I just finished reading the book during the weekend; it was a really interesting reading; showing me a new world of opportunities and concepts that I did not know about.
However, after finishing reading the book I have now a lot more questions that before.. One of the areas which I still donâ€™t understand is how you finance to buy too many properties in just one year â€¦ I donâ€™t see from the money is coming.. I understand how is possible to buy an investment property using the equity and saving that I already have .. but how do I get the cash money to buy others 5 o 10 in one year.. could anyone help in relation with this topic.. I will welcome any advice..
Yes, but from where do I get this money.. I will assume that from the salary that I receive from working. But in a current market where values of houses are over 150.000, the minimum deposit that I need is 20% or $30.000.
With a salary of $50.000 a year, I could meet the deposit to buy one house a year in best case.
This is what I donâ€™t understand how can I come out with all the cash for different deposits (lets say to buy 5 properties in a year) ..
The source of your misunderstanding may lie in the fact that you can’t do it.
There is a big difference between not understanding something, and simply not being able to afford to do it.
To gain understanding, simply take your fully paid off title deed of your PPOR worth 1MM down to your friendly local bank branch, and along with your $ 500K p.a. salary, buy 10 houses worth 100K each (LVR of 50%) and merrily service the loan that you’ve just taken out.
If your particular numbers for both the equity you have in your PPOR and salary are not big enough for the bank to approve, then you cannot.
I think it is the lack of big numbers, not lack of understanding, that is causing you to not reach your stated aims.