Well, lets give this a try..
After hearing a few of my freinds on here talking about my progress and asking to hear a more detail story i thought id spend a bit of time running through my progress to date.
I find it hard talking about myself as i dont want to sound like a w@anker.
For those who dont know me i am 23, live in sydney and have 9 IP's so far.
Why do i like property and what is my purpose? Well I hate working and as a child I was passionate about property. I come from a family who work too hard and are always under constant stress, and dont enjoy life. I set goals when i was younger and did my numbers on what it would take to retire by the age of 30 (realistically) and that is my goal. I use to think business and all different other ideas, but as we can see now the obvious and easiest busines is property. Why? because its a commoditity, it can be leveraged, and everyone needs shelter, + there can be minimal involvement as time goes on.
How do i do it? I use to be the biggest tight ar5e around, and never spent a cent... i saved good money and was blessed that i have a mental toughness to push myself forward. was anything handed too me? NO. I have bought every property as sole owner, never had any inheritances, the only thing i have been given is the freedom to live @ home in our family home with mum till now which she is rebuilding her life and has left me to maintain the home.
Have i sacrificed anything? yes and no, i have always been conservative with doodads in which i buy and do not waste my money. I have always had brand new cars which i have purchased in cash (no personal loans). I worked hard as a child aswell in family business and bought my first brand new car in year 12 cash, and now on to my 7th car. (reason for the cars is they are tax deductable + when you do the sums say you pay $30 for car new has full rego brakes tyres etc... in a year or 2 you need to spend 3k on rego, breaks, tyres, service, etc... i sell and not inccur that cost and buy another new one for lie 7k extra so only paying small premium to get new car). I have sacrificed a lot of time however doing renos and building on properties, and yes i did work two full time jobs one year to get extra $$ (before i decided to borrow for new purchases), i still take holidays every year, still go get pis5ed on weekends with mates (however when i did renos and built properties i didnt have time for that) and enjoy the other things people my age do.
What do i buy? How do i make it happen?
Well i like to buy in boundaries of cities, and the only city i have ventured is Sydney thus far. I use to only want houses with land, but realised strata properties had their good points too... I currently hold 4 houses, 1 duplex, 4 townhouses/units. 8 of these are out in western sydney and 1 is on central coast. What are my requirements for properties? well i buy stuff in which is 20%+ under current market value, with a yield which is close to neutral cashflow. The positives of strata properties is the OSR landtax is lower as it is chopped up between the other owners, they are generally newer and require less work, and genrally can command a better rent.
Do i pay with LOE or cash and how do i fund new purchases? I use cash for everything, i am very uncomfortable with LOE. I am negatived geared now for my properties around $800pw inc all council strats repairs PM fees, everything. I am blessed to have low living expenses, and nowdays a good job which pays good $ $80-100+pa, but bought first house on $30kpa just after my 18th birthday. For my previous purchases i belived pay down debt, and have cash for deposits, if i did that i wouldnt have got to where i am, is just be paying off my first. Now days its a fair bit harder to save for deposits so i buy property under value settle on it, and redraw top its true value with the 20-40k i get out i go and purchase more property so im recycling debt but have a fairly good LVR coz im buying under market value.
Why property/debt? well with a business they are more volitile, especially in today market 95% businesses are in the red and require manual labour. Because the gold standard was removed from the global monetary policy 30 years ago, we see inflation occouring which has always happend before but mainly in the past on a supply and demand basis, not on a currency basis, but over time debt becomes irrelivent thru inflation, and as long as the cashflow is supporting your debt the underlying asset will increase in real dollar terms. lets look @ this scenario... Mum and dad bought our family home 40 years ago for $13k, dad was probably earning $50 a week, bread was 10 cents, interest rates sky high, and petrol 5c a litre, etc... now the property would be worth $500k, wage would be $1000pw, and inerest rates are lower, and bread is worth $4 a loaf, and petrol worth $1.50 a litre. So as long as we have inflation property with debt will outperform in medium-long term. Now the house that was bought in 1970, would rent for $20k+ pa and the purchase price was $13k if that cost nothing to hold then and they bout 10 of them theyd be earning $4k per week, and have the whole portfolio paid off within 6 months. Property without debt doesnt appear as good investment.
Where to? Well i have a plan of being retired by 30, it is a hard goal to track because in last 6 months the world economy has changed forever, 7 years time is a long time. i do have many factors leaning towards me... (rental increases, interest rates falling, property booms heading towards me, and a massive chunk of centro shares, which may turn good by some chance and clear all my property debt) I plan to be holding around 20 properties by the age of 25.
Summing up, my father had massive heart ataack and died when i was 16, he was 62, and busted his ar5e for 40 years + to not enjoy his life as much as he could have. I wish to give myself the freedom of choice for myself and my family and am committed to my plans today. I wish to be so F*ckin bored i have to decide what to do... play on the jetski or g play golf? i wish to be married wih children, and drive the kids to school and pick them up every day, not put them in school care because i gota work 2 jobs to pay my PPOR. I am not after a ferrari with gold chains, but a lifestyle.
What will i do when i reach my goal or along the way? i odnt know i have planned goals, but they dont always plan out to the way they should... but i invisiage the freedom + travel+ nice luxuries i have been saving myself for, always wanted to be an actor, and educator (not the spruiker type).
I know to some this may sound like a pipe dream, its not, im passionate about this, i am doing it, and people can have their opinions about what i do, i will check in with them @ 30 and say hi at their work.
If there is anyother questions you may have feel free to ask im pretty open person. There lots which i cant think of @ present.
