The worst & the best property advice I’ve been given

Recently one of my sons, who has taken a keen interest in property investment, asked:

“Dad – what’s the worst advice you’ve ever been given on real estate investing and what’s the best advice you could give me?”

The worst advice:

I explained that the worst real estate investment advice I was given was that property investment is easy.

This was clearly wrong because most property investors fail!The best advice you could give

Look at the facts – 50% of those who get into property investment sell up in the first 5 years and of those who keep their properties, the vast majority never ends up owning more than one or two properties.

This means they don’t ever achieve the financial independence they desired.

However over the years I found property investment is simple, but not easy.  And that’s not a play on words.

It’s simple if you follow a proven formula but it’s really hard to become wealthy in property if you do what everyone else is doing.

While many investors chase cash flow or the next hot spot, I’ve found successful investors build their asset base. 

Over the years I have developed a 5-stranded strategic approach to property investment that ensures the properties I buy a property will outperform the market averages.

  1. I buy the type of property that has wide apeal to owner occupiers (who make up the bulk of property purchasers) 
    property investors
  2. I buy a property below its intrinsic value. (So I don’t pay a premium for new or off the plan properties)
  3. In an area that has a long history of strong capital growth and one that will have strong future capital growth because of the demographics in the area ( rising disposable income or maybe gentrification.)
  4. I look for a property with a twist  – something unique or special or different or scarce about the it.
  5. And a property where I can “manufacture capital growth” through refurbishment renovations or redevelopment.

This means I minimise my risks and maximise my upside as each strand represents a way of making money from property and combining all five is a powerful way of putting the odds in my favour.

If one strand lets me down, I have two or three others supporting my property’s performance.

The best advice I’ve been given:

When I first became involved in property investment I didn’t understand the cyclical nature of the property market – my only experience was a rising property market.

An early mentor taught me to prepare for the lean times by having a cash flow reserve to see me through the down times of the property cycle or to handle unforeseen expenses. Eco.

Rather than use my full borrowing capacity and buy the most expensive property I could afford, I learned the concept of setting aside a buffer.

While I initially was concerned that I was not using my full borrowing capacity, having this safety net helped me get through the high interest rate period of the early 1990’s, while many other investors had to sell up their properties.

It’s a lesson I’ve never forgotten and has let me sleep peacefully at night through 5 property cycles.

Another piece of good advice – treat your property investments like a business

Over the years I’ve seen a small group of property investors, those who treat their investments like a business, become very, very rich by growing a multi-million dollar investment property portfolio.

They do this understanding “the system” and getting the right type of finance, setting up the correct ownership and asset protection structures and knowing how to legally use the taxation system to their advantage. Female Real Estate Agent Offer Home Ownership And Life Insurance To Young Couple.

Let’s face it; the majority of Australians will be always be employees but we all have the ability to become financially free by becoming property investors who treats their investments like a business.

And you can set up your own property investment business while you are still an employee or self-employed.

In fact that’s what I did and what almost every wealthy property investor I know has done.

They built their wealth by growing their real estate portfolio one property at a time.

While this was going on they lived off the income they earned from their day job.

They started off with one property, then leveraged off its capital growth to invest in another and another until one day they found themselves with a true property investment business.

One that gave them financial freedom and choices in their lives.

What’s the best or worst advice you’ve been given?

Please leave your comments below.

Here’s some extra advice I’d like to offer you…

If you’re interested in securing your financial future through property investment, now may be a good time to buy property – the property markets are moving before our eyes.  

what properties are investment grade

And if you’re looking for independent advice, no one can help you quite like the independent property investment strategists at Metropole.

Remember the multi award winning team of property investment strategists at Metropole have no properties to sell, so their advice is unbiased.

Whether you are a beginner or a seasoned property investor, we would love to help you formulate an investment strategy or do a review of your existing portfolio, and help you take your property investment to the next level. Please click here to organise a time for a chat. Or call us on 1300 20 30 30.

When you attend our offices you will receive a free copy of my latest 2 x DVD program Building Wealth through Property Investment in the new Economy valued at $49.

Just click on this link to find out more and reserve your place.


Subscribe & don’t miss a single episode of Michael Yardney’s podcast

Hear Michael & a select panel of guest experts discuss property investment, success & money related topics. Subscribe now, whether you're on an Apple or Android handset.

Need help listening to Michael Yardney’s podcast from your phone or tablet?

We have created easy to follow instructions for you whether you're on iPhone / iPad or an Android device.


Prefer to subscribe via email?

Join Michael Yardney's inner circle of daily subscribers and get into the head of Australia's best property investment advisor and a wide team of leading property researchers and commentators.

Michael Yardney


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

'The worst & the best property advice I’ve been given' have 22 comments

  1. Avatar

    December 6, 2017 Robert

    Hi Michael,
    Enjoy reading your books and blog.
    Best advice:
    1) Be patient and experience the property cycles to appreciate the fluctuations
    2) Not to pay off the home loan which has allowed refinancing and buying more properties
    3) Treat property investment like a business, keep records, and continue to read and learn
    4) Keep a cash flow buffer and offset account
    5) Restructure loans with different lenders, especially now with tighter lending rules
    6) Your Cash Machine idea
    Worst Advice:
    Buying off the plan. One of the properties was bought as a resale under the intrinsic value, so it was an exception, however the completion was delayed.


