Some people are making it harder...

[Invest]

Friends and family only want what is good for you and the reason so many are against investing in property is that they don't understand it.

Many years ago I had a conversation with one of my Sister-in-law's. It went something like this.

Me: We've just bought an IP.
Her: Congratulations! It's great to see you getting ahead.

Next meeting.

Me: We've just bought an IP.
Her: So soon? Don't get over your head.

Next meeting.

Me: We've just bought an IP.
Her: Another? Should you really have so much debt.

Next meeting.

Me: We've just bought an IP
Her: How many properties can you live in? Why on earth do you need so many? You're just greedy.

We don't speak about our properties to any of the relatives now. They know we have them, but they don't know any of the details or how many we have. We found that all of a sudden we went from just another struggling family member to the "rich uncaring landlord" and a lot was expected from us because we were now "rich" despite our personal situation not changing.

Some of the neices and nephews, now that they are getting older, have asked a few questions from time to time, and we have always been open and honest with them, but unless asked we do not discuss the subject at all.

Hubby also has an older brother with just one IP. I don't think they will ever have more than the one as they only purchased this when they had finished paying down their PPOR and now they are working on paying this down. Having more seems to be too much risk for them, and that is fine. We all have to sleep at night. His wife is a bit of a softie for the tenant too, and feels guilty when putting the rent up, so their tenant is paying a lot under market value.

Yeah I guess this your OUR reality and for people to share the same vision, they need to emerse their head in this before making judgements.

People often like to point and say things when they dont know the schematics behind things.

Thats why financial mentors are usually not your best friends or close family... but usually what they state is true.

I think I better just shut up about my financial life as I tend to have a big mouth that can get me into trouble, loose lips sink ships.

 

[Invest]

Lady at work asked me "how many properties DO you have?

What happens if you lose your job? I said nothing, we can live on my husbands as the properties cost us little to keep.
What if you BOTH lost your job? If we sold our PPOR we'd have the rest plus income.
I asked "What would you do if you lost your job?" She looked at me as if to say Point taken.
I know she wouldn't be able to make her mortgage repayments and would most likely sell her house and rent with NO assets.

You'll always get that. People throwing things in your path that in all likelihood won't happen. But I like to have a What If plan anyway (even if it's just to throw back at them).

good points!

If you lose a job, not all is lost, if your work colleague loses hers... oops.

 

[daniellee]

Hi Invest,

1 - Seek advice from those who have been successful in PI, or read plenty of books and get advice from the forum.

2 - Limit your discussion to those who are open to PI. My wife and I openly discuss with an aunt of mine and no one else, unless asked.

3 - Do your research and plan for your contingencies when making a purchase. I was recently made redundant back in Mid Aug 09 but found a new job quickly. Still, the experience would have been more frightful had we not planned for such a contingency way in advanced.

4 - When success starts to come your way, if should not change who you are in the core. Many people will start to behave differently when they find out about your successes.

All the best.

Daniel Lee

 

[fokas]

Maybe leave a copy or two RE investing books around that they might pick up and digest. Maybe!

Or like some families, well intentioned gifts of easy to digest RE investing books given directly to family members on special occasions won't ever be read.

 

[willair]

Hi all,

I am sure this has been adressed before but I wanted to quickly discuss one thing.

I come from a very educated family where my parents always held good jobs. While my parents had money, we were never rich or wealthy and our family immigrated from Europe just under 20 years so my family had to start afresh with nothing.

I have been reading about investing in shares and also RE as well as building my own business. And for those who have read Robert Kiyosaki (sp?) "Rich dad, poor dad" I feel exactly the same.

My dad is totally against me getting into RE investing. He considers it wrong and a bad way to make money. He is also against me doing the online business which brings really good CF. When I ask how should I make money, he never gives me a straight answer... but I guess he just does not know any other way or thinks that you should either have a big salary or design some clever idea for a business product/service that sells well.

I have had so many arguments with him over this, I have just given up. I am not talking about investing with him anymore as it only ruins things between us.

