Whether/how your goals/strategies evolved?

[Singo]

Experiences of fellow investors teach various strategies as each have travelled various paths! I reckon some of us have started investing with clear end goals and/or strategies but probably for most of us goals changed over the years. It would be great to hear from fellow investors how their investment journey progressed!

Our journey: The house we first bought was not somewhere we wanted to live forever but we bought it to hedge against future price increases in that area. So the initial plan was to sell and buy again. When we bought the second one, the plan was to wait for a full cycle so that house prices double and to sell one and keep other one debt free! But these two purchases taught us a lot about investing and our current strategy is to buy properties with potential to subdivide or build GF. The plan is to accumulate 8-10 rental income streams (including GFs) and live off rents once the inflation pushes the rents sufficiently over the repayments.

How your goals/strategies progressed?

 

[Colin Rice]

Umm dont sell for capital gain but hold and use equity plus increasing rents for future purchases.

Also to purchase properties that you can value add as you have mentioned.

 

[BayView]

Ours has been very up and down - currently down in a cashflow/servicability sense (was never that good anyway; so lower than usual).

Did own 5 IP's, but now back down to one. Have had to sell 4. See above.

Have changed PPoR's 5 times (hopefully the last one) - both seem to have restless souls and the need to keep changing the surroundings, it seems.

Goals?

Not enamored with Resi IP any longer - tenants have too much their way, and my tip is it will only get worse, and I reckon agents will continue an upwards spiral of management fee hikes - think W.A agents. The other States a sure to catch on at some point.

Any future useable equity for us will go into business (for cashflow) and then use the extra funds for either development type projects or Comm IP's.

 

[Oscar]

When I started investing 15 years ago the only goal I had was to obtain "massive wealth". A very fluffy goal, the definition of which has changed over time. I started with just property but now mix it up between property (local and overseas), shares (local and overseas), hard cash, and the JOB. The JOB has now become my bank and I don't borrow anymore. A very fortunate position to be in. I have always treated my job as a major asset and it has payed off very handsomely.

I'm now investing more into our local equities market and US based healthcare companies and keeping a very large parcel of cash. The property just trucks along doing its thing year after year, pretty much set and forget. I don't see my strategy changing all that much unless a black swan event takes place or I lose my job. But since my L/V ratio is only 25% it would just mean I take a rest and smell the roses for a while.

 

[Ace in the Hole]

For us it's simply been a matter of accumulate, accumulate and accumulate quality properties.
We've also been building a business in the meantime to fund this accumulation.

With retirement coming up next year, we will sell our business to pay off most debt.
This makes most sense to me because the business is hard work and income from property holdings is passive.
Don't want to ever sell any of our portfolio and miss out on future rental and capital growth.

 

[Singo]

Thanks Colin, BayView, Oscar and Ace for sharing your experience! Hope to hear from more investors!!!

 

[moyjos]

Yeah goals have changed over the years.

As young 20somethings , exHusband and I have but one goal, get out of debt. That strategy saw us buy,Reno, sell for 6 or 7 years until we had a typical 4/2/2 mortgage free by the time we were 30. We were both on lower-ish incomes and had 2 babies in that time .

The plan after that was to accumulate for retirement, but the husband thought he would be better doing that with the new girlfriend so divorce put me back a few years.

New husband and I bought and paid off PPOR fairly quickly and have been in business for the past 20 years. Goal has been to retire on average wages.
Strategy has been to build businesses and sell them. (similar to buy,Reno, sell ip's). This has worked well and provided wages in the meantime.

My husband is VERY risk adverse so it is a battle to get him to do some things.
(but I can usually manage to convince him it is a good deal).

My opinion is that as long as you have a destination, it really makes no difference what the journey is, as long as you get there. It is like saying there is only ONE way to get from Brisbane to Sydney. Umm no... Some people might fly (some economy, some first, some virgin some qantas) some might drive (new England hwy, or Pacific?). Some might catch a bus etc tec it doesn't matter, they all get to their destination.

 

[Singo]

Thanks Moyjos for sharing your journey!

I expected more investors will share their stories! Probably Richard Feynman should have started this thread

 

[map]

Bought 1st IP as a 24 y.o. after reading a lot of Michael Yardney, Margaret Lomas etc. and saw that as more affordable entry than buying PPOR. Goal was to buy another IP every 2-3 years and rent where I lived until acquiring enough IPs to retire off equity.

Bought 2nd IP a year later then sat on both for 3 years, which brings me to now- hunting for PPOR to buy! Not part of the original plan but met a great girl & she isn't comfortable renting for life, even if the numbers stack up better.

Sometimes you need to adjust for life- there are factors that affect personal enjoyment & satisfaction that go beyond pure financial considerations!

Plan now is to hit the PPOR mortgage hard (repay $12/month per $1,000 borrowed) and once under control return to buying more IPs - next one probably in 5 years.

