I feel humble

[MathBoy]

Geez... I'm really not sure what to say.

I can tell the real investors from the others quite easily here, I'm just not sure why these people are hanging around a forum dictated toward wealth when it's clear they have no idea how to achieve the mindset, let alone wealth itself.

Y-man I have respected for many years, as well as Wylie and conservative Alex, but these other newcomers just sound ridiculous. It's really no wonder the greats are all but gone. One PPOR and a small IP is really playschool kinda stuff people, and if you think this is a huge risk then I'm sorry but there really is no hope for you in this department, especially with the wealth of knowledge available here. This is what differentiates my good friend from yourselves. Please just try to think about that

Everyone else has more than covered the risk and conflict of interest issues so i don’t need to say more than that I’m in agreement with Hobo-jo, weg & sanj.

If I was one of the people you referred to as "hanging around a forum dictated toward wealth when it's clear they have no idea how to achieve the mindset, let alone wealth itself", then I have to say this:

I buy precious metals and rare earth minerals based on current and future use in technology and production numbers.

I currently hold cash in 6 different types of currency.

At times I have had large amounts of stock, I have played on both sides of the market.

Do not assume I know nothing about investing just because I do not own property.

 

[The Fence]

Hey Mathboy...did you have youir chest puffed out when saying that...??

You guys are just as bad as you say the investors on here are when attacking someone's point of view...give it up and go play on your gold PM currency forums please.

 

[MathBoy]

Hey Mathboy...did you have youir chest puffed out when saying that...??

You guys are just as bad as you say the investors on here are when attacking someone's point of view...give it up and go play on your gold PM currency forums please.

Yes I did. =P

I keep a close eye on the property market and this place is just one way I can get another view of it. If I just hung around on the other forums I may miss valuable information here. I may have only just started posting but I have been lurking since 2007 if not before so I was fully expecting these types of reactions by becoming an active member.

But I'm not just looking for cries of pain and signs of crash’s, I’m also looking out for any hints of a turn around. I will freely admit I underestimated effect the FHOB would have when it first come out and wish to avoid that again.

 

[wobbycarly]

Interesting bunch of reactions.

Investor2009, I know how you feel when you can see the positive result of helping someone else take action. I've seen that myself with colleagues, (well one in particular) but I can also see the point of view of ensuring that one is better to "teach a man to fish" than simply "give him a meal". (Apologies for mangling the metaphor, but you get the point.)

In fact, just yesterday I had lunch with a differnt (ex-)colleague who specifically wanted to ask me about "investment". I was very clear that I could not provide "advice", but that I was more than happy to share my own experiences. I deliberately did not ask about his current situation, but instead prompted him to ask himself what he was trying to achieve, and then determine the vehicle that was best suited to his goals (thanks Rixter!!).

When we are enthusiastic about our own investing, it can be easy to become evangelical (for want of a better word) and infuse others with the same enthusiasm. Others may see our results, and think it came easy, and attempt to emulate without being aware of the risks, pitfalls, costs (emotional, physical, financial) that come as second nature to an investor who's been at it for a while.

So I applaud investor2009 for "spreading the word" but would also have concern for his/her "convert", as they may still be in the heady days of finding this new "way of life" and it may all come crashing down if things get too hard. But I hope not.

 

[investor2009]

I stand by what I said and did 100% and don't just think I've done the right thing. I know I have.

I was thinking last night that the way I worded things, it sounds like Grae (my good mate) is a total tard. He's a very intelligent person, and has always been a hard worker and had a very steady job, The same one for a good mate of his for the past 18 years as a matter of fact.

It's just funny he cannot read or write well and he does not need to either because he gets along just fine without it. My point was, even those who cannot read and write can still be super successful. Which Grae not only will be, but already is.

I told him that he can speak with me any time he wants about anything investment orientated. We've spoken about a plan and he totally gets it and is very motivated. He's not a tard.. He dealt with only my most trusted contacts and I have 100% faith in them also.

The way I see it, you guys really are amateurs, apart from Jase whom I've known (here on SS) for many years. Good luck because you will need it.

Bye,

 

[battler]

55yo illiterate newbie investor, has been told all he needs to understand is the maths and to sign a few docs (even though he can't even read the docs he's signing ).

If he has rejected your investment books because he can't read, how does he understanding yield, effects of interest rate hikes (wants 2 IP's), tax, buffers, structuring loans

It was said that this person couldn't read or write, I don't believe it was said that he was deaf or dumb, so who says he can't understand the complexities of what is required?