    • Michael Yardney

      December 6, 2017 Michael Yardney

      Thanks Robert – I like #1 – wealth is the transfer of money from the patient to the impatient


  2. Avatar

    December 5, 2017 Kate

    Hi Michael,

    We appreciate all of your advice and insight.

    Our worst piece of advice was to buy a property and plan to sell it in 3 years time. We quickly learnt that the market doesn’t often perform when you think it will.

    The best advice we were given was to focus on the land content of a property and buy in areas which will be in high demand for many years to come.


  3. Avatar

    February 22, 2015 Ben Loveday

    But Michael, property investment IS easy. All you have to do is define all the risks across acquisition, financing, marketing and operations. Then from this think up the mitigation strategies for every risk: the strategies forming the “property development plan”. Lastly you have to keep reassessing the risks and amending the plan (to suit the project) at intervals of time as the risks change.
    Come to think of it, it’s not that easy.


  4. Avatar

    February 22, 2015 Brad Croston

    Hey Michael,

    The worst advice I received, which I had paid a company for, was to buy apartments off the plan. Now I can appreciate that not all off the plan deals are bad but when the company sell most of them to investors in areas where apartments are popping up everywhere causing an over supply and they are smaller size apartments, it definitely effects potential rental returns (competition) and stuns capital growth. In saying all that the lessons have been invaluable and I am now on to bigger and better things. The key I believe is do your own due diligence, especially when someone is selling you something!
    Thank you


  5. Avatar

    May 5, 2013 Ray Searles

    Hi Michael,
    I’ve been following your blogs and news letters for quite a number of years now
    and the worst advice i was given was from a family member.He said why buy an investment
    property and get into debt again. Well now I have two properties and one currently being built
    from sub-dividing the second property. Thanks Michael for your advice through your blogs etc.
    Kind regards Ray


  6. Avatar

    May 4, 2013 Ben Bradey

    The best advice I have received is to ‘buy in areas where people with money will want to live in 10 years time’. This is somewhat similar to one aspect of Michael’s four-strand approach.


  7. Avatar

    May 3, 2013 Brian Matthews

    The worst advice I got was from myself. Back around 2003 we sold 2 properties I owned with my parents. We all figured they were moving toward retirement and we were up and coming and we had competing interests. By the time we paid all outgoings and income tax associated with selling, there was not much to show for it. Had we set a business plan for the properties, I suspect we could have waited a few years and leveraged to buy more. I did end up gearing into Paddington, Qld and still hold that property, which I am happy with.


    • Michael Yardney

      May 3, 2013 Michael Yardney

      Great lesson Brian
      Sure sometimes you need to sell because you bought a dud property, but in general property investment is for long term holding


  8. Avatar

    May 3, 2013 Ravi Renjen

    Hi Michael,
    Thanks for your blog and the good down-to-earth advice it contains. I have been bombarded by property spruikers promising instant gratification and immeasurable wealth ins the shortes period of time with little or no effort on my part and with hardly any capital. If it is too good to be true it probably is!
    My wife and I have been investing in property for the last fifteen years and it has been a slow uphill climb but the rewards have been good. Wealth creation does not occur overnight, unless one is fortunate to win the Lotto. The best advice that I have received, is, buy a property that you can afford in a good location with proven capital growth and things will be alright. We have used this time and again and look for potential in the property, and how we can improve it.
    Thanks again.


    • Michael Yardney

      May 3, 2013 Michael Yardney

      Thanks for this – it echos what we said above – there is no such thing as “get rich quick”


  9. Avatar

    May 3, 2013 George Parsons

    The worst advice I have been given was a referral to a realestate agent to manage my properties, a complete nightmare.


    • Michael Yardney

      May 3, 2013 Michael Yardney

      Most estate agents are good at selling properties, but I agree with you that it’s better to work with a dedicated property management company. They have a different focus


  10. Avatar

    May 3, 2013 Gina Knight

    Thanks for your great blog Michael
    I really appreciate your perspective.
    The best advice I’ve been given is that property is not a get rich quick scheme. wealth comes to those who wait.
    That means I don’t get carried away by all those ‘get rich quick” emails I get almost every day. You know.. be a millionaire by the end of the year, bypass the banks and all that


    • Michael Yardney

      May 3, 2013 Michael Yardney

      Thanks Gina
      Your comment reminds me of Warren Buffets great quote:
      “Wealth is the transfer of money from the impatient to the patient.”


      • Avatar

        May 3, 2013 Kammi Beuzeville

        Another great read Michael.
        The worst advice we have probably ever been given was to buy ‘off the plan’. All our other property investment decisions have been good ones.


        • Michael Yardney

          May 3, 2013 Michael Yardney

          Thanks Kammi
          You’re right – I’ve seen lots of investors loose a few years capital growth because they paid too much buying off the plan


      • Avatar

        May 3, 2013 Sherif GHobrial

        Onya Michael!

        I remember a great piece of advise you mentioned before “surround yourself with a team of professionals” this is now paying dividends.


Would you like to share your thoughts?

Your email address will not be published.