I’ve just joined up and having had a quick browse through the various forums, I thought I’d tell you my story in the hope that I can reinvigorate myself!
In 2003, I lost my well paid job running a training company in the US (By the way, I’m English – just so I don’t get mistaken for a septic). Basically, the company went down like a lead balloon after 9/11.
To be honest, I wasn’t that bothered about losing the job. After all, who wants to be a wage slave? We’d also decided (me, the trouble and strife and the four dustbins) to emigrate to Oz so the whole thing just got speeded up.
We returned to the UK – North Wales to be precise (the wife is the fully monty Welsh speaker – she was very happy about your recent Rugby defeat!) – whilst we waited for our immigration papers to come through – and I had a bit of a holiday. Then I got bored. Really bored.
So, having always liked houses and needing a “hobby”, I bought a 1940’s four bed, two storey renno in a small village called Gronant. I paid A$355k for a house with no working toilet, a herd of greyhounds in the basement and a subsiding staircase! It was a bargain. No really, it was.
I spent the next six months laying bricks, tiling, polishing floors and fitting bathrooms. We sold the house for $650k! I spent approximately $85k so I ended up making $210k in six months. To say I was happy is an understatement.
Then we emigrated to Australia. Tasmania. Don’t ask me why, we just liked it – or rather the wife did. I liked the fishing and diving (although it is a tad cool).
Right now I’m finishing off a 1910 house I bought for $130k in New Norfolk. I’ve converted it from 2 to 3 beds and it should fetch $195k. I’ve spent about $30k and its taken about six months. Jeez, its been a drag. It should have taken four months tops.
And, I’m looking at this and I’m thinking what is the point? I’ve got another deal lined up but its pretty much the same sort of numbers (although I could strata title the land and build two units if Australian Banks would stop treating me like a three year old – no Oz credit history, no accounts, no salary equals no loan).
So, I’m slogging my self to death for c$70k a year with a pretty high amount of risk. Why don’t I just go and get a nice 9 to 5 job again? It wasn’t that bad being a wage slave, was it?
So, I finally get to my point (I can hear the sound of cheering). I was wondering whether anyone else has had similiar feelings, crises of faith. And if you have, how did you get over it (barring medication!)? Please help me not to go back to work!
Any encouragement would be sorely welcome!
By the way, I’m normally a very cheery type of person who is kind to small animals, old ladies and children! But I hate cats.
Andy
When tenants dont pay, when you have to pass up the deal of a lifetime because you cant scrape up the capital, when building wealth seems to take a REALLY long time, when the bank balance says $0, when your freinds are driving new BMW’s and living in $1m homes (with $1m of bad debt), when you cant rationalise owning a boat (wont make money and the money would be another deposit) when your holiday money goes on a repair, when birthday presents are DIY specials etc…. I just for a few seconds wonder if it would be easier just being an ignorant 95%er.
Nah, not for me.why don’t you go back to work? what’s so bad about working anyway? Tasmania is a great place to work – the hours don’t seem to be long in most companies and you can still do all the things you are doing to houses in your spare time if you are committed to it.
there are a lot of people on these forums who are starting out in the investment ‘escape the ratrace’ career but sometimes you have to wonder what’s the point when you can achieve the same outcome by working and having a great life. I fully support retirment at an early age, but i won’t be quitting my job for a very long time because it achieves a strong cashflow position – you did mention that the banks don’t really want to talk to you. With a decent job they will give you almost anything you ask for.
to acheive my income via positive geared properties would require me to have built up something like 40 properties. managing those would be more than a full time job! and i would have no annual leave, no sick leave, no time to my friends and family becasue i would always be on call to an emergency. where’s the logic in ‘escaping the rat race’ in that? so what if i have a manager to answer to? doing what you’re doing doesn’t give you a manager, but you’re still having to answer to tenants and banks and so on. that still requires you to use relationship management skills just like a manager.
i love property investing and renovating and it is a key priority for me however it is on the side of my full time career. it has created equity for me, and will create long term prosperity for me to retire earlier than most, but there is also a lot of value in a full time job. you get training that is useable across your property investing career, you get promotions and payrises as well as other benefits.
in a job if you work hard your earning potential is limited only by yourself – think about the ceo’s out there earning $1, 2 or $10m a year, there are no limits. a lot of people are aiming to escape the ratrace and that’s including me but escaping the ratrace can mean working in a fulfilling job for an employer and having investment on the side meaning you’re not part of the ratrace becasue you have enough overall income to acehive and do the things that you aspire to.
i think you need to sit down and rethink why you really don’t want to go back to a job. at the moment you’re saying property is only going to provide approx $70k a year in income with a lot of effort and risk. if you can earn more than that in a secure job then I think you’re answer is an easy one. You can more than likely keep the $70k coming in on the side via weekend or late nights renovating.
Hello Andy,
Sounds to me like you have a skill!!!!
Now you need to manage that skill for succesfully making money and reduce the time and effort required on your part to achieve it.
Why not aim to complete multiple reno’s and contract some of the work out?
Aim to do 4 properties a year using someone else’s time. With smaller returns.
Still make 70 K and spend half the time you do now!
Even furhther ahead what if you contracted all work and just signed the checks!!!!-Thomas
“More Time To Snowboard”
jenwren
I love it , know exactly what you are talking about.
Nazzysmith
I think the problem is that the banks won’t lend the money so it makes it hard to do more than 1 property at a time , but I agree there could be a better way .
Hey when the season starts would love to go for a board with youCheers mate
Buying Propertys in the USA email me to learn more.
[email protected]Maybe and idea hold onto the first property and use the equity to fund the second
, maybe the security will assist with your next loan.But again depends on your personal situation and where you want to go.
Will the property be +geared? Imagine that, a cashflow, not too mention depreciation of certain fittings & fixtures you have just slaved for. Oh and by holding I guess you would also slash the CGT on the profit too.
Maybe get a good accountant and finacial planner in Tassie, not a devil either.
My little advice
You hate cats. Go back to the UK[biggrin]
Your 70k a year of risk, sounds better than my 50k a year office grind working in Collins Street Hobart.
My partner and I did a plastering course (1 day) at the tafe and we would love to be Reno Kings
(buying our PPOR first though (maybe even tomorrow))
I stared with my firrst property when I was inbetween jobs and the bank was more difficult to deal with due to the fact that I was not working at that time.
The statagy that I have developed since that time is to obtain well paid employment in an industragy that provides me with good skills as well as information and contacts that also assists me with property investing.
Now as well as doing a job that I pretty much enjoy that provides me with a good income I invest in property as well, my main statagy for property investment is buy, improve and hold although I am beginning to do some development work as well.
I look at every property and work out not only how to best increase capital value but how to raise the cash flow form the property also.
As I get regular pay rises , rent increases and of late increases in capital value it improves my financial position and enables me to move forward and purchase more property.
I could choose to retire at any time that suits me – the banks can not recall the loans as they are fixed P & I loans.
I like my job so intend to stay there for now and when I do eventually retire the income that I receive from investment property should be quite substantial.[aacool]Lacey A.N Ward
, maybe the security will assist with your next loan.
You must be logged in to reply to this topic. If you don't have an account, you can register here.