 

[luckyone]

For what it's worth investor, I think you did the right thing. Sounds like you gave him the opportunity he needed to get started. Just sounds like he's been more lazy than anything else in the past.

 

[sanj]

I stand by what I said and did 100% and don't just think I've done the right thing. I know I have.

I was thinking last night that the way I worded things, it sounds like Grae (my good mate) is a total tard. He's a very intelligent person, and has always been a hard worker and had a very steady job, The same one for a good mate of his for the past 18 years as a matter of fact.

It's just funny he cannot read or write well and he does not need to either because he gets along just fine without it. My point was, even those who cannot read and write can still be super successful. Which Grae not only will be, but already is.

I told him that he can speak with me any time he wants about anything investment orientated. We've spoken about a plan and he totally gets it and is very motivated. He's not a tard.. He dealt with only my most trusted contacts and I have 100% faith in them also.

The way I see it, you guys really are amateurs, apart from Jase whom I've known (here on SS) for many years. Good luck because you will need it.

Bye,

there is no need to start crying or making anything personal. YOU started a thread, people commented in it with their views on the subject. is this not what a forum is all about?

if you dont want people commenting on a topic maybe, just maybe, it might be an idea not to start said topic

anyway, i wish you and your friend the best but if you genuinely feel that anyone who disagrees with your admittedly inexperienced view is an amateur then i must say it might be a case of the blind leading the blind with your friend.

 

[weg]

It was said that this person couldn't read or write, I don't believe it was said that he was deaf or dumb, so who says he can't understand the complexities of what is required?

I don't believe I said he was deaf and dumb.

He would however need some knowledge to work out those complexities (understand).

Investor2009 told him he didn't need to understand much (bad advice), he's illiterate (can't easily research like we can here), he's 55yo (can't afford to take his time gaining knowledge/understanding) and I assume lacks 'tools' (some sort of past experience/business knowledge/previous investment knowledge) from what has been said.

My only real criticism btw, is that this man needed better advice - inspiring people to invest is a good thing but the risks should have been pointed out. Do the maths and sign the docs... I don't think so.

 

[sanj]

My only real criticism btw, is that this man needed better advise - inspiring people to invest is a good thing but the risks should have been pointed out. Do the maths and sign the docs... I don't think so.

my thoughts exactly!!

 

[jaycee]

there is no need to start crying or making anything personal. YOU started a thread, people commented in it with their views on the subject. is this not what a forum is all about?

if you dont want people commenting on a topic maybe, just maybe, it might be an idea not to start said topic

anyway, i wish you and your friend the best but if you genuinely feel that anyone who disagrees with your admittedly inexperienced view is an amateur then i must say it might be a case of the blind leading the blind with your friend.

The bolded bit almost made me laugh,
I'm sure investor2009 is aware of the same rissks and perhaps he feels doubtful that he would deliberately or naively con a mate into doing something without considering the risks... whatadaya reckon ?

Just saying.........

I think his comments about amateurs was INSTEOR2009's way of "defending" hmself against what he felt were "accustations" (quotes on purpose)..

anyway, wecould keep going in circles al lnight about who is more right for ages....

 

[BayView]

I was gunna add a similar type of feelgood result to the thread, but then I started reading the replies.

Congratulations all on taking a freely offered feel-good story and totally stuffing up the entire thread by picking shid out of the poor b@stard.

FFS.

 

[skater]

Slightly lower than my REA friend told me I'd achieve realistically. So I lost the $40k, I don't expect any more decline and believe I've sold in the lowest slump. My loss, although I still gained and he has purchased at a fantastic point in the cycle. Win/Win

.

From the sounds of it, Investor has sold this property at a little less than market value. On the face of this, it could be a good stepping stone for his friend. A much better one, in fact, than many newbies who naively jump in and pay full list price on their first 'investment'. Something with a little equity build in, so that if he decided to sell, he won't lose out. If this is the case, I take my hat off to you. Good work!

The risks pointed out are very real - 55yo illiterate newbie investor, has been told all he needs to understand is the maths and to sign a few docs (even though he can't even read the docs he's signing ).

If he has rejected your investment books because he can't read, how does he understanding yield, effects of interest rate hikes (wants 2 IP's), tax, buffers, structuring loans, how long can he hold if he loses his job? can he easily get another at his age? What if he get s sick? can he hold and for how long? what is his plan?

