Lemmings

Hi Yack i’m not a new investor but your post has wise warnings, i could quote a famous saving here “heed the roar of the distant drums” at the age of 28 i sold 4500acres of waterfront land (part owner) which today is Laguna Resort (1.3 billion dollar development) we got hit with a 5mill tax bill which we had to borrow and then the interest rates went up to 19.33% “that was a very character building experience for me.

Unfortunately when u are young you seem/feel invinceable until life deals you some reality which then gives you this thing called experience?? if you are lucky enough to get through it (some don’t).

Even Steve is giving warnings, but, as i am an optimist at the end of the day we MUST invest to give us freedom in the future when ever that time is for you, and i have learnt that there is always some one making money even when the interest rates were 19.33% deals we still being done.

Personally i think that commersial is better at the moment or buying land and building in South east QLD as i have just bought 15 lots in Ipswitch and stand to make 55k profit on each one, so you don’t have to buy and hold to me its about making money (profits!!!!!!) and moving on.

What does the word “investing” mean to people on this site, Steve and David bought 130 props in 3.5 years or 65 props each or 18 props per year for 3.5 years and have now sold some and are holding around 100 (form another post, i hope that is correct).

So if you are young don’t be a lemming – go for it because by the time you retire the Goverment won’t have enough money to support you and we will have to do it our selves.

“Some people have an open mind only to find out that there’s nothing in it.”

I agree with SiS, Resiwealth has done well ( you always ‘kick’ yourself about deals that you may have missed, i know i do, but , that too is a learning experience).[thumbsupanim]

However SiS has also done well and adapted to a changing market (Glad to hear you’re doing well trading)[thumbsupanim]

Should be interesting times ahead..

REDWING

“Money is a currency, like electricity and it requires momentum to make it Effective”
Count The Currency With This Online Positive Cashflow Calculator

Hi Yack,

i dont believe the market will fall, where im buying in the current moment, the reasons being are –

* extensive research is always done into areas that im looking to buy in
* the area in which im currently buying is a growing and growth area
* the property is under market value
* and each deposit that i save up, from trading, is then put in to an offset a/c against particular properties due to; (being negative geared or increasing cashflow due to higher interest rate)

once this property is, bought, i will put an emergency fund of $5k against it in a offset a/c to begin with, and start building up another deposit (in which im currently doing)

though another reason being is, i like Peter Spann, idea of buying negative geared growth properties – turning them into netural geared and then into positve geared, and getting that both capital growth + cashflow… that will eventually come.

*** the other thing that i find is, that because im a private option/share trader… i have liquid assets, which can be liquidate quickly, and able to resolve or fix problems quickly…

but overall, im in both a strong property and share capital position.

Cheers,
sis

Wanna Talk About Stocks

Hi Yack,

You know my opinion on this matter, we have discussed it many times. The only discrepancy between our opinions is that I believe that NOW is the time to buy BUT not at the expense of selling off a prime CG property (as I have read in this forum way too often of late) and/or if you are at risk of overextending your finances.

Ensuring both of these facts are taken into consideration, the market is rip for the picking of “good deals” and by that I mean vendors are open to negotiation because of fewer purchasers looking to buy.

IMO fear and ignorance fuels bad judgement, and if people don’t do their homework first, then they will make horrendous mistakes, and one of them may well be sitting on their hands when the market (as history has shown, will) eventually turn around and climb upwards.

By the way Yack, I have seen the rise and fall of several markets over my 23 years of investing, but unlike you, this phase of the property cycle has been/is one of my favourite times, secondary only of course to the “boom” times when I (as did many others) made a killing!! And can say with absolute confidence will do so again!!!

All in all though, I second your warning wholeheartedly!!!

Cheers, [biggrin]

Jo

I agree qwerty, but here’s the thing:

PEOPLE DON’T LIKE HEARING THE TRUTH!!!

They expect to post their ideas/plans up and that we “seasoned” investors blow wind up their perverbial backsides with comments like “yeah, hey dumbass, that’s a great idea, sure sell your IP that has grown by some 50% to buy 2 sh** holes out the back of bourke (if you can find them)”!!! Really, it doesn’t matter what we say, unless it fits nicely into their little box, they will just disregard it and go in blind anyway!!!

Hence, as far as I’m concerned, my patience doesn’t extend to stupidity; I am way too over it!!! [eh]

Alas, the horse holding up my “welcome wagon” has bolted!!! [blink]

Jo

Hi Monopoly,

I guess you’re right most people don’t like hearing the truth and prefer others to just agree with them.
Oh well, these deals will probably be the bargains we buy at a later date when they’re finally discarded.
[biggrin]

Hi Mono,

What if their sell price to get out goes real low or yields for the area are trending up or its prior to a price movement? Would you be interested then?
Changing market conditions can certainly make someone else’s “dogs” look a whole lot better.
[biggrin][biggrin][biggrin]

Here is the truth, and unfortunately I know that there are some here that will find this the hardest to deal with. It is: that the back of bourke properties (i.e. mine, steve’s in ‘west wendouree’, westan’s, del’s etc) that have way way way outperformed the blue chip or the up and coming inner city areas for capital growth. The highest performing suburb in Sydney one year during the boom was manly, let’s say it had 27 percent CG in a year. close enough. 3 percent rental yield. WELLLLLLLLLL

are you sitting down????

What about if I told you that I had 100 percent capital growth in 18 months on my properties.
This is not unusual, many investing compadres are telling the same story. I hope you won’t be too jealous when I tell you these properties were also making 24 percent cashflow returns.

So basically it was already good on CF but I also made 5 years of CF in one year with CG. Crazy eh.

