A new year means new resolutions.
What goals have you set for yourself?
Perhaps you’ve thought about your future; your investment plans.
What are you going to do this year in order to achieve them?
Sadly, it can all seem too overwhelming so although most of us start with the best of intentions, we never follow through.
We let setbacks get the better of us.
We let old habits kick in.
We make excuses.
But sometimes, all we need to push on is some real motivation.
My journey started at the tender age of 21 when I was working as an accountant.
Although I’m not a practicing accountant now, I’m very thankful that that was the profession I chose all those years ago.
I’m thankful because it was through being an accountant that I saw that most successful people had made their money through property.
I decided then and there that that was how I was going to become financially free myself.
So off I went into the big wide world of property investing, at first feeling a little bit out of my depth.
Although I’d spoken to plenty of successful investors and done a little bit of my own research before starting out, I knew that I was ‘green’, and I knew that I was bound to make mistakes, costly mistakes, until I learnt better.
My first purchase was a property in Surrey Hills in Melbourne.
It was very daunting.
Not just because I was such a novice undertaking a huge purchase like a house, but because it was around the time of the late 1980’s.
The recession had started and interest rates were very high.
But underneath all the first-time nerves I had confidence.
I believed in what I was doing and I knew that I had to do it or else nothing would ever happen and I’d never reach my goals.
Initially, I flipped all my properties.
I bought, renovated or developed, and then sold off for a profit.
This was how I thought you had to make money.
Eventually I learned about capital growth and how this was really the best way to create substantial wealth.
So with a switch of strategy, I continued buying but with the aim to hold on for the long haul.
By my mid 30’s, I’d acquired more than 20 properties.
Although buying to hold was my core strategy, as I acquired more properties I shifted back to adding in some faster income generating strategies, like developing and renovating, to help me afford my higher growth properties.
Whilst I’ve had many great experiences along the way and have greatly enjoyed the process of renovating properties, there have also been bad experiences.
I learned that unfortunately not everything always goes according to plan.
There have been instances where scheduling and tradesmen have cost me money, but I’ve also worked with some who are exceptionally good and help you make more money.
Having a team of trusted experts at your disposable is a critical piece of advice I would give to any aspiring investor.
I’ve also made mistakes just like anybody else.
I used to sell all my properties when I first started out as I thought this was the way to create wealth.
With transaction costs and taxes, I came to realise that this was a costly error and I would have done better to use the equity to reinvest.
Another mistake that comes to mind was a subdivision project I undertook on a very busy main road south of Perth.
Although there were various complications that contributed to its poor performance, when you rule out 80% of your market who won’t buy on a main road, it makes the prospect of profit all the more difficult.
These properties didn’t earn me the rewards I had expected and I learned that if I stick to my rules it’s pretty hard to go wrong.
After these setbacks or learning experiences as I like to call them now, I’d just dust myself off and get back up again.
I’ve undertaken some risky strategies in my time and I’ve bought when the economy’s been in a very rough state.
During these times, there were moments where I questioned my strategy or felt uncertain about my goals.
However, these worries and doubts were always short-lived.
I never really considered giving up because my experience showed me that even when times got tough or things didn’t go as planned, there’s always a way to make money.
Today, after all the ups and downs, I’ve still managed to grow a portfolio of properties worth around $15 million dollars and was a multi-millionaire by the time I reached 30.
Although I could’ve stopped investing, I didn’t and I’m still an active investor today.
I hope my story shows you that you don’t have to be rich to start with, you don’t have to have an extraordinary intellect, and you can afford to make some mistakes and still make money from property.
But, you do need two things; two things which I had.
One is self-belief.
Too many people sit on the sidelines waiting for the right time or they procrastinate year after year.
Ultimately, I think it’s because they don’t believe in themselves.
The sooner you learn that there’s never a perfect time, that fears can be mitigated with professional advice and research, and that you can do anything you set your mind to, the sooner you’ll be on your path to wealth.
Secondly, and very importantly, you have to have the knowledge.
As Benjamin Franklin once said ““If a man empties his purse into his head, no man can take it away from him. An investment in knowledge always pays the best interest.”