Bayview, still doesnt change the fact that it isnt a great way to make money. Fluking some capital gains is good but can you replicate it over and over? The only way to reliably make money in re (even then not gaurantee) is to develop it. If you dont want to develop it then you either need to wait for it to go up or turbo charge the result with cash from the outside. Hence money makes money.
If what i am saying is bs where are all the low income earners who retired off their portfolios within a cycle or two?
I understand what you are saying - and you contradicted yourself a bit there - development is a form of moneymaking from property.
But with low income earners; all they need to do is start by buying something cheap, and start building from there.
Obviously it won't be a fast way to make money with that strategy, but it is a relatively sure and safe way to become financially comfortable after a decade or so.
Someone who has a plan from day one - which I never did - could smash it in a much smaller timeframe, and build up to a level of buying development sites etc much sooner.
The problem with the low income earner is most of them don't have a financial mindset anyway, and most of them throw their hands up and say things like "I'll never be rich", or "I'm hopeless with numbers", etc, and then there are those who don't care and live day to day. This is why so many of them never get ahead.
My 12 year old son earns nothing from any job. He is as low income as you can get. But, he does get pocket money, and has done since about 6 years old. He gets $1 for every year of life. He is up to $12 per week now.
Every single week we give him that money, and take back 20% of it, which we put into an ING account. He also earns more money around the house for extra chores such as hanging up/taking in the washing, etc.
He knows that this money is only ever to be spent on investing, and he already has more that $1,500 in his account (we have added a few dollars per week along the way).
I don't know of many low income earners who have that sort of money in any Bank, and certainly not a higher-interest account like ING, or Bankwest, etc.
He is now showing interest in all the shows we watch such as Grand Designs, GD Australia, My Dream Home (USA show) - my level of all the above started well into my 30's, and that is n't too late- even with mistakes.
Imagine what sort of wealth he can create with his foundation - even if he only ever stays on a paltry wage.