Using a buy & hold strategy, in how many years did you reach financial independence?

Discussion in 'Property Investment - Other' started by Ari_X, 23rd Feb, 2015.

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Using a buy & hold strategy, in how many years did you reach financial independence?

  1. Less than 2 years

    0 vote(s)
    0.0%
  2. Between 3-5 years

    2.9%
  3. Between 6-8 years

    11.4%
  4. Between 9-11 years

    22.9%
  5. Between 12-15 years

    14.3%
  6. Between 15-20 years

    11.4%
  7. More than 20 years

    37.1%
  1. Ari_X

    Ari_X Member

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    Starting with no assets and assuming you were a passive investor and diversified your portfolio i.e. 2-3% growth above inflation, most Australian literature will tell you can replace an average income in 15-20 years using a buy & hold strategy.

    In theory you can accumulate between $2-2.5MN of equity which should return 4-5% rent equating to $75k in today's dollars. (which is the current Australian average income)

    My question is: have you done this quicker than 15-20 years and if so how did you go about this?
     
    Last edited: 23rd Feb, 2015
  2. Ace in the Hole

    Ace in the Hole Don't compete, Dominate !

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    I'd guess they'd be few and far between, anybody who started with nothing and invested in property completely passively while generating an average income.
    This would be a relatively slow method.

    Many of variables though.
    Personal incomes can increase a lot over time.
    And, what's the definition of passive property investing, buy as is and only ever carry out basic repairs and maintenance?
     
  3. want2bewealthy

    want2bewealthy Getting wealthier

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    Hi! Just stopping in to check the goss

    Took me 10 years. BUT (there is always a but, many people fail to mention. .) We have no kids and don't plan on having any. We don't have a billion dollars in the bank. We don't live in a gigantuan house, we fail to use the service of a butler. BUT, we DO live comfortably. We are young. We have choices. Life seems easier in the financial dept anyway, you never know what life can throw. But most importantly: we have time. That is what my plan was based on so achieved that.

    "IF" my plan was to have the butler in the McMansion I'd say we needed another 20 years or so, give or take. But no thanks. Life is a higher priority for me and I could be hit by a Datsun tomorrow!

    Still work one to two days a week playing guitar, but I see it more as fun
     
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  4. Ari_X

    Ari_X Member

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    Good point Ace I'm just trying to figure out if anyone can actually succeed in a human lifetime through a passive buy & hold OR is it an absolute must to get into a more active investment strategies like renovations/developments/etc?
     
  5. Ari_X

    Ari_X Member

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    Fantastic results, thank you for sharing :)

    Can I ask how you were able to achieve that result in just 10 years??
     
  6. want2bewealthy

    want2bewealthy Getting wealthier

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    Buy n hold my friend :)

    Just buy as much as you can. Work your poor *** off and trade it for a portion of your soul. Hope that you can keep a job. Hold on by the seam of your pants, all while learning to savour the taste of Sui-min & Sao, until one day you can sell the lot and actually feel rich. twas a hard road for me that kept getting harder job wise but thank God I was able to make it out (relatively) unscathed. I had to then learn how to 'live' again after being a wage jockey for so long. I still am learning but I can tell you this: Life is wonderful for me today and i'm thankful

    good luck man! I (and most others here) was you just 10 years ago. Check my first posts if you don't believe. So, you can definitely do it if you have enough desire and dedication

    Or. You could take the 20-30yr approach
     
  7. D.T.

    D.T. Property Lookerafterer

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    Buy and hold is quite simple, in fact everyone in Australia can do it.

    The time frame required is just far too long for me.
     
  8. bumblegoodie

    bumblegoodie Call me BG

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    DT what do you suggest doing instead of buy and hold?

    I think if you invested in property the general idea is it will double every 10 years......

    so within 10 years then you should be quite comfortable.
     
  9. Ace in the Hole

    Ace in the Hole Don't compete, Dominate !

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    It's good once you get up the exponential curve a bit with a bit of equity behind you, but the OP said starting from zero assets.
    Getting off the mark is the hardest and longest part of it all.

    I highly doubt anybody could do it absolutely passively in 10 years starting from zero, on a relatively average income, simply waiting for CG to happen, unless you get extremely lucky.
    And anybody jumping in and out of deals, adding value, etc, is not really acting passively.
     
  10. D.T.

    D.T. Property Lookerafterer

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    If you're starting from 0, then 10 years is no where near enough for a buy and hold strategy. Chances are you can afford 1, wait a bit before getting another etc. Once you have a few then you can change up a gear of course, but that'd probably happen 5-10 years in unless you started with a few properties at year 0.

    That's completely fine if thats all you aspire to.

    I don't, so am speeding the process along abit by creating your own growth via buying under market, renovating, developing, etc. Keeping good yields at all times to keep the whole game afloat.
     
  11. Theodore

    Theodore Member

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    Love that last bit - I often say to myself the cashflow
    Just keeps me afloat whilst I manufacture equity

    I also do believe the buy and hold won't give me the jump start in capital
    That I need but I can definetely see the passive route advantages as I get older and have more equity behind me

    My strategy thus far has been to buy under market, Reno and reval and buy again!! But these are cheaper Houses with a long term outlook
    So I am basically free carrying the IP whilst I spread my capital elsewhere !
    I am all about expanding my asset base

    I have made between 80k - 100k in 2.5 years not that it matters
     
  12. want2bewealthy

    want2bewealthy Getting wealthier

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    Highly doubt it?? What about me!? Oh, I also realised looking at my join date it's actually been 8 years. I started with nothing. Fact I used to be homeless..

    depends how hard you go, how 'lucky' you get and how bad you want it. Once you're almost done the next thing you need is to get onto the right forums. This one's good for buying while you work but terrible for retiring

    C yez! :)
     
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  13. MTR

    MTR Bling Bling

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    As much as You need to be focused and consistent etc etc, however luck also plays a part in this

    It can go pear shaped if someone gets ill, loses their job, divorce 50% atm, that will screw the finances
     
  14. dajackal

    dajackal Member

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    Been building a boring buy+hold property portfolio over the past 8 years that should generate at least 100K/year in equity while I sleep...which is more than I earn in my day job.

    Thinking of 'retiring' early by moving to a country with low cost of living for a few years while the portfolio continues to compound, then returning to Australia.
     
  15. Biz

    Biz $17 DOLLAS YO!

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    Dont leave us hanging mate! Linky?
     
  16. Ari_X

    Ari_X Member

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    want2bewealthy from homeless to retired in 10 years?! :O

    You could write a book and make a killing (if you haven't already!)
     
  17. Ari_X

    Ari_X Member

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    Nice work dajackal. When do you think you can retire with the $100k passive income? Are you saying it's taken you a total of 8 years?
     
  18. Ace in the Hole

    Ace in the Hole Don't compete, Dominate !

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    What kind of growth do you require for the portfolio to grow at 100k/annum in equity?
     
  19. dajackal

    dajackal Member

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    5% which is quite conservative (inflation + 2%)

    Should be quite achievable as all my properties are in middle ring suburbs of Sydney and Brisbane.
     
  20. dajackal

    dajackal Member

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    For 100k passive it'll be something like what you outlined in the original post.

    My journey started 8 years ago, bought in 2007, 2009, 2010, 2011, 2013, and 2x in 2014. Deposits are getting easier to find now that I have some equity built up. Still a long road ahead of me but I can see a path now.