woke up a millionaire

Woke up this morning - decided to have a look at some recent auction sales prices in my area. Did a quick back of the envelope calc on my position. Haven't done this for some time as I am a very lazy investor (buy and forget strategy). Given the rise in values in my area, and determination to pay more than minimal amounts on my mortgages, I quickly found my nett equity position exceeded the $1M mark.

This is not, on its own all that remarkable, since by reading posts on this forum, it is clear I am not alone. However, it occured to me how simple this has been for me compared to some of the other strategies I read about.

This has been achieved without wraps, flips and kicks...No major reno's, developments, subdivisions.... no fancy spreadsheets, software or buyer's agents.....no searching in country towns for +ve cash flow, .....Oh, and I haven't spent a cent on any seminars. I have a stunning grand total of 4 IP's that are managed by 2 PM's.

Does anyone have a similar tale to tell. How easy have some of you done it. Has anyone reached massive wealth using a simple strategy with just a few high CG potential IP's.

Cheers:) :)
 
We'll be there ($1m nett) by next Christmas, assuming at least 7.5% CG.
My wife still thinks we are poor !

It just sort of happened.
 
How long did it take?

Agent,

Depending on which way you look at it, it took;

5 years from IP#1, or
9 years from PPOR, or
38 years from the day I entered this wonderful world;)

Cheers
 
Well done Oscar.

I got my call from the back seat of the car. A while back the family was out in the car and the wife was at me for a Merc. My retort was 'Yeh when Iam a millionaire' and out of the back seat pops a young voice ' But dad, you aready are'

The wife still doesn't have her Merc ;)

Cheers
 
You didn't wake up with the thought of having up to $1M in debt?

So many Aussies have this mentality that once they take out a loan for XXX amount, they instantly have that much worth. Unfortunately in this time of rapid change, nothing is certain.

Having $1M in the bank is different to owning the bank $1M.

Sure, your house prices have skyrocketted at the moment because of the value of property, but that's just like me saying I borrowed a million dollars from the bank to buy 1 million Microsoft shares when the tech stocks boomed... Of course after it all floped a few years down the track, instead of having shares that were valued 10x, one is in huge debt.

You say you're a millionaire, but according to the RBA they think it's debt............. "The Reserve estimates that households now owe $517 billion, more than three times the $155 billion owed a decade ago. " - http://www.theage.com.au/articles/2003/10/31/1067566088028.html


And you're surprised it was so simple. All I can say is. Making $1M is not this simple, but owing the bank that much is. :)
 
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Wealth is measured as net worth - what you own minus what you owe. Maybe Oscar is referring to net worth, if so congrats son.

Personally i was there years ago with a combination of my own business and investing.

My answer to people who ask why i do what i do is
'well what else am i supposed to do with my time?'


But the problem with wealth in property is its not liquid - you cant sell 1/10th of a house to buy a new car or go OS, thats why its smart to invest across different asset classes.
 
Hi all,

Brains,
"you
cant sell 1/10th of a house to buy a new car or go OS,"

thinking laterally, Why not???

It would be legal, It may be difficult, but it's not impossible. There may even be some tax advantages.

bye
 
Fair enough Bill but lets stay within the realms of reality :D

Originally posted by Bill.L
Hi all,

Brains,
"you
cant sell 1/10th of a house to buy a new car or go OS,"

thinking laterally, Why not???

It would be legal, It may be difficult, but it's not impossible. There may even be some tax advantages.

bye
 
Originally posted by Cosmo
Asset rich but cash poor. I still pat all my pockets to find enough cash to fill the car up!
I do the same, but only to find where the Credit card is !

re my quote yesterday "We'll be there ($1m nett) by next Christmas, assuming at least 7.5% CG.
My wife still thinks we are poor !

I should never have let my wife read that, she went out buying caviar and smoked salmon !! :mad: :D
 
Originally posted by brains
But the problem with wealth in property is its not liquid - you cant sell 1/10th of a house to buy a new car or go OS.
Thats where Brenda's position is good, 22 lower priced properties, she literally could sell one property and buy a car or have a holiday, and it would be less than 5% of her assets.
(conveniently forgetting all the selling costs ) :)
 
Hi all,

Brains,

Sell 1/10 of a property to a niece/nephew/child, who wants to get into IPs but is on the lower end of the earning scale. Have legal contract,register with titles office etc. Do same every year for 10 years. Relatives ability to borrow increases with equity growth(both CG and loan reduction). Your CGT liability is reduced by only selling 10% each year(depending on other income).

Well within the realms of reality!!

bye
 
Point taken. (said after weighing up benefit of another lengthy debate with Bill)
 
yep (for np2003), that's definitely net worth.

$1m debt on it's own is about as useful as a chocolate frying pan, but covered with > 2m in assets - I can sleep very easy.

Point of the post was it all worked out with little complexity, (and they say the first million is the hardest!).

This is just one milestone, hopefully with some better planning on my part, there will be many more to come.

About illiquidity.... I can always redraw some pretty substantial amounts given I pay more than IO anf LVR is 50%

Cheers,
 
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