Thank you for the interview Wobbycarly. Here is the time line from your story. I don’t know why I always do this?!?
1996/1997 - Age 22 – Bought block of 4 1BR units
Before 2002 – Bought outer East of Melbourne (wife)
Around 2002 - Got married.
Around 2002 - Bought new townhouse in Brisbane
2002 - Age 28 – Bought PPOR
Started family.
2007 – Sold block of 4 1BR units
2008 - Embarked on first reno
2010 – Bought townhouse in Upper Coomera
2012 - Age 38 - sold PPOR and bought an upgrade
Is this correct?
Yep, that's about it, in a nutshell.
If so, having children stopped you for about 6-8 years. Is that be because of reduced cashflow or didn’t want to take risk or just didn’t have the energy/interest?
D. All of the above. Primarily, it was reduced cashflow. We went from renting with 2 incomes, to a mortgage on 1 income. I kept up my reading - plenty of investment books in the library - but had neither the cashflow nor energy.
You mentioned that “ ~$1M of investment “. Is that IPs only? (not including PPOR or other assets)
The 4 IPs are each worth about the $300k mark, so there's a bit over $1M in gross value.
I noticed that you always participate shares related posts and also you mentioned that you have <1% in shares. That is about 10K. Is that correct? Is there any particular reason for not investing more?
Yep - about $10k in direct shares and about $5k in an ASX200 tracker.
I managed to lose quite a bit of money during the 2007 crash. I was margined during this time too. So I've just slowly been building the portfolio again. I still have a lot to learn about
investing in the stockmarket, as opposed to trying to
trade. I have come to believe that these are two completely different activities, require different mindsets and skills.
One aspect for me, from a mindset point of view, is that I'm happy to hold a property for several years, but I have this 'block' in my mind that shares should provide "quicker" profit than property. This is something that I need to overcome; I need to develop patience in the market.
I will become more exposed to the share market, through direct investing, and will learn more about choosing investment-grade shares, but I have a bit to go yet.
The leverage in property is also very attractive to me, compared to shares, where I believe leverage is more dangerous. I've learnt the hard way, and expect to be a lot less aggressive in the future.
You mentioned “Living off rent will be difficult; the required level of unencumbered residential real estate assets to live off rent is substantial.”. You are only 38. Don’t you think you have another 25 years to come to that stage?
I often remind myself: "People generally overestimate what they can achieve in 1 year, and underestimate what they can achieve in 10." Yes, God willing, I have plenty more time, but I want to shake off the shackles of the wage slave as soon as possible - I don't want to WAIT for 25 years!
Thanks for taking an interest in my story, and I hope it helps.