An interview with Property_Girl

[property_girl]

[*]What gave you the hunch that the southern part of Canberra would do well?
[*]And how on earth do you manage to pay them off in a few years? Especially at the beginning - even with a high income? How about without a high income?
[*]Do you go fixed or variable or no-rules or blended or ...?
[*]At what point did you determine that you were doing well enough to live off rents?
[*]And does your position improve over time?
[/LIST]

1. I knew that self-government would come with more development opportunities; that self-government would want in-fill; and that prices in inner suburbs would go up as the population grew and people wanted to live close to the city.

2. I started saving money very young, and I kept saving. I have had a couple of periods in my life where I have had a high income. They are the times I have been able to make leaps forward. With a low income, you just have to slog it out. There are probably smarter ways of doing it than I have done it, but I am very conservative in my approach and don't like risk.

3. I have never had a fixed loan; always variable. I pay my ppties off as quickly as possible. An 'expert' did tell me in the late 1980s that I was crazy not to take out an interest-only loan. I know that's what some people do, but I don't.

4. A couple of years ago started grossing more than $100K in rent. That's enough for us to live on.

5. Yes, definitely--your position improves over time. For me, time has been the factor that has helped the most. The rental income has been the icing; the capital growth over time has been the cake.

 

[z611143]

You say you've been aggressive in paying off your property, yet alot on here that are also experienced and successful say to only pay IO and save for another IP. Also been reading Peter Spanns book lately and he echos similar thoughts to IO and saving for another IP ect.

Has paying it off aggressively done you well?

 

[oc1]

You say you've been aggressive in paying off your property, yet alot on here that are also experienced and successful say to only pay IO and save for another IP. Also been reading Peter Spanns book lately and he echos similar thoughts to IO and saving for another IP ect.

Has paying it off aggressively done you well?

Read Point 4 above. If $100k in rents with no debt isn't a success than I don't know what is.

Well done PG!

 

[z611143]

Read Point 4 above. If $100k in rents with no debt isn't a success than I don't know what is.

Well done PG!

Just read that after i posted.

Im not by anyway saying PG isnt successful. I was more asking if in now hindsight doing IO may have served her better? Its probably a difficult one to answer

100k gross is amazing especially with no debts to pay off - RETIREMENT WITH EASE!!

 

[oc1]

Just read that after i posted.

Im not by anyway saying PG isnt successful. I was more asking if in now hindsight doing IO may have served her better? Its probably a difficult one to answer

100k gross is amazing especially with no debts to pay off - RETIREMENT WITH EASE!!

I agree, hard to tell. The end result is a good one though. Sure beats living off equity! Give me recurring income anyday.

 

[DaveM]

You say you've been aggressive in paying off your property, yet alot on here that are also experienced and successful say to only pay IO and save for another IP. Also been reading Peter Spanns book lately and he echos similar thoughts to IO and saving for another IP ect.

Has paying it off aggressively done you well?

Depends on where you are in the investment phase. Accumulation or debt paydown.

 

[property_girl]

Just read that after i posted.

Im not by anyway saying PG isnt successful. I was more asking if in now hindsight doing IO may have served her better? Its probably a difficult one to answer

100k gross is amazing especially with no debts to pay off - RETIREMENT WITH EASE!!

I totally agree. Had I done it differently from the get go, I would have many more properties. I'm not saying mine is the best way to do it. It's what I did because it's what I knew. I am really risk averse also. I have seen friends lose everything when interest rates rose and they couldn't service their debt.

As I said, I have never read a book or attended a course on property investing. I know that there are many knowledgeable professionals out there who know their stuff, but there are a few that don't, or they change their minds a few years after they've given advice and thousands have acted on it. I would rather educate myself and make my own decisions.

 

[MTR]

PG

Well, slow and steady may not be for everyone, but it worked for you, not too many investors will achieve this success. Good for you

There have also been many so called property gurus promoting LOE and just continue to rack up debt to their eyeballs. I too have seen some get burnt with this strategy, compounding debt is a sure way to lose your shirt. Market turns, LVR too high..... bad luck if you get wiped out.

I believe the rock stars of property investing today are now the developers, everyone wants to be a developer. I can see many who will get burnt with this one as well, unless they are prepared to go slow, learn and take responsibility, don't pass the buck, sure why to lose your money.

Enough of my ranting...

MTR

 

[S1mon]

cheers for the interview PG

your ACT land tax and rates bill must be impressive!!...(and eating into your cash flows the last few years?)

 

[Nattl3s]

Thanks PG! Love reading these positive stories . Slow and steady sounds like my current pace. Cheers.

 

[MIW]

Thank you all for your kind comments. WattleIdo, I will pm you. MTR, yes I would never have done it without my father. Even though he is Italian, he was a feminist before his time.

Honestly, short but to a point interview! Thank you for the insights on starting, even when not understanding it all, and constantly learning.
I too was a very conservative investor, good saver, and never drew on equity to buy another. One person once said to me, "Wow you did it the slow way!". Well, I have no regrets, as you pointed out, time and market forces will do its thing, if bought well enough, right? Also, the positive Cash Flow (I like the term - icing) and the Capital growth (I like the term - cake), make it all worthwhile too. Like you say, what other property experts recommend is great but we should stick too what works for us!
I saw recently a show on TV where it was mentioned that first generation Italians were the most property holders in AUS, so I was wondering where your background was from... you answered that question.
It is so inspiring to me that you have used the knowledge your parents have passed on as that's my wish for our kids too!
Thank you for sharing and inspiring!

 

[willair]

Thanks for your time to post your story,and by the sounds of things as we have 4 daughters but who have invested in the equities markets,no property yet,and as your Father sounds like a Man of thought and action which was passed onto you at the dinner table each night,he would be a happy Man looking back..
But just from the sidelines as I bought into "CBA" in the second listing in the mid 1990's for $10.45 in the final instalment payment ,I have reinvested dividends from day one,when you say investing in CBA was there a listing 30 years ago?..



Quote..
Later I purchased CBA shares. All the dividends have been reinvested for the last 30 years, so I'm very happy with those shares.

 

[Blacky]

But just from the sidelines as I bought into "CBA" in the second listing in the mid 1990's for $10.45 in the final instalment payment ,I have reinvested dividends from day one,when you say investing in CBA was there a listing 30 years ago?..



Quote..
Later I purchased CBA shares. All the dividends have been reinvested for the last 30 years, so I'm very happy with those shares.

Nope... it was publically listed in the early 90's. The gubment sold out in 3tranches (I think) between early 90's to mid90's. So not quite 30years ago.

Blacky

 

[Xenia IM]

Congratulations PG
This was a great interview.

My dad was also a self made millionaire (still is) and purchasing properties was just a logical step you did at 19.... It wasn't until I got to uni that I discovered that it was not so logical or natural for everyone else.

Well done again on the interview and continuing success.

 

[ellejay]

Amazing success PG. Thanks for posting the interview and for your posts on ss. Keep up the good work