Another 8 property investment myths

Do you know that 15 common myths that are killing the wealth potential of the average Australian property investor?

Last week I explained how despite us living in a land of plenty, the sad reality is that the majority of Australians will never achieve financial freedom.

Yet, on the other hand a small group of Australian property investors are becoming very wealthy.

Today I continue exploring these common money myths which hold many people back from achieving their financial goals.

The first 7 myths:

In last week’s blog I explained how the following myths are reasons – actually excuses – used by the average Australian to explain why they’re not richer than they are:

  1. It takes money to make money  Hasbro Announces New Monopoly Playing Figure
  2. I don’t have enough money
  3. My job and superannuation will take care of my financial future.
  4. I’m not smart enough.
  5. Investing is complicated.
  6. Investing is risky.
  7. You have to know how to time the investment markets.

Well…I debunked those myths last week in Part 1, so let’s move on to….

Myth # 8:  The rich are lucky

The truth is that success in wealth creation is no more about luck than is success in anything else in life.

To become wealthy you have to be in control of your finances and not count on good fortune.

When you have a proven investment system or strategy, luck becomes unnecessary.

As a child I used to play Monopoly. 

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Sometimes I won, sometimes I lost.

As an adult I’ve played Monopoly a couple of times with some financially intelligent people and I realise now that, contrary to what I thought when I was young, it’s not a game of luck.

Good players know the right spots on the board to get the best return on their investments.

They know how to acquire and control the best “monopolies” in order to collect the highest rents.

They’ve learned to negotiate and find ways to make great deals.

They’ve learned how to take the luck out of Monopoly and consistently win big as a result.

To me, this sounds a whole lot like the real world of investing.

You need to learn how to take the luck out of wealth creation and instead develop smart strategies to get ahead. First you need to learn how to play the game, and then you need to know how to win the game.

Myth # 9:  To become rich you must diversify

Wrong!

Yet that’s what most financial planners suggest isn’t it?

Diversification leads to an average outcome.

I’ve found that successful investors don’t diversify -they cultivate the skills required to make better, smarter investing decisions and specialise in one niche.

Here’s what some experts say about diversification:

“Wide diversification is only required when investors do not understand what they are doing” Warren Buffett

“Many financial advisors recommend that you diversify for your own protection. What they fail to tell you is that it is also for their protection. Since most financial advisors cannot tell you exactly which stock or mutual fund is a great investment, they tell you to buy a bunch of them.” Robert Kiyosaki

Paying Off Your Mortgage EarlyMyth # 10: Paying off your house provides security

This is one of the old myths many of us learned from our parents, who probably learned it from their parents.

But it doesn’t make sense in the new financial era.

The problem here is that once you’ve paid off your house, you end up with idle equity sitting under your roof doing nothing; equity you could use as a deposit to buy an investment property and grow your wealth.

Myth # 11: All the good investments are taken

That’s not true – opportunities are always out there – in every market.

Sometimes there are a lot and sometimes there aren’t.

Some are obvious and others are opportunities you create by understanding investment markets.

Sure, all of yesterday’s deals have been taken, but tomorrow’s deals have not.

Someone will snap them up.

Why shouldn’t it be you?

But at this stage of the property cycle you’ll have to be very careful – the cycle has moved on – the winds have changed and you’ll have to set your sails differently.

If you want to know what to invest in and where in this new reality – the new normal (at least for a while) – please join me at my upcoming Property Market and Economic Updates that I’ll be conducting in 4 states in March and April this year

I will be presenting a heap of BRAND NEW content I haven’t discussed in public before.

So please click here nowand find out all the details and reserve your place.

I’ll be joined by Dr. Andrew Wilson, Australia’s leading property economist, Ken Raiss, Director of Metropole Wealth Advisory and local property experts, so please click here now and find out all the details and reserve your place.

Myth # 12:  If you want to do it right, you have to do it yourself Professional Advisors

There’s no such thing as a self made millionaire.

All successful property investors have a good team of professional advisors and supportive mentors around them.

That doesn’t mean you should hand over full responsibility for your wealth creation to others.

But the rich recognise that they can’t be an expert in all aspects of wealth creation, so they find a team of experts they can lead in order to help them achieve their goals.

Myth # 13:  I’ve done everything wrong! It’s too late

It’s never too late to learn how to invest or to overcome your mistakes.

There are many success stories of people who conquered all sorts of adversity, or started investing later in life and ended up achieving financial freedom.