Many of these thing most of us learn along the way, but this guy being 55 and unable to read and write probably hasn't got much room for error, yet may be at bigger risk that the average newbie.

.

Lets go back for a second and think about the first investment that all the experienced investors on the forum made, and honestly ask yourselves if you knew all the risks and could answer the above questions? I know I couldn't, and I was super careful (or so I thought at the time).

This is what I did, and I know that there are a heck of a lot of you that were more conservative, as well as those that weren't:

We were paying down our PPOR as quickly as we could when we had someone come and tell us about these new 'you beaut' LOC's that had just been brought out and how we could even buy an investment property using one. I did research, and found that we didn't need the expensive package that they were offering and went out & bought our first IP.

Until then, we had no idea that ordinary people like us could do that. We had NO idea what we were doing, just jumped straight in, after a bit of research that proved that the information we had been fed was correct. We had no idea about risks, structuring, tax or many other things that we take for granted these days. In fact, I'd say that we probably knew less than the average newbie these days, because we couldn't jump online. Everything we learnt, we learnt the hard way.

But you know what, we learnt, we survived, and we grew from there. Just knowing that we owned a second property made us feel that we were rich beyond belief.

Being illiterate does not make one stupid. There are plenty of people out there that don't have a good grasp of the written language, and some of them own investments and run successful businesses. Of course, being illiterate does make it a little more complicated for Investors' friend, but I'm sure they both are aware of this.

Investor, if this was my friend I would be super conservative with him - he's a friend after all, and you don't want him to feel that he's been fed wrong advice, should he get it wrong - and suggest that he let this property settle in before he decides to buy more. You know, you might have opened a whole new world for him that he didn't know existed, and (like me) he didn't realise that ordinary people are able to do this.

Introduce him to others, maybe at an investment gathering near you, so that he is not just getting feedback from you. You could be a super investor, but, heck, you might not either. Or you could just make mistakes, we all do that. Oh, and if he does have some reading skills, try him out on some really simple stuff. "The richest man in Babylon" comes to mind. This is a very short book, quite childlike and easy to understand. More of a storybook than a complicated investment book. Get it yourself, read it, and if it is too hard for your friend, then maybe read a chapter at a time with him. His reading problems might be dyslexia that was not diagnosed at school, so maybe you can work with him in this regard, but be careful that you don't offend him either if you do discuss this, it might be a touchy subject.

Good luck with your friend.

 

[wylie]

Skater... that post was pretty much how I felt when I read the original post. Forum will not allow me to give you more kudos this morning though. I was surprised at some of the negative posts, but understand that without knowing the relationship, conversations and warnings that investor has more than likely had with this chap, that judging on just a couple of paragraphs is a bit tough. We all read the same things, and it is amazing at the different interpretations that can be drawn by different personalities and from those with different experiences of the property "game".

It sounded like investor2009 was trying to help, and I would have done the same thing, I believe.

I know that I did a similar thing about ten years ago when I gave a friend and her husband enough information about what we had done to give her the courage to stop paying rent and buy a place of their own. They assumed they would never afford a house. Once I showed them how to buy, they got in and bought. She has thanked me several times because the house they bought for $200K doubled over the next few years and she is well on the way to owning it.

Had it turned to custard for her, she could have blamed me, but perhaps she would have taken ownership for her own actions. However, it worked for this couple because I didn't force them to buy, I simply showed them how it was possible, when they had no idea it was possible.

I copped a little flak on here for partly guaranteeing our son's unit purchase when he had no "visible" savings. Most people were positive and understood, but some (mostly the trolls who seem to have disappeared now) were full of bile for "pushing our son into a debt he cannot possibly service".

Seven months in, he is proud of his transformed dog-box of a unit. It looks amazing and he is on his way to financial freedom. It will take years, but you have to start somewhere.

Perhaps investor2009 could ensure that his friend takes things slowly, gets comfortable and ensures he has income insurance and other things in place to protect any downside. There are risks in everything, and I'm sure further discussions will be taking place with this chap. It's good to know the risks of rushing in, and then he can make his own decisions.

 

[skater]

There are risks in everything, and I'm sure further discussions will be taking place with this chap. It's good to know the risks of rushing in, and then he can make his own decisions.

That is very true.

