investors have mastered seven skills that makes it easier and faster for them to achieve financial prosperity.

Let’s examine these master skills:

1. Creating and controlling capital

The wealthy understand the importance of building a substantial asset base.House shop buy property

Some do this by building a business while others grow a sizeable share portfolio, but my preferred method is growing a multi-million dollar property portfolio.

Smart investors know how to create and add value to their properties using techniques like renovations and development.

They also add value through their expertise or through smart negotiations and buying well.

And it’s no coincidence that the wealthy control as big an asset base as they safely can by leveraging and borrowing against appreciating assets.

2. Transforming capital into passive residual income

Successful property investors grow money trees and recognise that cash flow is the fruit.

This means that once they have built a substantial asset base, they transition into the cash flow stage of their investment life by lowering their loan to value ratios and then borrowing against and living off their equity.

Savvy investors follow these 4 rules of capital.

  1. They concentrate it – rather than diversifying, they focus their energy and efforts on their area of expertise.
  2. They don’t risk it –once they’ve built a substantial capital base the wealthy invest rather than speculate. They are prepared to forgo a “potential” future profit not to risk their current assets.
  3. They protect it – by owning their assets in the correct structures to safeguard their capital and by having financial buffers in place.
  4. They value it – professional investors don’t eat away their capital. Instead they convert their capital into cash flow and live of the fruits of their money tree.

3. They are financially fluent

money piggy bank smart save savingsSmart investors recognise it’s not how much money they make that matters, it’s how hard their money works for them and how much they keep that counts.

So they learn how the finance, tax and legal systems work and how they favours investors who treat their properties like a business.

The wealthy understand the language of accounting and know how to read balance sheets and income statements, understand how to calculate the Internal Rate of Return on their investments and how to assess their different investment options.

4. They understand the importance of building a great team around them

Savvy investors know they can’t do it alone; so they recruit, direct and refine a team of finance, tax, legal and property professionals.

They know that if they’re the smartest person in their team they’re in trouble.

As CEO of their property investment business, the wealthy don’t abdicate control of their money to others.

Instead they set up systems to evaluate the performance of their investments and their advisers.

5. They are decisive

Way back in the 1930’s Napoleon Hill discovered that successful people had the habit of making swift and committed decisions.

This principle, which is just as relevant today as it was almost a century ago, holds the key to determining the level of success you will achieve.

Successful property investors are able to see the big picture and don’t seem to get caught up in detail.

They assess the situation and take decisive action.

6. They understand the true importance of money

The wealthy recognise that to be truly prosperous, they need a lot more than money. 

Sure money is important in those areas of life where it is important (such as paying the bills), but it’s not at all useful in those areas where it is not important.

They have the time to enjoy it; the relationships to share it with, the sense of purpose and passion with which to direct it.

Wealthy people have much more than just money.

And they understand the importance of contribution to the community, which brings meaning to their lives.

On the other hand I’ve found that most people who don’t have money spend so much time struggling to make money that they lose out on the quality of life they deserve.

However when you have enough money you can go about creating real wealth.

7. They have the capacity for growth

Wealthy people are voracious learners.

They know the fastest way to wealth is through consistently investing in their personal development.

They read books, attend seminars and cultivate relationships with mentors who can advise and guide them.

They also network with other positive wealth builders with whom they can mastermind and bounce ideas off.

It is no surprise that the more they grow, the more their wealth grows.

What about you?yes_no_to_money

When you are truly wealthy, when you have all the money that you need, what is your life going to be about – above and beyond the money?

Remember money is just a power that amplifies your ability to live your life to its real purpose.

It’s no use just chasing money, so what is your vision for your life?

What is your purpose?

What are your values you will strive to live in accordance with?

It’s this focus on living consistent with your purpose and your values that will give you a balanced and fulfilling life.

Also published on Medium.

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Michael is a director of Metropole Property Strategists who create wealth for their clients through independent, unbiased property advice and advocacy. He's been voted Australia's leading property investment adviser and his opinions are regularly featured in the media. Visit Metropole.com.au

'7 masterskills of wealthy property investors' have 7 comments

  1. October 12, 2012 @ 7:26 am Thomai Garvin

    Thanks Michael
    I really enjoy your blogs that focus on mindset rather than just the numbers and stats. It gives a different perspective to what makes a good property investor


    • October 12, 2012 @ 8:10 am Michael Yardney

      Thank you Thomai
      If you’ve been reading my blogs for a while you will realize the importance I put on mindset.
      While the knowledge, systems, facts and numbers are important, in my mind that only makes up around 20% of property investment success. The balance is having the correct mindset.

      BUt that’s really much the same in everything in life – isn’t it?


  2. October 12, 2012 @ 11:24 pm Dan Popping

    Thanks for another great read and good insight into having the right mindset to both create and manage wealth. I also agree that giving back to community is integral to this.
    Cheers Dan


    • October 13, 2012 @ 6:43 am Michael Yardney

      Thanks for the kind words Dan.
      you’re right there’s more to it than just creating wealth – the right mindset helps you manage and keep it.


  3. August 16, 2015 @ 9:30 am Piyush

    Another great article Michael. I have reading this every day for some time and I agree since I have started working on the mind my approach is changing towards investing and many things that matter in life . I wait for these 4 AM emails


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