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Great contributions everyone. Really impressed with “Old timer’s” and “Brenda’s” replies. Just imagine if we could tap into all that knowledge that is obviously out there in the community. I remember a famous quote by an elderly chap worth a few billion who still is running his show – who said “You can’t teach a new dog old tricks”. I’d like to learn some of the older techniques.
Anyway…..here goes;
Bought first prop (IP) with wife just after getting married at 24. Very -CF. Big thing was scrapping up the 10% deposit. Got shafted royally by the finance broker. Haven’t used one since.
Bought second prop (IP) two years after that. Very -CF. Got shafted by white ants – despite an inspection. Tenants eventually destroyed this one.
Bought third prop (PPOR) – paid cash for our PPOR. It was nothing flash (3×1 B/T) but suited us at that time. Made no mistakes with this one. Learning curve starting to plateau.
Bought fourth prop (IP) – a big step for us at the time…posh suburb…very -CF.
Bought fifth prop (~IP, beach shack)…not really for investment…mainly for fun…very -CF.
Sold Props 1&2…very good move – pumped it into equities – no tenant hassles or ongoing costs.
Bought sixth prop (IP)…extremely -CF. Definitely worst house in the best street scenario….lotsa work and no cashflow. Ended up being our current PPOR. Paid off now.
Bought seventh prop (IP)…riverfront but extremely -CF, so much so, vowed never to buy another residential prop. Getting crushed at this stage by interest payments. The goal of giving up work and retiring was moving further and further away !!!
Bought eigth prop (first IIP)…big +CF, much better…eased the tension heaps. Nothing to do and costs us nothing
Settling on ninth prop now (2nd IIP)…big +CF, and cashflows are looking better all the time.
Despite the -CF outpouring over the years, the growth has gone through the roof, which was our aim. We’ve gone from 10K equity to controlling 8MM. Bank has just approved another 3MM so we are currently on the hunt for props that have the ability to replace my job/ income.
There is a heavy expectation to retire in 2 years and 4 months at the age of 37. Retire from working that is, not buying IIP’s.
Would love to hear some of the other older investors tales.
Cheers,
Dazzling
“Go hard or go home”
Thanks for all of the great responses. It was very encouraging to know I wasn’t the only one “in this boat”, especially with some of the senior or veteran contributors experiencing versions of this.
I suppose all partnerships are going to have differing levels of keenness.
Fear seemed to be common thread in the responses. I don’t believe it is fear, as we have owned IP’s for over 10 years now and we are both pretty comfy with the debt situation – although the scale of things is getting such that we now have no-one in our immediate circle of friends and family to guide us…perhaps this is partly to blame.
No need for the ‘little rewards’ technique either, they are taken regardless of the investing results.
Anyway, cheers for the responses…very comforting to know others situations, I’ll do as Byronent does and forge ahead. The wife is definitely the people person in our relationship and I am the number cruncher – perhaps we should buy a high yielding hotel and let her at it !!!
Dan,
1. Pest control (white ant)…I find them to be a joke and do not perform these anymore. Got burnt royally (30K) on my second deal. [angry2]Certificate wasn’t worth the paper it was written on – in the fine print it was valid and enforceable for only 24 hours after the inspection….the company mailed out the certificate 2 days after the inspection. Company has since gone broke. I figure I can carry a torch and screwdriver just as well as the next guy…(have accompanied 7 inspectors for family members all up, all bar none had nothing more technical than a screwdriver and a torch.
2. Building inspections – absolutely essential. Don’t sit in your office while they do it. You get an immense amount of info by showing up to property 10 minutes before he/she does in your overalls / light / ladder and go through the place with them. Get up into the roof cavity with them – crawl under the floorboards with them…they are happy to point things out that never make it onto their standard reporting pro-forma. Actually, I honestly think they find it comforting that they are not the only ones crawling through the cobwebs and muck by themselves…a bit of comraderie develops and you get maximum benefit from the inspection. If there is white ant problems, you’ll see it with the builder, they know what they are looking at…(negates to have to do point 1). I find registered builders to be excellent, I’ve had architects as well but prefer builders…depends on the building type and the ‘robustness’ of your own personality. [bonjour]
3. Strata stuff – no idea, never bought one and never will.
Cheers,
Dazzling
“Go hard or go home”
Ryan,
I’m new myself so everything is IMHO.
I remember reading somewhere (think it was one of Warren Buffett’s texts) where he was quoted as saying the best philosophy is to
1. Put all your eggs into the best basket and
2. Watch that basket !!Even though it ran against the grain of what all the investment guru’s on Wall Street were preaching, he insisted that diversification was definitely not the way to go.
His investment philosophy seemed to go OK.
Cheers,
Dazzling
“Go hard or go home”
A little ol’ shack just down the road sold recently that rented for $1.3MM per year, signed up for 10 years too…..so the answer to your ridiculous question is less than one.
But then, if you were able to afford it, you wouldn’t be asking questions like that…
Grab a calculator and some grade 6 maths.
Cheers,
Dazzling
“Go hard or go home”
Extremely happy with investing in WA. We haven’t experienced the huge surges like Vic and NSW, but we also aren’t seeing the drops as yet either.
I know it’s easy to suggest and extremely hard to do, but if you’re having trouble searching for non-negative props, my suggestion is to get the numbers a tad bigger. Tenants / clients are usually happy to fork out “mucho denirio”. I don’t mean posh houses either…I’ve looked for houses / flats here and found the same thing as you.
Big office blocks and/or smelly & nasty warehouses and sheds seem to be the way to go. They are more than happy to pay all your outgoings and P.M. fees. I absolutely love it when tenants pay money to manage themselves…[biggrin]
Cheers,
Dazzling
“Go hard or go home”
