They Don't Listen......or Leaving it too Late

The other complaint that annoys me is when a renter thinks that they should be able to afford to buy a property in the suburb where they are renting. The same rent money might buy them a property in a cheaper Sydney suburb, but "it's not fair" that houses are "too expensive" in the suburb where they rent. Those vendors are "asking for too much money," and "it's not worth that money" and "houses in Sydney are too expensive." Eventually they make this excuse for so long that they get priced out of the cheaper suburb too.

 

Who don't agree the Govt should give us more money? Even I am Member 2 myself (an aged version)...

 

I think a large part of the issue is most people don't have enough insight to recognise there is a problem in the way they are thinking. There is a disconnect between what they want, and their current understanding of how to attain it. Unfortunately, entitlement is also well and truly alive which compounds their issue and struggles.

There are also many people who have internal conflicts, eg, they want to grow wealth but don't believe its morally the right thing to do. So they inevitably do nothing.

Often, its the people (many migrants fall into this category) who come from other countries where they had on-going hardships and daily struggles etc, who jump head first at the endless opportunities countries like Australia offer. They have much insight into what having little money, no safe home or stable government really means. They need no convincing to take up all the great opportunities offered here including getting a great education, home ownership and employment opportunities.

 

I love a good migrant story. You take a good look at many of Australia’s most successful property investors, many you’ll find were migrants.
From having nothing to extreme wealth through hard work, some risk and a bit of nous . Pretty cool achievement really!

 

This threat resonates with me in trying to help families on so many levels. Over the years I have tried to encourage them to 'fish' for themselves (without much success), instead of me just giving them the fish! However, I have some friends who asked me - out of curiosity - about how to invest in properties and shares. I freely shared with them all the resources I used and encouraged them to research widely. One in particular married to a man with means, but he did not teach her anything about money. Now, her daughter owns a few properties - which she kept boasting about how proud she was. Needless to say, I was very happy for her.

 

What a fantastic post, thanks Skater.

It really is confirmation that real estate investing and perhaps investing in general, is all about mindset (yes, I know it's a cliche).

It reminds me of the old Anthony Robins saying that people think they lack resources, but they really lack resourcefulness.

I know it is a permanent question that people have about real estate on forums like this, but we really need to move past the "is now a good time to buy" question - which is really only ever a question that can be answered by the individual.

 

Agreed.

I think self-reliance seems to be a value that we have lost in the West, which is a shame. I think the response to Covid has revealed a lot about who we think we are as a society.

But I think the biggest problem is "present tense" thinking, with patience in very short supply and consequences to bad decision making thought to be unfair. Adverse consequences to bad decision making is an essential feedback loop to correct future behaviour, but we now think it is all "unfair".

 

Just going to say @skater, you are a real gem on this forum. You started with nothing, low incomes, started buying houses in untrendy areas (people looked down on them!) and did spectacularly with it over time. And the thing is, you were able to do this long ago and still can do it to this day. There is sweat equity, you gained so much knowledge along the way and are so willing to share it with the forum.

Was it easy? Hell no! But we can see what you’ve done, and it works!

Anyway, key tips for someone starting out, you don’t need to/possibly shouldn’t try to start with a $2 million house in the suburb your parents live in. You don’t need to buy in the in-fashion suburbs when starting out. If you do want it, you may be very disappointed…..

A lot of Sydney is expensive, but people can still buy in the cheaper areas and do amazingly with it.

so…. Thankyou Skater!!

 

Agreed.

I come from an average lower-to-middle class family and while we had some (a lot) of tough times, they are a joke compared to what I've seen others struggle through.

Simply by being born in this wonderful country already puts me at the very top rung of luckiness.

 

Yes!!
We wanted to buy in Baulkham Hills in Sydney but couldn't afford it.
We bought out west with the view to upgrade later. Friends/family said "Why would you move THERE?"
We lived there for 7 years, more than doubled our money. Friends/family were still trying to save a deposit as everything had doubled. When we started looking in Baulkham Hills one relative laughed and said "You can't afford to buy i Baulkham Hills". Should have seen her face when I told her I had enough for a 50% deposit. HAHA!
Live and learn!!

 

Oh, wow, thankyou @Gockie, I'm sure I don't deserve such praise.

I guess the thing is, that property investing is seen as a 'rich person's sport', nobody expects those on low incomes to do it, and even more so, really don't expect them to actually retire from it, but I'm not the only one that has done well from it.

Think back to SS days & there were a few of them. There's Brenda Irwin who was a school teacher & bought a heap of really cheap properties in QLD. Then there was Almost Bob, from Canada who specialised in trailor homes, I think it was. Eventually they moved to Australia for 6 months of the year and worked in outback towns during the colder seasons of Canada. A really interesting one was Rumpled Elf. She was from some shanty town out the back of SA. Bought really bad places & fixed them up & rented them out. Eventually moved to the 'big smoke'. Another small town, but much bigger than the others and built a new home next to the latest 'fixer' that they had, which was on a splitter block. She did amazing things with no money.