 

[Blair007]

Still pretty young in our investment career. myself 25 and my gf 23 have brought a property where we have subdivided and building on back section.

would like to repeat this process a couple of times to build a good base portfolio,
our base portfolio will consist of 6 - 8 properties (3 - 4 small developments)
properties will be in the 500k range with close proximity to major cbds and potential for good long term capital growth.

developments can sometimes require a fair bit of cash on hand so while we are young and on above average wages with no dependents we can afford to build this base up without much financial stress.

this should put us in a good situation with a decent chunk of available equity through savings and the equity created from developing. hopefully our portfolio should be cash-flow neutral aswell (looks possible but bit hard to tell at this stage)

from that point with our foundations set the plan would be to focus on properties with higher yields - e.g. units close to cbds where we can renovate to create some equity and better rents and also have a property that has less maintenance. also keeping an eye out for other small developments if were in a position to afford then and if the numbers stack up.

if we do this and on average purchase a property a year for the next 15 we should be able to sell down some debt and retire by age 40.

fingers crossed it all goes to plan!

 

[china]

My goal has always been to get to a financial point wherein I did not have to work for the sake of financial reasons.

As opposed to other posters who just want to mass accumulate or get rich, I felt that a more defined goal would be much more objective and achievable.

In today's number, that goal would be about 4 million net worth - comprising a PPOR, shares, cash, super and IPs. This should give a roof over the head as well as allow 100k p.a. passive income. This figure should allow capacity to manage wife and kids, should they ever come along.

 

[Singo]

Bought 1st IP as a 24 y.o. after reading a lot of Michael Yardney, Margaret Lomas etc. and saw that as more affordable entry than buying PPOR. Goal was to buy another IP every 2-3 years and rent where I lived until acquiring enough IPs to retire off equity.

Bought 2nd IP a year later then sat on both for 3 years, which brings me to now- hunting for PPOR to buy! Not part of the original plan but met a great girl & she isn't comfortable renting for life, even if the numbers stack up better.

Sometimes you need to adjust for life- there are factors that affect personal enjoyment & satisfaction that go beyond pure financial considerations!

Plan now is to hit the PPOR mortgage hard (repay $12/month per $1,000 borrowed) and once under control return to buying more IPs - next one probably in 5 years.

Thank you map for sharing your story. It is good that you started early and congratulations for finding a great life partner. You may be buying again well before waiting for 5 years.

 

[Singo]

Still pretty young in our investment career. myself 25 and my gf 23 have brought a property where we have subdivided and building on back section.
.....
if we do this and on average purchase a property a year for the next 15 we should be able to sell down some debt and retire by age 40.

fingers crossed it all goes to plan!

For a couple in their early 20s, you have done extremely well. I reckon by 40, you will have a massive passive income. Congratulations and best wishes.

 

[jackbak]

My first goals were set when I was 17 or 18. Goal 1 was to own my first property before I was 21 and and Goal 2 was to own $1m worth of property before I was 30. Achieved the first goal but I lost sight of the second goal in my 20's and focused more time on travelling and having a good time but managed to reach the $1m mark at age 32 (earlier this year).

But they were just trivial goals I set as a teenager, my wife and I made some more in-depth and long-term goals last year that involve property, super & shares and aim to give us the ability to retire by age 55.

 

[JT7]

I look back in time to when my wife and I first dipped our toes into property and investing in general. To say it has been an epic journey is an understatement.

My investment strategy has developed immensely over the past seven years and we have been fortunate to accumulate several properties over the time. However, perhaps the most important development has been not only been the experience that I have obtained but the actual personal development along the way.

Both subconsciously and consciously I have become more in-tune with not only myself but my.... desires, goals and dreams. Over these past seven years I have one word that resonates with my ultimate goal - FREEDOM.

In relation to the mechanical side of investing we have certainly developed along the way. It seems each new avenue we consider is a door to opportunity. I've chosen mentors along the way, many of which are available to everyone. Jim Rhon I think is brilliant and inspiring and he is among many.

Perhaps one of the most important skills that we have developed is being able to identify an investment whether it be property, shares or some other investment at under market valuations. Being a contrarian investor at times is psychologically and mentally demanding but the rewards can be immense and is something I'm having to contend with recently on my investing journey but the opportunity is great.

I figured out at some stage along my journey, probably just like the rest of you brave people, that I have a choice. I have a choice whether to accept mediocracy or accept that we are on this Earth to do something great and to be FREE to chase our dreams. I'm going to contradict myself here but too me there is no choice in this equation.

Anyway, to cut a long story short it's been quite a journey but it's taken dedication, determination and commitment. I'd probably go as far as to say maybe bordering on obsession but the reward to me is priceless.... FREEDOM.

Now that's D&M for a Saturday morning!

Back to changing nappies which is my other passion.

Have a fantastic day,

Jack