But here’s the thing that TOTALLY shiznits me about this forum, ok, ready?

So…back 18 months…. I was in the minority here, as someone buying in NZ, and a new investor. only enough capital for the equivalent of a unit in Bathhurst, circa early 2003. I know this because that’s the kind of place I was looking at first. wasn’t even CF+ve there then even at the bottom of the market. For the same price you could get three freehold CF+ve houses in NZ. but back to where I was at at the time. Yeah, I’d done a seminar or two and read a book, but I wasn’t *really* sure. I was way ahead of the pack in NZ – I was there before Steve and Dave, before AD, before westan. Many of them even picked my brain before they went in there. I was in a tiny tiny minority and being shouted down by a wave of ‘knowing’ investors, blowing my hair back with a gale force of negativity -you won’t get capital gains there, it’s going to be more trouble than it’s worth, the risk, you’re crazy, you’re nuts buying there, that strategy won’t work, it will be impossible to sell, you’ll be fixing toilets in the middle of the night, that town is a dump, etc etc etc. It just wasn’t what the lemmings were doing. (insight: today’s dump suburb on the edge of town or undeveloped and undervalued town is tomorrow’s up and coming. go buy there NOW while it’s cheap. oh and buy bottom of the market cause that’s where the huge bell-curve of interest is, and always will be. Oh, and while you’re at it buy something you can add value to, either in capital or rent, which will then translate to capital value anyway, and then! Ah! then we’ll truly be on the same page!) So anyway, I listened to all these negative nay-sayers with a ‘zillion years of property cycles and experience’ and ‘millions’ behind them, and let myself get kind of psyched out a little bit. So what I did was buy three properties in cash, thinking, if they went bad like everyone predicted, at least I wasn’t geared. A year later, I now realise that listening to people who don’t know JACK even if they say they do (I was the one who DID know, I’d done loads and loads of research!!!!) -cost me dearly. If I had had the confidence to back myself, I could have bought 9 properties on 30 percent LVR, and had 100 percent CG on 9 properties and 20 percent CF as well. Hmmmmmph!!

So I learned my lesson. Don’t listen to people who don’t know JACK. Don’t let negative people who aren’t even investing, just sitting on the sidelines giving reasons why they’re not, slow my progress. It’s the 2 percent of the population that can think independently that will make the money, not the 98 percent that wait for all their mates to agree. they will be the ones who are way way way too slow. Another lesson being to take my advice from people who are in the market right now and making money.

I.e. Steve McKnight. del. westan. castle dreamer. those are the investors who I consider mentors and who I consult, who I consider to be people who KNOW.

In fact I could feel Steve kind of ….going AAARGH!!! She gets it, FINALLY!! cause he’s been the one that’s been telling me the whole time that I was going way too slow. He was right. But it was the forum – the lemmings – that psyched me out. These days I have a heap more confidence (oh, how sweet of you to notice!) and i couldn’t give a rat’s about being in the minority, because I’ve realised that it’s the minority that makes the moolah, not the majority, who are too slow and fearful. a little like I was when I didn’t want to gear at all ‘just in case’. Yah, well at least I’m over that now. OK Steve, Dave, I GEDDIT!!

I totally totally agree with the new book that says that buying problems and solving them is the way to make money- whatever that means to you – whether in property terms or in business or life in general.

A lot of people here are sitting on a load of equity they got from buying an emotional purchase zonk years ago (whatever) AKA their own house, sitting on their arses in their homes for a few years working jobs in the day and watching television at night, during one, two or five property cycles (depending on their current level of crustiness) and realising they are now worth a lot more $$$ – and sitting here gloating about it pretending they are successful ‘investors’. Well, that’s very nice and hey, it worked for my parents too, but much as I love them, I wouldn’t call them investors either.

I see how now you can start with the ‘janitor’ card and a whole heap of things stacked against you and STILL overtake those kind of smug pseudo-investors, that it’s still accessible for everyone to do the same, at any time in the cycle, on any budget. And that, people, is the real truth that Steve and the like-minded people he has attracted and ‘trained’ for want of a better word, those people are the ones to learn from. the ones in the market right now. always. the ones taking action.

I have now got to the point with my investing that I am able to look at deals one or two price-rungs higher than I was able to 1.5 years ago. And that’s even more exciting, because the competition is….hardly even there! it’s literally a buyer’s market for deals out there.

The hardest ones to find are the ones with no work involved, such as 10 percent + return on purchase, in a growth area, nothing to do. Of course it is those kind of deals that everyone
wants. But if people were prepared to roll up their sleeves they could make soooo much more if they looked for problems and solved them.

enough ranting…hey, it’s been fun…

joy to the world

mini mini !!!!
your success has definatly not been MINI
good on ya for having the b…. to take action and not listen to all the armchair experts,congratulations
and thankyou for sharing that i could tell it come from the heart & soul.
I always say the challenge of it is the BIGGEST thrill put your feet up ..you desserve it !!

Mini,

You’re awesome, and I take my hat off to you…That was a classic Mini post. [biggrin]

BTW – We put an offer in on a place in QLD yesterday (population of 50,000). Using some profits from a few of our 110% capital growth NZ purchases last year, has given us the momentum to purchase what some would class as “a real property” in QLD [biggrin]…

It will still be positive cashflow – of course, but maybe not the 25% yields that I was used to on some of my NZ ones…[blush2]

I really enjoyed hanging out with you recently also and I learned lots from you too…

Like Steve says “SUCCESS COMES FROM DOING THINGS DIFFERENTLY” – THIS IS SO TRUE!

Cheers,

Del