- SchplakParticipant@schplakJoin Date: 2014Post Count: 5
I'm new to property investing and was wondering how you would go about transitioning from a regular job to becoming a full-time property investor? Because it seems to me that you need to have a regular good income (at least 6-12 months in same job) with payslips etc to be able to get finance, however you also need to have the time to review properties and conduct due diligence etc.
I understand that money follows management and that you would likely be able to get some form of finance, be it private or public, if you look hard enough, however from my research those loans generally have much higher interest rates, which would reduce any income the property generates.
Any info would be greatly appreciated
PeterCorey BattParticipant@cjaysaJoin Date: 2012Post Count: 1,010
Generally most investors stay employed for a number of years to enable continued purchasing. This may open up other avenues such as development, renovating etc which can increase yields and capital gains. Of the number of property investors, I know of very very few who are effectively unemployed and investing, they either have invested for a decade +, or have established property based businesses which were built on a large cash base and extensive experience in the roles undertaken.CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404
You work hard (at your day job) then you go home and work hard on your investing.
Nights, weekends, whatever it takes. When you are further along the line you may be able to go part-time or leave your day job but in the meantime be prepared to put some overtime in.Richard TaylorParticipant@qlds007Join Date: 2003Post Count: 12,024
As has already been stated very difficult starting out.
I remember back in 1996 when I started full time investing and developing in Australia was a matter of balancing a day job as an investor with Broking and Financial Planning in evening and I had substantial cash funds behind me.
Funny that 18 years later I am still Broking however these days it has nothing to do with needing to earn an income from it more a matter of loving to help investors start off their own property investing journey.
Will take time but with the desire and hard work you will get there.
Yours in FinanceAdrian CahillParticipant@adriannqldJoin Date: 2003Post Count: 128
I just spent 6 months back in Australia helping my friend fully transition. If you email or PM, I could put you in touch with my mate and you can call him direct.
So I just went cold turkey on work about 2008/2009.
My friend was having a bit more of a challenge. B read so much Steve M, and Investing stuff. He really wanted to have a 'safe' passive income bigger than what his current salary was.
I spotted or partnered with him. Financially and Psychologically. It like being at the Gym. I saw him trying to lift some heavy stuff and even though he is a big boy, I went to back him up. And I did, with my full focus and in the end some deposit money as well. It worked well and he had the extra confidence and cash to close more Vendor Finance deals. Cash Flow is now coming and he is on his way. His income is not fully replaced yet, but he has left the workforce. He spent years studying. However it wasn't untill he pulled his finger out and got serious that progress really started. I think it also helped when I arrived at his regional town, fresh off the plane from China saying come on! Having a network of winners certainly helps.
Another friend M, went on a big buying hunt for big cashflow in his last months of work. He had bought a couple of properties. However if he went hard, early retirement was/is on the cards. M bought a big reno project on Gold Coast, and did well with it. He had a couple of months paid leave/redundance pay and in that time did a quick (but big reno). Before finishing reno he was offered and took another work contract but its in WA.
M and I don't do any coaching work together. He is more on his own just reading books and blogs. he is struggling a bit with Stress and managing everything solo. Despite having much more cash and cash flow then my other friend. He could retire now, however he comes from a 'safe' environment.
The guys above me here all through your post, know the Finance game and give great advice. Don't forget the psychological side of the house as well. Thats what really makes the differnce. The desire to succeed and make that transition successfully. And why do you want to make that transition. Perhaps make a dream map, or some goals about what is going to be on the other side of the Transition.
I firmly believe that:
Retiring early is easier then ever,
If we don't have the resources or knowledge to do it, perhaps we can find someone that does.
It's not an easy thing to do.
One way to do it (and it won't apply to everyone) is for a couple to have one person renovating, etc whilst the other still hold down a job.
Providing the job provides enough for servicing purposes – you might be able to get away with having one partner focus on the portfolio whilst the other slaves away at a desk
Obviously it won't work for everyone – you need to be in a relationship for starters….and I don't think there's a sub forum for match making on this website…..
JamieCorey BattParticipant@cjaysaJoin Date: 2012Post Count: 1,010
The other option is to work part time and take leave when renovating, so you can effectively spend your time wisely with getting each project done as quickly as possible. The key is balancing serviceability with your investment plan. If you go hard early and commit to each 100%, you will be able to take it easier much sooner.
Thought id put in my 2 cents worth.
You should be able to do full time work + investing successfully.
We have 24 hours in a day, so if you plan your self in a disciplined manner you can do both.
My example: I wake up at 4am to look at what happened and happening in the USA market (Shares). This usually takes 45 mins…
I start work at 8:30, so i get in at 7:30 to plan my day for both work and investing goals.
at 10:00am when work mates are having a CIGI break i am waiting for the share market to click over
12:00 to 1:00 i look at what shares im going to sell and buy (if any) during the day.
at night, i look at propties and do some research.
Saturday and sunday same thing again….jmsrachelParticipant@jmsrachelJoin Date: 2012Post Count: 711
Johann what time do you go to bed? You make sleep sound so over rated!Jpcashflow wrote:Mate I only sleep 5 to 6 hours a night, that's all I need
Same – but I'd like more……my 11 months old doesn't think I need it though.
JamietommytuckerParticipant@tommytuckerJoin Date: 2010Post Count: 82
My biggest question has and still is: where does the deposit for the next property come from? I understand cash is king, whether it be from a vendor finance or a simple cash flow positive property. But the banks won't lend unless you have that 10-20% deposit.
If I'm building a portfolio with simple cash flow positive properties I don't have someone else chipping in to make the deal work. Is it simply a matter of hanging tight until the CF+ builds up enough combined with the equity of the already existing properties for that next property? This just seems a long way off my traditional understanding of purchasing 1 property a year.BennyModerator@bennyJoin Date: 2002Post Count: 1,416
Hi Tommy,Quote:My biggest question has and still is: where does the deposit for the next property come from? ……
This just seems a long way off my traditional understanding of purchasing 1 property a year.
The early days are always the hardest. When starting, more than ever, buying property "at a discount" or buying where you can add value quickly (reno?) is the way to go, even if cf+ already.
That way you get the quick equity jump that can help you into property #2, then #3, etc. One you have a portfolio of 5 or more, even a small %age rise in values (2 – 3%) can be enough to allow you to buy #6.
BennytommytuckerParticipant@tommytuckerJoin Date: 2010Post Count: 82
Cheers Benny, that's what I was afraid you were going to say!
Jamie, you're a genius. You've planted the seed in my head that I will be able to reno places full time if my wife returns to work. I'd have to deal with the kids and home chores etc as well, but that's a small price to pay if this can help propel my portfolio at a faster rate.tommytucker wrote:
Jamie, you're a genius.
Thank you sir.tommytucker wrote:
I'd have to deal with the kids and home chores etc as well,
Uh oh – you're going to hate me.