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Investing: How did you start?

Discussion in 'Investing Strategies' started by Jacque, 26th Aug, 2005.

  1. Jacque

    Jacque Team InvestEd

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    I thought this might be a good place to begin a thread on how you got started in investing and an opportunity for those members who haven't yet posted, to just say hi and share a little about themselves.
    Even if you haven't begun investing, but would like to share your goals/aspirations, we'd love to hear from you :)

    As for me, most of you would have already read my profile so I won't bore you with more details. Suffice to say that I love property as an investment vehicle (for those who haven't guessed!) and have been interested since a starry eyed 24 yr old :)
     
  2. vickic

    vickic New Member

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    Thanks for your post Jacque. I'm fairly new to investing and am thinking about buying my first investment property. I have been looking at a range of options but am interested to hear what your thoughts are on buying an apartment from a plan. ie. do you think these are sound investments and what are the sort of things I should look for when considering this type of investment.

    vickic
     
  3. Mark Laszczuk

    Mark Laszczuk Well-Known Member

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    Well, I got seriously interested in investing after meeting my ex-girlfriend. I had already looked into investing, but more as a 'have a decent nest-egg inretirement' thing. She told me she wanted to be wealthy and that got the ball rolling. Five years (five years! where did it go?) later I'm doing quite well, thank you very much and now working in the industry as a paraplanner.
     
  4. coops

    coops Member

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    Funnily enough we started after my husband talked me into going to one of those free "how to become a property millionaire" seminars. I suddenly understood that we were sitting on quite a bit of equity in our PPOR which we could utilise to get started - we didn't actually need heaps of cash.

    We didn't buy any properties through that group as we were more comfortable finding our own, but it just goes to show what you can learn if you keep an open mind and listen to other people's ideas.

    I was so motivated and eager to get started that I could hardly sleep for the next week going over and over it all in my mind. Once I reasoned everything out and we decided to buy our first property there was no turning back. It just felt right.

    We then read everything we could about investing, joined the Somersoft forum and heard of Steve Navra through the members there. This led to doing Steve's course and we went on to put some dollars into the Navra retail share fund and invested also in Navra shares.

    What I would like to pass on to those who are looking to get started is that we have purchased 5 investment properties and have done so in spite of the fact that we are on quite low incomes. We had worked hard to pay for our PPOR and that gave us our start, so although it might take a while to build up your portfolio there is no time like the present to begin building wealth. You don't have to go out and purchase your dream home first up - start with what you can afford but at least make a start.

    PS - Go out and buy Jan Somers book "More Wealth from Residential Property" today - $30 well spent.
     
  5. Mark Laszczuk

    Mark Laszczuk Well-Known Member

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    coops,

    I've heard this many times over in the time that I've been an investor, but I tell ya - it never gets old!

    Mark
     
  6. Alan

    Alan Well-Known Member

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    When did we start?

    My wife and I were heading up to Fraser Island to do some 4 wheel driving and we stopped at.........hmmm........I think it was Port Macquarie. I went into a bookshop and started looking through this strange little book called 'Building Wealth through Investment Property' by Jan Somers. Anyone heard of this woman? ;)

    That was it! The book opened an interest that has stayed with me ever since.

    I find it interesting when you hear some say they've had an interest in money or investing since an early age. That was never me. I don't know how big a part your background plays in this but for whatever reason it just wasn't ever on my 'Top 10' important issues list. Maybe I looked at it very simply that being super wealthy meant you could buy a house with 10 bedrooms and 7 toilets, but really how many toilets does one person need? :confused:

    My attitude and motivation has gradually changed.......

    I don't see wealth as an end it itself but rather a useful tool in allowing you choice and time options along the journey. Money may not necessarily give you more time on this earth, but if used wisely, it can allow you the time and options to explore many more interests and passions.

