Hey guys so I do have alot to learn in property investing I wanted to ask if this is a solid learning plan? I wanted to save 60k by the end of this year for a deposit but even if I do get it mgiht not even buy considering how expensive everything is. But lets say I was going to by end of this year so in about 5 months. Will this be enough knowledge you think to get started?
* Read a book a day until the end of this year, have read quite a few in a couple weeks.
* Read lots of forum posts to see what other people are doing in property and potentially learn from their experiences.
* Visit 100 homes by the end of the year (Though these books say about that many homes, but none of them say why. Could someone explain why to do it please? I assume its to get a feel for things, also if I do is this in open house inspections?)
* Assemble a team that consists of property strategist, solictor, real esatate agents, mortgage broker, tradesman, tax advisor,quantity surveyor, building inspector, accountant, buyers agent. I might be forgetting some.
* Get familiar with the streets around my suburb or suburbs I would potentially invest in. I will do this by either going on google maps or regular maps going to it. Or walk around the neighborhood to get a feel. Question I feel it is important, but I haven’t been told why this is important. Why would that be? The first thing that comes to my mind is that its good to know where you are investing. But then why do I need to know the sub streets and that? I can’t find an answer.
* Find a mentor if possible, who will be willing to teach me on my journey, someone who has achieved what I want to achieve.
*Going to auctions to get a feel for things, to see how it operates.
What do you guys think? Any suggestions?BennyModerator@bennyJoin Date: 2002Post Count: 1,325
Most of this comes down to common sense. Learning about the areas you want to invest in is so you can spot a bargain from the moment you see it. Back when my wife did Real Estate Sales, they told her that she should learn to “value” a house within $5k in her first 3 months. Now, that was 20 years ago, when properties sold for $100k or so. So $5k is like “judge the value within 5%”. In today’s market, I would think being able to judge value to within 5% is also a good aim – but that might mean to judge its value to within $25k (if a house value is around $500k).
Reading books is good, and so too is meeting people who are “in the game” to learn from each other, swap stories, network, etc.
Learn “the numbers” too, and I would think finding a Broker or Finance person should be one of your earlier team members to find. Why? Well simply that you need to know what financial possibilities you have (or could have by year end). That might help to steer you to particular areas where the prices match your financial ability. Then go learn THAT area by going to open houses, auctions, etc and talk with RE agents, tell them where you are wanting to be, and what you are looking for. Though you might not be a buyer straight off, if you are sincere with your goals, your attitude may well help them to warm to sharing knowledge with you, and to have you go to them when you are ready to go.
Nothing wrong in becoming more aware of your suburb, even if you may not be wanting to invest there. Why? Well, it is good to know the local market values with respect to your own home, isn’t it? Like, maybe the values scream up in your area, and your income allows you to borrow earlier than expected. In that case, you can maybe get a deposit from the Equity in your own home rather than having to save it up !! Equity Growth is the big kahuna when it comes to property investing. Learn its ways, and turn your steps in that direction (if your financial situation allows it – ask your Broker).
Re the rest of your team – sure, build them up over time, but I don’t see a huge need to get a list of good tradies if you don’t yet have an IP – so they can come down the list somewhat. Along with your finance man, maybe find a good accountant so you can get into their head re investing (make sure they are well versed in property investing before you “add them to your team”). There are accountants and accountants – get the right one.
Forum posts? Hell yeah – there are some beauties out there, and so much can be learned – use “Search” to pick your subjects. And/or check out the Articles in the Training Centre (see the Home page) that Steve and a bunch of other good people put together.
Re “streets and sub-streets” in a neighbourhood, it is often that a suburb might be “good” and yet one tiny area of that suburb is “not good”. Start by asking a local RE agent about this. Or check out houses for sale in the area – why do some not command as high an asking price, even though the house may LOOK the same as others in the area. There can be a myriad answers. Find a puzzle, then endeavour to find the answer for yourself. You will learn so much just by doing that.
e.g. Ask yourself a heap of questions re WHY the area is different. What is the median AGE of residents in that area? What does that answer tell you? e.g. Are young couples buying there only because it is cheaper than elsewhere? Is the whole area made up of young couples? If so, is there transport for wives with children to shops, schools, etc? Or not? Visit this “down” area at different times of the day. What is the neighbourhood like after sundown? Are there gangs evident? Evidence of street crime? Or is the area hard to access – and hard to negotiate once in it?
So many answers can come from simply thinking through the situation. If you get stuck, come and ask, or check with others with whom you network.