My dad was never rich, he never bought property for investment purposes even though when they bought their PPOR in 2002 just before the boom for under $200,000, their house is now worth around $600,000... I am just surpised that my dad cant see the huge potential with RE investing.

My mum is cool with it, she just tells me to be careful and not get into any financial trouble, while my brother thinks that before I even get into buying my first IP (I have bought my PPOR last year) I should pay off most of my PPOR mortgage.

Anyone else have similar people in their family that discourage you from success? And how did you deal with it?

Sometimes it's just better to play dumb and say nothing,or learn how to say
"My business is my business"..willair..

 

[jaycee]

I think it's sad how some people so quicklky seem to cut off when others asks a question. ANswer them !

depending on who they are

Like the work colleague who ended up thinking "point taken"... She sconverted now (to a point, my [ersonally need to get over the "how am I supposed to afford to do that, but that is natural too when you dont yet know"

I explained to my mum why I wanted to buy another when my own place is not yet paid off depsite being a low mortgage. She got it. Her only 'fear' is me nto being disciplined and ending up with normal bad debts as well as these debts and fidning myself in the red like that.

I don't know, not having been there yet, I am sure I'd react the same if in your shoes, so I guess more surprised at how "bad" it can get I guess than the investors' reactions.

 

[RedCat]

What a great read and perfect to go through in preperation for my meeting with the accountant and husband. Both are of the opinion that I should be whacking all extra income into my pricey PPOR. I listened to them for 2 years and amassed $180K in my offset account. And for what? To see that I'm paying less interest. Great.

Finally after a few months of finding positive stories and emailing them to hubby (whilst he emailed back negative press) he's finally on board. I know that's going to crumble again when we sit with my conservative accountant so I've had to agree that we will only invest using savings and equity from future IPS - no drawing on the PPOR equity whatsoever.

Not ideal but if it gets me started that's great. Hopefully in a few years he'll see the benefits and I can draw on PPOR equity too.

I can't WAIT to erport back to this forum once we lock down the first couple. We'll finally be in the IP game. Yay!

 

[sunshine]

Finally after a few months of finding positive stories and emailing them to hubby (whilst he emailed back negative press) he's finally on board.

Congratulations. Took me a looooong time to convert my Hubby too. As for acountants well, that was a lot of trial and error to find one that understands property.

Soon you will be like quite a few of us on here who have said to their Hubby "we just bought an IP and if you could just sign here".

Sunshine

 

[wobbycarly]

I was going to say keep the hubby but ditch the accountant.

 

[kissfan]

I was going to say keep the hubby but ditch the accountant.

Oooorrrrrr............

Regards
Marty

 

[Nikolina]

We don't speak about our properties to any of the relatives now. They know we have them, but they don't know any of the details or how many we have. We found that all of a sudden we went from just another struggling family member to the "rich uncaring landlord" and a lot was expected from us because we were now "rich" despite our personal situation not changing.

Some of the neices and nephews, now that they are getting older, have asked a few questions from time to time, and we have always been open and honest with them, but unless asked we do not discuss the subject at all.

Im the same. I don't speak about mine either. I decided from day one that the only people who will know are my parents. I just don't think it is anyones business knowing how much property i own and intend on owing in the future but my own.

 

[RedCat]

I'm back from the meeting with the accountant and he's on board now he knows my long term plan (kinda) but more importantly he told me which company/trust to use for what and that was the main issue.

I spoke to hubby again tonight and said here's two options, which do you prefer?

a) Access the equity in the PPOR and pay a 20% deposit on each of the first 3-4 IPs, thus making each one a easier to handle and less sensitive to interest rate rises

b) Don't touch the equity and pay 10% deposits on the first 3-4 IPs

Naturally he said we can't touch the equity - that's the deal we've made. I think I'll have to wait a couple of years for him to see the benefits and maybe then I can touch it! I guess the positives are we'll have even MORE equity to play with then

 

[bdc]

Anyone else have similar people in their family that discourage you from success? And how did you deal with it?

I think most family/friends who discourage people discourage them from risk...or perceived risk.