    As the journey continues, you invariably meet others with similar intersts who help in many ways and hopefully you help a few too. Some may not be as far down the 'investment road' as yourself, while others open doors of thought that you wouldn't have imagined.

    For example, Steve (of NavraInvest fame) has certainly been a major ongoing mentor who has 'stretched' my thinking in many ways. I'm not sure how many questions I've bowled at him over the years but invariably he bats back an answer that adds to my understanding or he deliberately gives me a question to take away and think about. Many of the posters over at the Somersoft Forum have also added to my understanding on a multitude of issues. That place has been an amazing Site for distributing information and I hold high hopes that this Site will have a similar future.

    Let the journey continue.......


    :)
     
  7. perky

    perky Well-Known Member

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    :) I bought my 1st IP at 21 with my younger brother(in early 89) for 79k in Waratah (Newcastle) - it was a shop, they paid good rent (also council and water) rates.
    We paid it off in 4 years , even though interest rates reached 16.9% at one point. Sold it in year 5 for 97k. It was a small profit, but the enforced savings was good.
    Next off bought first PPOR at aged 24, and a gold coast IP at 25 - which did nothing for 8 years. Fortunately over the last 3 years it doubled from its lowest point (when it was about 25k under what I paid for it) - sold it last year and put that money the PPOR.
    That IP held us back for many years due to its failure. However 3.5 yrs ago felt the need to buy IP's again, managed to convince the wife and bought an IP in Kellyville. Since then have bought and sold another 4 IP's, so have had some fun :D
    Now have some money in the wholesale fund, and bought some shares in NavraInvest (and some more soon :) ) so looking forward to the next few years and seeing Navra keep outperforming the ASX200 :D :D
     
  8. mikhaila

    mikhaila Member

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    I came to Australia in mid 1994. I started to earn reasonable money (i.e. top marginal tax rate by 1996-1997) and was seriously concerned with the level of taxation :mad: . I casually asked accountant during my annual visit what I could do to pay less tax :confused: . He, fortunately, casually replied to me “Buy an investment property”. So I did. That is how it all started for us :D .

    M.
     
  9. Bob

    Bob Well-Known Member

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    how did u start?

    In 1990 I read alan falkner's book "investing in residential property on a budget" which was about property cycles so I decided to purchase a 2 beddie unit in Canberra, that seemed to go ok so I purchased two more, anyway shortly after that the liberal govt. slashed the public servant (thanks John) and the property market went south, anyway the rents were still there so I there wasn't much I could do. I made up my mind to keep going and purchased a property on the Gold Coast, then that market went sour and the price of that property went south...hmmmmm. Soooo, I thought as the market at the Gold Coast is way down I purchased two more properties. The rents were coming in so I decided that I'd start purchasing lease options which I did in Brisbane at Highgate Hill, Caseldine, Narangba and now Maryborough (I've forgotten a few). The positive incomes from the lease options were good so I thought Brisbane would have some growth so I purchased a neg geared property at Northgate which was offset by the pos gearing of the lease options. I sold two of the properties in Canberra when the market was buoyant a few years ago and have purchased a townhouse here in Sydney thru a HDT. I since then have purchased some pos geared rural properties in WA....
    I think I've done just about everything wrong but it still works.... so the bottom line is do something, anything, just make a start.

    Bob
     
  10. TakeStock

    TakeStock Well-Known Member

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    Hi Vickic,

    There are so many 'depends' in answering your question...ie where is it, how much, has the developer got a good track record, what are nearby apartments selling for etc.

    I personally am not a great fan of buying an apartment in a large development if it doesn't have much land content ie in a high-rise. Particularly for a first investment, I would be more comfortable with a house or a unit in a small block.

    Buying off the plan is certainly a popular strategy when you're in the middle of a property boom (such as several years ago), however, I would be more cautious now.
     