You sound keen, Inv – go get it !! ;)
Thanks for the indepth information Benny it is very appreciated, cleared up alot of questions. Now I can sleep at night :P
Investor if you do half of what you stated above you will be highly informed in 6 months mate.
a book a day, I would love to hear if you do this.
So I think ontop of all this, study Nathan Birch, he is one of the best models of how to get ahead through real estate I have ever seen. his Model outshines anyone who will comment on hear, now in saying this we are all human and do make mistakes.
In regards to what you didnt understand, Warren buffet does not invest in something he cant see value in, I think this is the smartest rule to have. understand the who what when where why and how, then worst and best case etc. this will arm you for your future. also I personally believe the stuff the books say is half good half turd, so dont trust anyone or anything 100%
Also I dont overly believe in even visting properties, I mean if numbers add up, you understand the market and have appraisals done from good real estate firms and insurances and banks that valuate above purhcase price, who cares if you like the look of it (yes do your due dilligence, pest building etc)
Simple answer; if you do that research well, your going to have a moutain of knowledgeGuest
Interesting you mentioned Nathan Birch, though I feel bit suss about him didn’t at first but he contradicted him self in one of his videos. Also yeah I do, do it. Though according to Nathan he got financial freedom at 23 I think he said and hes been investing since he was 18, so 5 years hopefully I can accomplish something in that time frame would be awesome, wouldn’t meet my goals but should be enough to live comfortably. Thanks.
how did he contradict himself? can I see links? I am curious now.
Well, I would say unless you are already well ahead of the ballpark in various aspects 5 years is a strech in most circumstances, but maybe your rolling in cash, good job, low yearly expenses.
would never say it cant happen. but I would just say be open that it may not ban out that way.
and to be fair, Nathan caught a wind that was outright his control that went his way and gave him a massive boost. not to discredit him in any way.Guest
Ok here is the video he says he earns 200k in passive income:
1:13 He says he makes 200k in passive income. 2 years later on this video:
He says he makes 2m fair enough before tax and that but he says 500k ( I can’t remember if its this video he says after tax and that he makes 500k but he definitely said it ). How is it in less than 3 years he is able to make 300k extra? Seems fishy to me, I could be wrong or missing something but this is all the info I got.
Ok I am lost with how your proving him wrong haha. or lying.
The video post are bothh in 2014, also he could have been reputting earns back into his portfolio (most likely) to build equity. this dosnt seem fishy at all to me, as its part of a good stratergy (sometimes) 50 cent the rappers, earnt nothing on paper when he was going through a divorce but hes worth 100m+
I didnt hear or see anything Contradicting? and seeming fishy and being fishy is different.
I think his model of operation is really simple and works well
1. buy under value, with incredible rent return
2. add value and increase rent
3. use equity for another quick purchase
4. repeat, repeat repeat!
many people have done well with this, many have lost lots because of varous factors.
this does in no way seem fishy to me. unless you can share actual evidence I find it hard to see where your coming from.Guest
Ah ok, I might of gotten it wrong then my bad. Maybe contradict was the wrong word to use. I just thought how less than 3 years he had gotten 300k extra per annum. To achieve that don’t you need your properties paid off? Or most of them at least?BennyModerator@bennyJoin Date: 2002Post Count: 1,325
To achieve that don’t you need your properties paid off?
No need for that at all. If you meet your current obligations to the lender, then any remainder is yours to do with as you see fit – and that COULD be used to pay down debt, or take a world trip.
Re HOW it can be done, I would think Nathan’s videos should give some clues. Where one is paying bank loans for around 4% and receiving a 10% return, you are making money hand over fist. e.g. If you have a property costing $200k and getting $400/week rent, you are pretty much there. HOW that can be done is a whole ‘nother story – suffice to say it can be.
Take another detailed look at Westnblue‘s effort – in just a couple of years, he created a portfolio worth close to $2m, with $200k gross per year, and after paying mortgages, and other costs (rates, insurance, etc) he still has a chunk of change to live on.
How well did he go in the next 4 years or so? Well, I haven’t seen it itemised, but from the sound of his recent update, he is doing pretty nicely. Have a read (and yes, it is the same thread I would have included in my welcome message to you):-
Check out the various posts in that thread of Darryl’s – some of them show where and how you can buy a copy of that 2013 magazine so you can put Darryl’s words from his post together with the words in the magazine and draw a pretty finely detailed picture of HOW he did it.
And, if his way suits you, why couldn’t you be the next “up-and-coming property investor?” If his way doesn’t suit, there will be other ways that are “you” – you just need to read up and find what suits.
Ah ok I see now. Thanks for the info.
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