How would you reply to this statement?

H

Hodge

Showed my new IP to a mate today. Run down weatherboard house that needs renovations, large block, 10 mins to the CBD and desirable suburb in Melbourne. Purchased for $600K

Mate saw the house today, (is also on the market for an IP), looked at me with disbelief and said "for the money you spent I could have purchased a mansion in Taylors lakes."

I didn't know how to kindly tell him too F off!

What would you have said in this situation?
 
He's your mate, not the Queen. You could have told him to **** off.

Although just because he can't see things the same way you do, doesn't mean he meant any harm in what he said. Don't invite him round next time and keep working at your goals.

I would have most likely shrugged my shoulders and made mental notes of extra things throughout the house that needed to be done or could be improved upon.
 
Just can't see past new vs potential. If you spend $50k on reno works you will achieve a massive uplift in rent, instead he feels better if he pays his $50k extra in stamp duty, developer's margins and wasted time travelling greater distances to work and facilities.
 
Hodge said:
Showed my new IP to a mate today. Run down weatherboard house that needs renovations, large block, 10 mins to the CBD and desirable suburb in Melbourne. Purchased for $600K

Mate saw the house today, (is also on the market for an IP), looked at me with disbelief and said "for the money you spent I could have purchased a mansion in Taylors lakes."

I didn't know how to kindly tell him too F off!

What would you have said in this situation?
Click to expand...


People, mates, say stuff like that all the time.

He's also number crunching if he's looking for an IP, so no need to say FO when you can give him the 'numbers' and show him why yours a good deal. He probably genuinely can't see that it is.

Many, understandably, could think a property like that would be expensive to hold even with low interest rates and think other locations better for an IP.

If Taylors Lake is a crap investment then as an experienced investor explain to him why you think it's so and save your mate from making a mistake.
 
Ah! A statement based on the ol' subliminally calculated "if I was you" mentality (which I don't like much because if he was you he would've done what you did).

He is viewing the decision based on HIS reasons and concluding whether it was good or bad. He probably just doesn't understand your reasoning for your purchase - did you tell him your logic? Likewise - you probably don't understand his reasoning for his comment. Perhaps you could ask him why he said that?

I recommend considering what his reasoning is, within the context of your greater goals.
 
Mates and even family members of mine made similar comments about the cheap rundown apartments I use to buy, renovate and rent. Their mindset is stuck on purchasing one house you live in forever, paying off the debt as quickly as possible. Nothing wrong with that, however what I was doing was so different that it didn't make sense to them. Seven years later they now see what I was planning all along, even though they still don't fully understand it. Near zero vacancy rates; took advantage of drawing equity out to expand the portfolio before prices dropped due to the GFC; rents slowly bumped up whenever possible.

Your job now is to prove them wrong... in a good way. =)
 
the majority of unsophisticates are visuospatial in thought.
it takes a leap in abstractionist thinking to see the world via a spreadsheet.

i wouldn't bother educating him, unless he married my sister.
in fact, I honestly doubt he'll still be a close friend in 20 years.
he's not on the same journey.
 
Sylvester said:
the majority of unsophisticates are visuospatial in thought.
it takes a leap in abstractionist thinking to see the world via a spreadsheet.

i wouldn't bother educating him, unless he married my sister.
in fact, I honestly doubt he'll still be a close friend in 20 years.
he's not on the same journey.
Click to expand...


What if he's a great guy otherwise... you know the type, good fun to be around, loyal, there when life suddenly goes topsy turvy?

Don't those qualities count for anything?
 
Hodge said:
What would you have said in this situation?
Click to expand...

Ok seriously now, what could/should you say?

IMHO

Explain/articulate your logic:

$600k where you bought, rent expect $X, cap gain expected (based on history? How many years?), vacancy expected etc,

$600k in Taylor's Lakes, rent expected, cap gain expected, vacacny, etc.

Again, who knows, TL may turn out better!

Or what if your friend bought 2 of these
http://www.realestate.com.au/property-house-vic-taylors+lakes-114873675

The Y-man
 
I wouldn't take it too seriously. I would've said "mate I wish you would have told me that before I bought this old heap" and laughed. If he says what do you mean then explain your reasons and numbers for your purchase over the Taylors lakes option. Otherwise leave it at that, and if you're still in contact in 10years, show him what your place is worth vs a Taylors lakes mansion
 
Does it matter? Sounds like he didn't articulate himself well, from your post, sounds like he means well and he's there to follow up the conversation.

"for the money you spent I could have purchased a mansion in Taylors lakes."
Click to expand...

This is just a statement, and he's right. Doesn't make the mansion a better investment. It's like saying the money I paid for a one bedder in Sydney can buy a big house in Central Coast plus a luxury car, which is correct. Doesn't mean that I'll do it that way.

Who knows though, he might have said it in a belittling and jerk-ish way.
 
I'd simply shrug and decide that it's not worth discussing investment strategy this person.

You don't need to justify or explain a thing to anyone.
 
Simple

I know that , but I don't want one , this has more potential and that's what I wanted . .this will make me more money in the long term .

Short , to the point . Gives him something to think about .

Cliff
 
Hodge said:
Showed my new IP to a mate today. Run down weatherboard house that needs renovations, large block, 10 mins to the CBD and desirable suburb in Melbourne. Purchased for $600K

Mate saw the house today, (is also on the market for an IP), looked at me with disbelief and said "for the money you spent I could have purchased a mansion in Taylors lakes."

I didn't know how to kindly tell him too F off!

What would you have said in this situation?
Click to expand...

Two suggested responses:

"Where's Taylor's Lakes?"

"I don't think there are any mansions in Taylor's Lakes"
 
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