I believe that the best way of learning about something is to sometimes just 'jump in'. If you sit around forever analysing things you may become a victim of analysis paralysis. Sometimes the biggest risk of all is inaction.

As a newbie, most of us have had to, at some stage, take a leap of faith, especially those of us who started without easy access to the internet. We all started out with that first IP. It was scarey and exciting at the same time. Some of us knew what it was we were getting into, but most of us learnt as we went.

I feel Investor's friend is lucky that he has someone to 'hold his hand' so to speak. I had nobody to talk to at all, and would have dearly loved to have had that.

 

[weg]

But you know what, we learnt, we survived, and we grew from there. Just knowing that we owned a second property made us feel that we were rich beyond belief.

skater, the BIG difference here is you could survive because you had time on your side, and you've had a long bull run in property prices. You could have afforded a problem/setback/loss and bounced back.

This guy certainly hasn't got age on his side, and may very well not have the bull run in property that you would have experienced (well not for a long long time). As a friend I would have wanted him to know that and not feel responsible if it all turned to custard .

Multiple IP's, a bear market, a mistake or two and having to sell/gets tired of property and sells (eg. because it hasn't gone up in price for a few years), and he could easily be in a far worse position at retirement, than if he didn't do anything.

 

[skater]

skater, the BIG difference here is you could survive because you had time on your side, and you've had a long bull run in property prices. You could have afforded a problem/setback/loss and bounced back.

With all due respect, you have no idea at all what our early years were like. Sure, we have had a nice bull run, but that is not the beginning of the story, and stories should always start at the beginning.

This guy certainly hasn't got age on his side, and may very well not have the bull run in property that you would have experienced (well not for a long long time). As a friend I would have wanted him to know that and not feel responsible if it all turned to custard .

No, this guy hasn't got age on his side, but I can probably guess that he is in a much, much better place financially than we were with our first purchase. Not having an expensive mortgage on your PPOR helps a lot. His home is probably reasonably comfortable unlike the starter home in much need of a little TLC (Real Estate speak here, it was best pulled down and makes the Housing Commission purchases look nice). He's probably got his house funished with reasonable furniture instead of the threadbare hand-me-downs that we had. He probably drives a modern car, unlike the 20yr old ones we had at the time.

As I mentioned previously, our incomes were miniscule. We weren't planning on buying another property, we just happened upon some information that told us we could and went for it. At the time, we were trying to upgrade our home as best we could.

Multiple IP's, a bear market, a mistake or two and having to sell/gets tired of property and sells (eg. because it hasn't gone up in price for a few years), and he could easily be in a far worse position at retirement, than if he didn't do anything.

Actually it was some time after buying that first IP that we had prices increase. The first small increase in price was only due to a reno that we did.

It was certainly many years later that we bought multiple IPs and had a nice run on prices.

We were niave, and just toughed it out whenever we had to. At the time we bought that first one, we were well under the average income. Being self employed we had to jump many, many hurdles to get finance, and it wasn't until years later, with hindsight, that we realised that the only reason they gave us the money was because we had so much equity in our PPOR. We were very hard up for money at the time, and only just hung on by the skin of our teeth. We could very, very easily gone to the wall.

In all honesty, yes, the friend could be in a worse position at retirement, but he could also be in a much, much better position.

You also are jumping to conclusions here as to what this property is. We don't know how much it cost, how much it is worth, what the rental income is, what the demand for rental is in the area, the purchasers income, his own mortgage repayments, his expenses, his risk profile etc.

For all you know, it might be cashflow positive or it could cost thousands of dollars each year to hold. The purchaser could have a completely paid off PPOR, be earning $100kpa and this property might only be costing him $20pw out of pocket.

Like I said in the previous post, this friend is lucky to have someone he knows that is willing to "hold his hand". Hopefully Investor is wise enough to introduce him to others so that he is getting feedback from more than one sourse, but I think he will do that anyway.

 

[weg]

With all due respect, you have no idea at all what our early years were like. Sure, we have had a nice bull run, but that is not the beginning of the story, and stories should always start at the beginning.

I didn't think I insinuated that I knew what your earlier years were like - how whould I know? Only thing I insinuated was your age - and you can't be 90yo because you have teenage/young adult children.