In fact Ray Croc was over 50 years old when he built his very first fast food outlet.

You might have heard of it – it’s called McDonald’s.

Myth # 14: Debt is bad

Most Australians believe debt is a dirty word, but not all debt is bad.

Savvy property investors know how to use good debt to buy appreciating assets.

Myth # 15: It doesn’t matter what I want – I just can’t do it

Subscribing to this myth is almost a guarantee of failure, because our beliefs and perceptions become our reality.

Some people who’ve had a few failed attempts “learn” that wealth is beyond their control and they can’t affect the outcome.

They remain in a cycle of victimisation all their lives. Psychology Of Success 1

This is one of the reasons why the rich get richer – they believe they are in control of their destiny.

You must also believe you’re in control and act as if you’re in control.

Then pretty soon you’ll be surprised by the results you achieve. Invariably, the more success you have the more your thoughts about what you can and can’t control will alter for the better.

Yes – you can do it!

There’s no way money can know who’s in control of it, what their qualifications are, what ambitions they have or what they’re going to do with it.

Money is there to be used and spent, saved and invested. It can’t judge whether you’re worthy or not.

Now that you understand some of the myths that have held so many people back, the good news is you can do things differently.

Choose to change your beliefs to produce outrageous results and reach every goal you set.

Of course while property investing may be simple it’s not easy.

And that’s not a play on words.

Fact is, around 20% of those who get involved in property investment sell up in the first year and close to half sell their property in the first 5 years.

And of those investors who stay in property, about 90% never get past their second property.

So if you want financial freedom from property investment to fund your dreams, you’re going to have to do something different to what most property investors are doing.

You’re going to have to listen to different people to who most Australian property investors listen. Do Something Different

You’re going to need to set yourself some goals and follow a strategy that’s known, proven and trusted.

Then you grow your property investment businesses one property at a time.

Of course…you need to buy the right type of properties.

So why not join me and a group of property and tax experts at my upcoming Property Market and Economic Updates that I’ll be conducting in 4 states in March and April and find out how to succeed in property in this new, very different property market.

I will be presenting a heap of BRAND NEW content I haven’t discussed in public before.

I guarantee there will be several things I reveal that you are not doing and you should be!

Click here now to get more details and reserve your seat.

Property & Econonomic Update

If you want to cut through all of the media hype, and all the contradictory predictions, and finally learn the truth (good and bad) about what is going to happen to the Australian property markets, this seminar is exactly for you…

Click here now to get more details and reserve your seat.

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About

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


'Another 8 property investment myths' have 9 comments

  1. Avatar for Property Update

    March 15, 2018 Kevin Durston

    Hi Michael,
    I enjoy the insights provided from your daily email. Unfortunately I am unable to attend your up and coming property and economic update. Is there anyway I may be able to get access to it in the future?
    Cheers
    Kevin

    Reply

    • Avatar for Property Update

      March 15, 2018 Michael Yardney

      Kevin
      We will be recording the Melbourne semianr and selling the DVD’s – watch out on Property Update

      Reply

  2. Avatar for Property Update

    August 9, 2013 Stu

    Excellence from Michael Yardney as usual …. for those who will heed it!

    Reply

  3. Avatar for Property Update

    August 9, 2013 Stu

    Excellence, for those who will heed it …. as usual!

    Reply

  4. Avatar for Property Update

    August 9, 2013 Lindsay Kitching

    Hi Michael
    I notice you frequently refer to “Investment Grade Properties”. Can you please define what you mean by this. Is it possible to get into such properties that are not negatively geared. We have equity but no spare cashflow to subsidise a negatively geared property.
    Regards
    Lindsay

    Reply

    • Avatar for Property Update

      August 9, 2013 Michael Yardney

      Lindsay
      In my opinion an investment grade property is one that gives you above average capital growth as well as regular stable interest rates. And one that does not fluctuate greatly in price. A property that is strong and stable.
      This means you need to select the right locations and then the correct property in that location. I’ve found less than 5% of the properties we inspect in the good suburbs are “investment grade.”

      Reply

  5. Avatar for Property Update

    May 23, 2012 Bernie s

    Great info as always. I enjoy your articles.

    Reply

  6. Avatar for Property Update

    May 14, 2012 Gretta Francis

    Thanks Michael for being the myth buster. I enjoy reading your articles.

    Reply

  7. Avatar for Property Update

    May 11, 2012 Lorraine M

    Thanks Michael
    Another good motivational blog. You gave me some things to think about.

    Reply


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