  11. TakeStock

    TakeStock Well-Known Member

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    Hi Coops,

    Isn't it a wonderful feeling when it all just makes sense, and you realise for the first time that you really can change your circumstances for the better. All you need is some knowledge, a dash of motivation, a pinch of acknowledging your strengths and a full cup and a half of get up and go (action).

    Well done!
     
  12. Qaz

    Qaz Active Member

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    My friend suggested I read Robert Kiyosaki's "Rich dad, Poor dad". So I went to the store and bought a copy. I was allready semi interested in investing, but that was the first time I really saw it as something that was worth doing and would actually give me something worthwhile.

    Ever since then, i've been hooked.
     
  13. Jacque

    Jacque Team InvestEd

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    Hi Vicki and welcome to the forum :)
    As has already been mentioned, there are so many variables to consider with off the plan purchases. The main issues, as I see them, are the track record of the developer and builder along with the contract. It's vital to get a solicitor who's familiar with these sort of contracts to read it through before you sign, so as to be sure about your contractual rights.
    The lack of control can be a deterrent with this type of property purchase, and the fact that you are basically paying a set price on something that isn't yet built. Is there a demonstration unit that you can view as to get a clearer idea of what finishes and fittings will be included? It's always so much harder to visualise a property simply by viewing plans. Ask to see other examples of the developers work. Speak to the tenants/residents if you can, to see if they are happy with the finished product.
    I would also be wary of buying in a generic highrise, as the land value content is going to be generally less than 30%. Stick to apartments that retain this 30% if you can, as it is land that appreciates after all :)
    In my travels, I did find this list of inclusions that should be in the contract itself. I'm sure it's by no means exhaustive but should provide you with a start anyway:

    A copy of the draft Strata Plan showing the lot and any garage, car space, storeroom etc.

    A scale plan of the interior of the unit showing internal improvements, as well as a schedule of all finishes and appliances.

    A copy of the approved plans and specifications, including description of title to be registered.

    The obligation of the vendor to construct using new materials, in a proper and workmanlike manner and by a specified time/date.

    A specific obligation on the vendor to construct the building and to commence construction within a specific timeframe.

    A mechanism in the Contract to deal with "variations" (these are important as they may vary widely and you need to read the fine print carefully so as not to end up with inferior substitutions)

    A dispute procedure.

    A rectification provision which typically provides for the vendor to rectify defects which arise within a set period (usually three months) but excludes shrinkage or minor settlement cracks

    Provision for the developer to supply details of building costs to facilitate a depreciation claim against income by the purchaser.

    Home warranty insurance- is this included and, if so, is it adequate?


    Do the appropriate groundwork and ensure you are getting value for money. Buying off the plan can be risky (just like any other investment) but it's your due diligence and attention to detail that will allow you to make an informed decision here. Happy digging!
     
  14. Jacque

    Jacque Team InvestEd

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    You're so right there, Bob. Opportunities won't come to those who sit and wait for them :)
     
  15. Steve Navra

    Steve Navra Well-Known Member

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    I was just 16 years old and very lucky to be elected to go to New York as a Rotary exchange student. I came from a family that never discussed investing at all . . . so when I met the American family who were very into investing and finance (The father was a stockbroker) it was an eye opening and life changing event for me.

    We went to college (school) in Manhattan and got a ride back home at the end of the day with the father . . . so I spent an hour at the end of each school day watching the close on Wall Street. (You used to be able to sit in the gallery and watch the chaos back then.)

    On my return home to South Africa at the end of my 16th year I started buying gold shares with every dollar (Rand) that I earned from teaching children chess. (Alan, where did you glean this info from :confused: )

    Gold went to $1,000 per ounce . . . and that has led me to where I am today :)

    Ahem via NY - Syd - ACT - Syd and loving every moment of the journey I (we) am / are all on.