No, this guy hasn't got age on his side, but I can probably guess that he is in a much, much better place financially than we were with our first purchase. Not having an expensive mortgage on your PPOR helps a lot. His home is probably reasonably comfortable unlike the starter home in much need of a little TLC (Real Estate speak here, it was best pulled down and makes the Housing Commission purchases look nice). He's probably got his house funished with reasonable furniture instead of the threadbare hand-me-downs that we had. He probably drives a modern car, unlike the 20yr old ones we had at the time.

As I mentioned previously, our incomes were miniscule. We weren't planning on buying another property, we just happened upon some information that told us we could and went for it. At the time, we were trying to upgrade our home as best we could.

Actually it was some time after buying that first IP that we had prices increase. The first small increase in price was only due to a reno that we did.

It was certainly many years later that we bought multiple IPs and had a nice run on prices.

We were niave, and just toughed it out whenever we had to. At the time we bought that first one, we were well under the average income. Being self employed we had to jump many, many hurdles to get finance, and it wasn't until years later, with hindsight, that we realised that the only reason they gave us the money was because we had so much equity in our PPOR. We were very hard up for money at the time, and only just hung on by the skin of our teeth. We could very, very easily gone to the wall.

In all honesty, yes, the friend could be in a worse position at retirement, but he could also be in a much, much better position.

You also are jumping to conclusions here as to what this property is. We don't know how much it cost, how much it is worth, what the rental income is, what the demand for rental is in the area, the purchasers income, his own mortgage repayments, his expenses, his risk profile etc.

For all you know, it might be cashflow positive or it could cost thousands of dollars each year to hold. The purchaser could have a completely paid off PPOR, be earning $100kpa and this property might only be costing him $20pw out of pocket.

None of your experiences change the fact that age isn't on his side when starting out .

Like I said in the previous post, this friend is lucky to have someone he knows that is willing to "hold his hand". Hopefully Investor is wise enough to introduce him to others so that he is getting feedback from more than one sourse, but I think he will do that anyway.

It depends what 'holding his hand' means - so far it hasn't included making him aware of any risks involving as part of IP investing.

skater, not only am I all for helping someone on the road to investing, I've done it. I've also stepping in and warned others from taking advice from a particular person too, ie. unrealistic, bordering on grandiose, IP investor at work who is now bankrupt (lost everything after having all the time in the world on her side).

I'm simply a believer that newbies should be directed towards being educated a bit before jumping in, but so be it if we don't all agree.

 

[skater]

It depends what 'holding his hand' means - so far it hasn't included making him aware of any risks involving as part of IP investing.
How do you know that Investor hasn't made him aware of this?

I'm simply a believer that newbies should be directed towards being educated a bit before jumping in, but so be it if we don't all agree.

It sounds like, from what I have read, that you believe that Investor is inexperienced. I've gone back and read his posts and it does say that he was inexperienced in selling a property, but I know many people that have bought multiple properties and never sold, so that really is irrelevant.

I also know successful investors that have started at a similar age, so that is irrelevant too.

Fact is, that no matter the age, some investors will only ever buy one IP. Some of those will sell up again within a short time span, others will hold on for a few years before selling, others will keep it, but not buy more than one, some others will go on and build a portfolio. Unfortunately some will also lose everything along the way through ignorance, stupidity, or unplanned market forces.

 

[weg]

It sounds like, from what I have read, that you believe that Investor is inexperienced. I've gone back and read his posts and it does say that he was inexperienced in selling a property, but I know many people that have bought multiple properties and never sold, so that really is irrelevant.

I also know successful investors that have started at a similar age, so that is irrelevant too.

Fact is, that no matter the age, some investors will only ever buy one IP. Some of those will sell up again within a short time span, others will hold on for a few years before selling, others will keep it, but not buy more than one, some others will go on and build a portfolio. Unfortunately some will also lose everything along the way through ignorance, stupidity, or unplanned market forces.

skater, have you actually read anything I've written .

I'm not sure what the point is you're trying to push, or why my view is unsettling you so much.

It's irrelevent whether I think investor2009 is inexperienced or not, when I don't really know him (I based my reponse on my interpretation of what he posted), your personal investment journey, investors habits regardless of age, etc, etc.

Bottom line is unlike you I think we have a responsibility when leading someone to investing, and I don't agree in ONLY talking PI up when there are downsides, the biggest ones in this case IMO being the current state of the property market and world economy (I know D & G) and his age combined with inexperience.

Geez, I'm starting to feel like a broken record.

Off to see the Masterchef Grand Final now.

Go Michael.