What is your strategy?

I'm new to property investing and am trying to figure out a strategy. I know I want to eventually have a good income to live off the properties but am not sure about what way to do it. Whether I buy some properties and then pay them down with money from my job or I have heard of people buying a lot of properties and waiting for the values to go up and then selling half and paying off all the debt. So I was wondering what your strategy is?
 
As you mentioned, there are several ways, and you need to find what works best for you.

For us, we didn't start investing until our early 40s, and then bought aggressively, and in the span of 6 years, owned 40 units.
It was at this time (I was now 50) that I quit my job where I worked as a machine operator in a factory.($14 per hr, so not a high wage)

Our properties range from single family transportable homes to a couple of 11 unit apt buildings.
We own a few properties outright (the cheapies) and within 15 years, the rest will all be paid off.

In the meantime, we live happily on very little money.
We have no intention of selling.
 
I build multiple dwelling developments for positive cashflow and equity creation. Both add to your borrowing capacity so the effect, if you don't sell, is exponential wealth and hard work.
 
For residential properties you would be waiting a long time for the rental to cover the interest to live off it. Main aim would be to gain equity from buying well and then leveraging that equity for more cashflow positive investments.
 
Start a business to generate good cash flow.
Buy multiple properties and develop multiple townhouses on each to hold, business cash flow funds this.
Once accumulation phase over, sell business which funded entire portfolio and erase all property debt, no need to sell any properties.
Live off a very healthy passive income from an appreciating property asset base.
Timeframe from start to finish - 10 years.
 
Start a business to generate good cash flow.
Buy multiple properties and develop multiple townhouses on each to hold, business cash flow funds this.
Once accumulation phase over, sell business which funded entire portfolio and erase all property debt, no need to sell any properties.
Live off a very healthy passive income from an appreciating property asset base.
Timeframe from start to finish - 10 years.

Darn... you make it sounds so easy...

I'm just starting too Lauren, the strategy is very simple (similar to what you mention) but might change in the future. I also use the offset for IP to improve day to day cashflow (non-deductible debt has been taken care of)
 
Darn... you make it sounds so easy...

I'm just starting too Lauren, the strategy is very simple (similar to what you mention) but might change in the future. I also use the offset for IP to improve day to day cashflow (non-deductible debt has been taken care of)

much of it is...simple but not obvious

dont over complicate and get started

the IP side of it is the easier bit, the business side is harder for most

ta
rolf
 
Start a business to generate good cash flow.
Buy multiple properties and develop multiple townhouses on each to hold, business cash flow funds this.
Once accumulation phase over, sell business which funded entire portfolio and erase all property debt, no need to sell any properties.
Live off a very healthy passive income from an appreciating property asset base.
Timeframe from start to finish - 10 years.

Wow, thats a +1 from me........and Im in year 9! ;)


pinkboy
 
Darn... you make it sounds so easy...

I'm just starting too Lauren, the strategy is very simple (similar to what you mention) but might change in the future. I also use the offset for IP to improve day to day cashflow (non-deductible debt has been taken care of)

It certainly was not easy, this past 9 1/2 years following this plan.
But once you've done it, it is easy to repeat and improve.
The hard part is constantly pushing yourself to the next level, staying there long enough to make it become reality and normality, then pushing again for the next level.
Before you know it, exponential growth in all areas produces the results.
Do the things that are easy not to do, go the extra mile and success will be guaranteed once the right habits and attitude has been formed.

Why can something be so difficult for one person, but so easy for someone else?
 
the IP side of it is the easier bit, the business side is harder for most

ta
rolf

Yep, business can be extremely testing at times.
But the lessons learned and character built from these challenges are priceless.
Through persistence, the payout can be very rewarding both personally and financially.
It's a never ending learning experience, practically daily, even after 10 years in the same biz.
You won't get that type of personal growth and development in most jobs.
 