    Regards,
    Steve
     
  16. NickM

    NickM Co-founder Staff Member

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    As a motivated 21 year old straight out of uni and into my first job in a Chartered Accounting firm, i dragged my brother in law up to Qld with me to go halves in a property.

    learnt very quickly about the pressures of agents as at the time we could have got an airfare paid for by the R/E agent to go and look at their properties. We declined and did our own thing and bought a 3 br house in Palm Beach.

    Sat on my hands for quite some time.

    I soon began to see the money made by some clients through real estate and thought, here i am advising them but with no real investing experience.
    Made the decision to do something about it.
    So i then plunged head first and havent stopped !

    NickM
     
  17. Medine

    Medine Active Member

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    When I was 22 my Nonna died, and left me $20,000. I went out and found a little flat in St Kilda, and got my Dad to bid at the auction. I was so chuffed when it was mine!

    I told my friends, and they said:
    "WHAT!!?? You got $20,000 and you bought a MORTGAGE?!". Apparently I was supposed to buy a new car.

    It took a few years to earn enough to be able to afford the next house, and by then property investing was much more talked about, so luckily my new friends don't think it's is so strange.

    Cheers, Medine
     
  18. eddievanhalen

    eddievanhalen Active Member

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    Apart from being the world's most influential rock guitarist :p ....started my investment education in my mid teens and have been on a very focused journey to learn all I can about all aspects of investing ever since, with a particular focus on the stockmarket. I still have plenty to learn about property development and tax/legal structures (even though I have trusts going etc.......)which has been the target of my hunger for learning the past few months.

    Having finished uni almost broke and qualified as a pharmacist I worked the long hours/low pay thing that most pharmacists do and quickly realised I was on a hiding to nothing. So I became even more focused on early retirement. Being the conservative fella I am I put my 10k of savings into the futures market :cool: . Having previously concentrated on learning about fundamental company analysis this was a very new experience , and although only moderately profitable , the risk management skills I learnt the hard way were very valuable.

    In the year 2000 (aged 25) I decided to quit the futures market. I had a negative view on the stockmarket at the time so decided to put the 40k or so I had saved into 2 properties- one PPOR and one investment property. All this time I was investing puny amounts into stocks as I had always done and developing/testing trading philosophies. In early 2002 I had my investment property revalued and drew down equity for my main goal - implementing my 10 years or so of learning and experimenting to become a fulltime trader/investor with a decent capital base.

    During 2002-2003 I traded the day away and worked pharmacy shifts from 5 til midnight to pay the bills so as to conserve my trading profits.

    Since early 2004 (age 29) I have been retired from the workforce (although I put in 12 hrs a day minimum in my "retirement") and that 40k of net assets in 2000 has become a 7 figure sum in 2005

    I enjoy corresponding with other serious investors and therefore expect to enjoy my time on this site .

    Ed. (InvestEd :D )
     
    Last edited by a moderator: 31st Aug, 2005
  19. Jane

    Jane Active Member

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    Kick Off!!

    Hi Guys and I must say I'm excited that this is my first post (lazy, no, extremely busy, yes - as we all are).

    I started by accident in 1988/89 when I had a PPOR that went through the roof at the time, then sold and bought PPORs. Like Steve, I had no investment influence from my family, particular not property. I was working hard in a day job but always had knew there was something else for me. Now, I'm a bit of a procrastinator, but after meeting like minded people along the way, and making decisions to go to meetings and seminars, I can say that after 8 years, we have done a number of different strategies with property and yet another one at present.

    It's all good fun, I love the learning curves and especially the people I've met along the way who are all positive and gracious.

    You got to start sometime, and now is as good as any. ;)
     
  20. Maggie

    Maggie New Member

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    I started by believing that I must own my PPOR, never rent and pay off PPOR. This is how I was raised. I'm glad because my husband and I bought our first investment property that became our PPOR and we paid it off.

    My investment beliefs have changed since first property purchase, we now rent, own multiple IP's and invest in Navra's managed fund.

    We continue to educate ourselves and meeting Steve Navra has definitely put us on the right path in meeting our financial goals.