People put Elf & Bob down, because they weren't 'real' investors, but their stories were really inspirational and shows that if you have the will, and the drive, you can do it. Neither of those two post anymore, but I do have contact with Elf, and she's still doing inspiring things with little money after a brief set back. I know it's only a brief set back, because she's the kind of person who is like an Eveready bunny and just doesn't give up.

And you are right. You don't need to start out with the $2m property near all amenities. Great if you can afford it, but realise that if you are like the rest of us, you are not 'entitled' to live where you want to live. Live where you can afford to live, and maybe at a later date you can afford to live where you want to live.

 

That's right. You've (all of us) have won the lotto by being here, but we can improve it further by just stepping up to the plate and giving it a good hot go.

 

Hehe, nephew did the same. Bought a place in Lethbridge Park, despite being on a decent income. Paid it off. Few years later bought a HUGE place in Baulkam Hills with 50% deposit.

 

Finding this forum 4 years ago has been a godsend and has really instilled that the information that i believed we were being misfed by people before us who unfortunately fell into the proverbial rat race.

We did relatively the same thing, not as large scale. But we grew up in eastern suburbs of Melbourne, We would of loved to buy our first home there in 2016 but median prices were to high for the 3 bed 2 bath home you want to have a family in, We moved to officer, people joked "you couldn't pay me to live there" "How does it feeling being neighbours with cows". These people stayed in the area and bought one bed room apartments or areas on the fringes with not much growth. Fast forward 3 years later, officer nearly doubled in price, our ideal location dropped, we proceeded to sell officer and bought our large 5 bed family home in the original suburb with a 20 percent deposit whilst everyone is now stuck in there one or two bedroom townhouses. Fast forward to now and we have just had our first child and just had an equity release back to 80 percent LVR of 220k to look at an IP. These same people now are beginning to have families and are now having to look outside the area to find an affordable house to suit a family or will just have to rent.

From the day we made the move to purchase in officer i tried to explain to everyone who asked what we were doing and its a great way to do it, unfortunately no one listened or they waited until after we did it when it was already to late. I have found the mindset that comes to most people when talking about finance or houses its almost competitive rather than if we all helped each other and listened majority of us would be much better off

 

Some people want to listen, some do not.

You can lead a horse to water but you can't make him drink.

I'll share one of mine.
Had a friend who would call me up and talk about investing (they own their own home - so serviceability was not an issue).

Reviewed a few different properties with them, last one was about 4 years ago.
Good block for granny flat with its own frontage in Sydney (18km from CBD)
Did the calculations factoring stamp duty, renovations to existing house, build granny flat etc.
Cost of holding worked out to be around $5,000 a year after all costs (based on borrowing everything - ie using equity to fund deposit, stamp duty, renovations, new build).

They decided it was too expensive and was about $50k-$100k overpriced and also because it was negatively geared and they wanted positive geared.

I asked them a simple question - Do you think the property will go up by $25,000 in 5 years time. Answer was a resounding yes, but they still didn't want to proceed because it was "overpriced".

Fast forward to today, had they bought that house, done nothing, it would still be worth $300k more than what it was in 2017.

 

It's the effort that's irritating isn't it? A lot of us here love to help others and will throw ourselves at it. We'll spend days if not weeks helping them search, strategize, contact our network of people to get various balls rolling. Then they just go, nah, too hard.

 

im happy and regretful to admit, that had I literally bought anything that I made offers on and decided it was too expensive in my acquisition phase id be laughing all the way to the Bahamas

my parents ppor, they paid $350k for it, 4 bdr in a blue chip suburb 600sqm , had they spent $500k at the time which they did consider, they could have got a 2000sqm, 6 bdr, pool, castle, tennis court

fast fwd all these years, $350k is worth $2m, $500k is worth $4-$5m

I guess you could say the same now for anything, eg if you are looking at logan,
should you just buy at any cost? whilst each open has 70 unseen offers etc

 

I think investor is only a brand and wealth accumulator is the substance. Otherwise investors are nothing more than traders and gamblers, which is a fast horse approaching a cliff edge.

 

In my social circles I'm just a poor boy, in my investing circles I'm still the poor boy.
The difference is I've learnt to never talk business or investing with those in the social circle.
I don't even give opinions unless directly asked.

Because you don't talk about it much about it, you're not considered "successful" or an "investor".
And when you do, cause they never heard it before you got lucky.
And if you talked shared all the work and drama during the journey...most wouldn't be friends for long lol.
It's just how the process goes.

PS I remember those names, and there were a few more with non standard strategies.

 

But Do people really care, outside this forum? It can also be interpreted as preaching?? Good way to lose friends