I read some tips from a man, Nathan Birch from Australia who owns 170 properties in Sydney Morning Herald and I think it’s great to share his few tips here. I think they are good because we may be a little lost, a little blind, a little naive when we first started. Property investment is definitely not a miracle. Do it right, get good returns. Get it wrong, it will be many years later for recovery before we could try again. Oh yeah, he has net rental income of A$500,000, after expenses. His tips:
- Make sure you understand why you are buying your property.
- Set strong goals from the start and only accumulate properties in line with your goals.
- Don’t buy with emotion. It’s about numbers. Treat property investing like a business with no emotion.
- The three main keys when accumulating property: buy below market value; it should have an upside to growth and a good cash flow.
We may be buying our first property when we are young. That’s when we have a little more flexibility in what we intend to buy. We could take a little more risk, we could stretch the mortgage longer and we should aim for capital appreciation first instead of stable rental income with positive rental yield. Read here: Rental yields versus property price appreciation
What’s the goal? Buy one every year? That’s considered aggressive but definitely doable. Buy residential? If residential, buy high-rise? Buy landed? Why buy such property types? Landed may be better for capital appreciation due to scarcity but high-rise is definitely better for positive rental yields. Buy both? Sure, if you could.
Buy objectively. Buy a property simply because it could give good returns. Do not buy because you like the layout or the garden and pay a higher price for it. That future buyer may not share the same sentiment. Buying as low as possible is easier under current situation. Do take advantage of this and quickly view more and offer.
Whether Nathan started at a great time or was lucky is really secondary. He actually started as soon as he could sign a contract, at 18. Have we started today? Or still waiting for a crisis to strike before we start? The full article is here: Man with 170 properties Honestly, the best time would have been 20 years ago or the best time could be when we were younger. Read here: Start as young as you can Happy thinking.
written on 20Apr 2016
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