 

[Pandabites]

Not necessarily, I think it could be more of a matter of how you go about telling people...most of my friends who I've told (not all of course, just a handful) are very interested in how it could be done, are admirable of the 'courage' it takes etc etc and would like to emulate.

Coming off as a know-all, even in a small way, isn't going to endear (not saying that anyone here has that attitude when discussing) but you know what I mean.

 

[skater]

Not necessarily, I think it could be more of a matter of how you go about telling people...most of my friends who I've told (not all of course, just a handful) are very interested in how it could be done, are admirable of the 'courage' it takes etc etc and would like to emulate.

No disrespect meant, but I would suspect with a comment like this that you don't have a large portfolio.

We had nothing but positive comments when mentioning the first purchase. A few less, but still positive on purchase of the second. Probably neutral on the third, then downright nasty "tall-poppy" type comments on the fourth.

You soon learn to keep your mouth shut, unless asked.

 

[joanmc]

We found that friends and family can be happy for your first because they can see maybe doing that themselves, two makes them a bit nervous, three and it's "hmmm, you're getting a bit ahead of yourself aren't you?"; " what if a tenant trashes it?"; " that's very risky" etc etc and then onto some quite nasty comments. Now I only tell if I know someone invests or I am asked and I feel that I can guage what the reaction will be. For the most part now we say we are iether share traders (like that's not risky!) or farmers depending on the situation.lol

 

[Ajax]

I'm at the 3 IP's stage. I can see how buying a 4th or subsequent property could elicit nasty comments from some and am now inclined to keep quiet about what I am doing.

When a relative heard I was buying my third IP her comment was "That is three properties you now own?" Almost replied "Yes, when I last checked that's what one plus two equals".

A sister of a friend had a more aggressive approach. Her comment was "Aren't you being greedy and making it harder for first home owners to buy ?" Her comments when she heard I was earning part of my income from sharetrading were just as interesting "But what are you contributing to society. Aren't you wasting the money society has spent on your formal university training?"

In Skater and her husband's case I would find it hard to see how anyone could criticise what they are doing or how they contribute to society (based on the first few IP's we heard about). Taking cheaper ex-housing commission properties in bad repair (one was fire damaged I recall) and doing the hard work themselves renovating/rewiring etc then letting. If I'd been doing this and someone tried to cut me down to size I'd at least let them know what work was involved.

 

[bespoke]

In Skater and her husband's case I would find it hard to see how anyone could criticise what they are doing or how they contribute to society (based on the first few IP's we heard about). Taking cheaper ex-housing commission properties in bad repair (one was fire damaged I recall) and doing the hard work themselves renovating/rewiring etc then letting. If I'd been doing this and someone tried to cut me down to size I'd at least let them know what work was involved.

Yes, especially the one where her hubbie had to sleep there at night so the local kids dint trash it (again). That cant have been fun! Dont think I would have slept very well.

 

[skater]

A sister of a friend had a more aggressive approach. Her comment was "Aren't you being greedy!

LOL! That was exactly what our Sister-in-law said.

In Skater and her husband's case I would find it hard to see how anyone could criticise what they are doing or how they contribute to society (based on the first few IP's we heard about). Taking cheaper ex-housing commission properties in bad repair (one was fire damaged I recall) and doing the hard work themselves renovating/rewiring etc then letting. If I'd been doing this and someone tried to cut me down to size I'd at least let them know what work was involved.

Why thankyou! Although only one of them was in really bad repair, and a few are still in bad need of a reno, but they will have to wait a while, since they have long term tenants happily paying their rent.

 

[skater]

Yes, especially the one where her hubbie had to sleep there at night so the local kids dint trash it (again). That cant have been fun! Dont think I would have slept very well.

'Twas an interesting time.

Funny thing is, the local kids see a vacant house and think nobody owns it (why, I have no idea, but I have heard them talking amoung themselves and they truely believe this). They see a house that is getting fixed up for rental and you are "rich". As soon as they see that you have moved into it, they leave you alone because they see you as an equal.