Seen It All Before?

hi gramyre

in recent forums i too have noticed the `doomsday’ phenomenon, the cycle has reached the top…yada, yada, yada…..

i do agree that as part of ones overall investment strategy risk and quality of investment are two major factors. the other is the fact that if you enter the market at the top of cycle, you obviously will not make as great as return as if you sat around waiting for the cycle to bottom out. and therein lies the problem. wait with the possibility of missing out on a good buy or sacrifice short term gain and buy at the top?

despite all the negativity around the place i’ve decided to start my portfolio this year. i know im unlikely to see any significant cg in the short term having bought in Tasmania, my objective is to buy and accumulate.

so how did i go? well i settle on the property tomorrow, tenants are already in and the ppty is +cf.all in all im pretty happy actually. [biggrin]
if the numbers stack up, if you dont buy somebody else will buy it thats for sure! good luck.

Wow Pelican – I like your style, hope to be there someday!

I believe it was Jan Sommers that wrote “… it doesn’t matter if you by on a high or a low market, but I aim at buying at or below the median market price and hold for the long term….”
I like that theory (at this stage – I think we all go thru stages of different developments and styles) as I am mainly interested in Buy and Hold. Hopefully I’ll be able to match that with CF+ properties and I shouldn’t have any problems.

What return do you average for your 44 IPs, Pelican? If I may ask? I was aiming at 10 to 15 houses bringing in average of $200/ week would be enough for me to live comfortably in retirement! Of corse they’d have to be paid out or mostly paid out!

Just my Dreams….

Cheers

C@34

Hi Monopoly!
I thought you had been investing consistently for over 10 years? Surely, you would have seen a period of stagnation or slightly easing prices during that time? On the other hand, are you saying that you believe the market is now cooler/quieter than at any time in the last 10 years? [blink]
Have you known others who have pulled the pin while you stuck to your plan? Ever been tempted to cut & run? Where did you find the strength to remain committed? How long do you think the average investor will hold on in a flat market?
My own property investing experience is insignificant compared to yours (I pulled out when I thought the market had topped out in 03), so I value the insight you can offer.

Cheers,
F.[cap]

Hi Pelican.

Well Done. That is a truely amazing result and something that you should be very proud of. Great point about entry and exit to the market. Definitely not crapola as you put it.

Hi Monopoly

Great post as always.

Just wondered if you look anything like your avatar???

Cheers Shawn

Hey Monopoly

Just checked out the link you posted and you are right, I should post a mug shot!

Actually, I had not looked at that link before. And , by the way, a very nice photo of yourself you have posted there.[biggrin]

Bye for now

shawn

Of course you can…of course you can but as the song says.. Take the road less travelled, take the long way round…..New investors sometimes think of the flattening in months rather than years and tend to be a little impatient. Do you know the story of the young bull who said to the old one “lets race down there and jump a cow ! Replied the old bull “no son, lets amble down there and do the whole herd” If you watch business sunday on nine this sunday.. i think they will have a special on property and in the promos, an adviser said he thought that property may go sideways for about 6 years…For what its worth and with a fair number of properties in my portfolio, i tend to agree with him. The property market together with the sharemarket, but more importantly consumer debt is pretty much at a historical high and as such one should be cautious about going into shares or property. Thats not to say that a specific stock or property will not present itself as a special opportunity, just that generally you should exercise caution. Don’t forget that in most places for the 10 years from 1990 to about 2000, you caould buy property for about half the amount you would have to pay now. Dont forget that was for about 10 years ! with only a relatively small capital gain, compared to the 4 years since. Be like the old bull and take your time, which may be measured in years rather than months.

Hi All
Although I am about 1 second old compared to the years of experience Monopoly has in the property investing sphere I am considerably older in age, (by the way nice photo Monopoly). I have been in business nearly all my life and have seen the good and the bad. I have been the top roaster one day and a feather duster the next.
One thing I have learned is it is better to be proactive than reactive to any situation and I think property is no different. Interest rates are going to go up and that is a huge mistake by the reserve bank. I can tell you things are not good out in the business world, people are not spending. I have friends who normally make a big slice of their income in Dec, Jan who are down 80% on normal; a rise in rates will spell disaster for a lot of people.
Yet on the positive side the property boom was driven by a lot of so called mum and dad investors who were told to buy property as a hinge against old age and the fact that there is not going to be a pension available to them in 15 to 30 years time. Most of these people are heavily negative geared and it will not take much before there is a stampede out of the market by reactive people. This is good for the serious investor who will be able to finally get a few bargains.
I unfortunately missed the housing boom as I was playing the part of a feather duster at the start and couldn’t participate: but I intend to make up for that in the down turn. Sure there may not be a lot of capital gain around for awhile, but there are plenty of other strategies that can be used to make money in property, you just have to be a bit creative.

When I was a child I lived in Sydney around the Hurstville area. I remember a kindly old lady who was our landlord at the time who use to give me 2 shillings every time she came to pick up the rent. I later found out when I was older that she was a very wealth lady and not only owned the house I lived in but she owned streets of houses and shops all around Hurstville. She bought these when she was young in the great depression by going around collecting rags and selling them to people who made cotton waste. She then bought houses that people just could not afford to keep at bargain prices.

She is the ultimate example of being proactive when times get tough and although we are far away from a depression her example is still relevant today. It proves that a lot of money can be made when other people are reacting to things instead of being proactive.
I hope this helps anyone out there who is feeling a bit anxious at the thought of rising interest rates.
Kerwyn.

Im thinking last minute rush to get in before interest rate rise ?

Cheers
Brad

http://www.agentfreeproperty.com.au