Cheers,
Nath.
After hearing a few of my freinds on here talking about my progress and asking to hear a more detail story i thought id spend a bit of time running through my progress to date.
I find it hard talking about myself as i dont want to sound like a w@anker.
For those who dont know me i am 23, live in sydney and have 9 IP's so far.
Why do i like property and what is my purpose? Well I hate working and as a child I was passionate about property. I come from a family who work too hard and are always under constant stress, and dont enjoy life. I set goals when i was younger and did my numbers on what it would take to retire by the age of 30 (realistically) and that is my goal. I use to think business and all different other ideas, but as we can see now the obvious and easiest busines is property. Why? because its a commoditity, it can be leveraged, and everyone needs shelter, + there can be minimal involvement as time goes on.
How do i do it? I use to be the biggest tight ar5e around, and never spent a cent... i saved good money and was blessed that i have a mental toughness to push myself forward. was anything handed too me? NO. I have bought every property as sole owner, never had any inheritances, the only thing i have been given is the freedom to live @ home in our family home with mum till now which she is rebuilding her life and has left me to maintain the home.
Have i sacrificed anything? yes and no, i have always been conservative with doodads in which i buy and do not waste my money. I have always had brand new cars which i have purchased in cash (no personal loans). I worked hard as a child aswell in family business and bought my first brand new car in year 12 cash, and now on to my 7th car. (reason for the cars is they are tax deductable + when you do the sums say you pay $30 for car new has full rego brakes tyres etc... in a year or 2 you need to spend 3k on rego, breaks, tyres, service, etc... i sell and not inccur that cost and buy another new one for lie 7k extra so only paying small premium to get new car). I have sacrificed a lot of time however doing renos and building on properties, and yes i did work two full time jobs one year to get extra $$ (before i decided to borrow for new purchases), i still take holidays every year, still go get pis5ed on weekends with mates (however when i did renos and built properties i didnt have time for that) and enjoy the other things people my age do.
What do i buy? How do i make it happen?
Well i like to buy in boundaries of cities, and the only city i have ventured is Sydney thus far. I use to only want houses with land, but realised strata properties had their good points too... I currently hold 4 houses, 1 duplex, 4 townhouses/units. 8 of these are out in western sydney and 1 is on central coast. What are my requirements for properties? well i buy stuff in which is 20%+ under current market value, with a yield which is close to neutral cashflow. The positives of strata properties is the OSR landtax is lower as it is chopped up between the other owners, they are generally newer and require less work, and genrally can command a better rent.
Do i pay with LOE or cash and how do i fund new purchases? I use cash for everything, i am very uncomfortable with LOE. I am negatived geared now for my properties around $800pw inc all council strats repairs PM fees, everything. I am blessed to have low living expenses, and nowdays a good job which pays good $ $80-100+pa, but bought first house on $30kpa just after my 18th birthday. For my previous purchases i belived pay down debt, and have cash for deposits, if i did that i wouldnt have got to where i am, is just be paying off my first. Now days its a fair bit harder to save for deposits so i buy property under value settle on it, and redraw top its true value with the 20-40k i get out i go and purchase more property so im recycling debt but have a fairly good LVR coz im buying under market value.
Why property/debt? well with a business they are more volitile, especially in today market 95% businesses are in the red and require manual labour. Because the gold standard was removed from the global monetary policy 30 years ago, we see inflation occouring which has always happend before but mainly in the past on a supply and demand basis, not on a currency basis, but over time debt becomes irrelivent thru inflation, and as long as the cashflow is supporting your debt the underlying asset will increase in real dollar terms. lets look @ this scenario... Mum and dad bought our family home 40 years ago for $13k, dad was probably earning $50 a week, bread was 10 cents, interest rates sky high, and petrol 5c a litre, etc... now the property would be worth $500k, wage would be $1000pw, and inerest rates are lower, and bread is worth $4 a loaf, and petrol worth $1.50 a litre. So as long as we have inflation property with debt will outperform in medium-long term. Now the house that was bought in 1970, would rent for $20k+ pa and the purchase price was $13k if that cost nothing to hold then and they bout 10 of them theyd be earning $4k per week, and have the whole portfolio paid off within 6 months. Property without debt doesnt appear as good investment.
Where to? Well i have a plan of being retired by 30, it is a hard goal to track because in last 6 months the world economy has changed forever, 7 years time is a long time. i do have many factors leaning towards me... (rental increases, interest rates falling, property booms heading towards me, and a massive chunk of centro shares, which may turn good by some chance and clear all my property debt) I plan to be holding around 20 properties by the age of 25.
Summing up, my father had massive heart ataack and died when i was 16, he was 62, and busted his ar5e for 40 years + to not enjoy his life as much as he could have. I wish to give myself the freedom of choice for myself and my family and am committed to my plans today. I wish to be so F*ckin bored i have to decide what to do... play on the jetski or g play golf? i wish to be married wih children, and drive the kids to school and pick them up every day, not put them in school care because i gota work 2 jobs to pay my PPOR. I am not after a ferrari with gold chains, but a lifestyle.
What will i do when i reach my goal or along the way? i odnt know i have planned goals, but they dont always plan out to the way they should... but i invisiage the freedom + travel+ nice luxuries i have been saving myself for, always wanted to be an actor, and educator (not the spruiker type).
I know to some this may sound like a pipe dream, its not, im passionate about this, i am doing it, and people can have their opinions about what i do, i will check in with them @ 30 and say hi at their work.
If there is anyother questions you may have feel free to ask im pretty open person. There lots which i cant think of @ present.
Cheers,
Nath.