It certainly was not easy, this past 9 1/2 years following this plan.
But once you've done it, it is easy to repeat and improve.
The hard part is constantly pushing yourself to the next level, staying there long enough to make it become reality and normality, then pushing again for the next level.
Before you know it, exponential growth in all areas produces the results.
Do the things that are easy not to do, go the extra mile and success will be guaranteed once the right habits and attitude has been formed.

Why can something be so difficult for one person, but so easy for someone else?

Nice Ace, Kudos.

do you mind sharing what you do for a business? Im on a similar path to you. my focus is to develop and to mainly hold. i have a good paying job FIFO but won't to get out of it in a few years.
 
I'm new to property investing and am trying to figure out a strategy. I know I want to eventually have a good income to live off the properties but am not sure about what way to do it. Whether I buy some properties and then pay them down with money from my job or I have heard of people buying a lot of properties and waiting for the values to go up and then selling half and paying off all the debt. So I was wondering what your strategy is?


In the "buying more than we could handle, and selling off some to pay off the rest after a few hard years" group.

We started off by buying as many as the banks would allow us.
Worked multiple jobs to feed the negative cash flow.
Sold half the portfolio.
Paid of the rest with the proceeds.

The Y-man
 
In the "buying more than we could handle, and selling off some to pay off the rest after a few hard years" group.

We started off by buying as many as the banks would allow us.
Worked multiple jobs to feed the negative cash flow.
Sold half the portfolio.
Paid of the rest with the proceeds.

The Y-man

Thats the plan for me too!
 
My plan is similar to ace in the hole:

1. create good cash flow from business (for us its good income from a job that we view as a business anyway)

2. Buy investment properties (obviously buy well and all the rest of it)

3. Leverage of the equity to buy development sites and develop townhouses ect. Keep some and sell some (besides the bank wont let you keep all, you will have to sell some eventually. I think keeping some and selling some will allow your asset base to grow dramatically as well as enjoying the great cash flow profits at the same time. Really its the best of both worlds

4. Most, MOST importantly develop what I like to call a 'sophisticated mindset' which involves developing the right habits, attitudes, beliefs and view of fear etc in order to achieve massive success. This last condition is so important IMHO. 80% of the battle to financial freedom.

BTW we are actually doing this process and it works amazingly well. Lots of HAAAAARD work and learning but its so worth it!! There's no way we are working till 70 and retiring on superannuation/peanuts. No way in hell.
 
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3. Leverage of the equity to buy development sites and develop townhouses ect. Keep some and sell some (besides the bank wont let you keep all, you will have to sell some eventually. I think keeping some and selling some will allow your asset base to grow dramatically as well as enjoying the great cash flow profits at the same time. Really its the best of both worlds

Hi Leo,

I'd be keen to understand how to get started on the development path. I've just settled on IP#5, and up till now have been following the boring buy and hold strategy. Made some mistakes along the way, e.g. selling my first IP, but I reckon I've got the right mindset now to start looking to try more advanced strategies.

J
 
I'm new to property investing and am trying to figure out a strategy. I know I want to eventually have a good income to live off the properties but am not sure about what way to do it. Whether I buy some properties and then pay them down with money from my job or I have heard of people buying a lot of properties and waiting for the values to go up and then selling half and paying off all the debt. So I was wondering what your strategy is?

Great thread Lauren!

The reality is there are lots of options. We always try to buy well, in up and coming areas, combine with a (usually) easy cosmetic reno, hold for a while. This is simple to repeat a few times and get some equity in a short time. Then you have options, you have learned a bit, and you start to get a feel for what you want your long term strategy to actually be.

Re your job, if your income is huge then by all means pay down debt, but if its small its a slow way to build wealth. Leverage and inflation are your friend if you can safely harness some debt and use extra cash-flow to maintain buffers and then purchase more properties. When things get tight, sell one. Use profits to reinvest. Once you get going you will get a feel for what suits you most.
 
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