The goals, vision, and habits you need to be a successful property investor.
So many people want financial freedom… but most do not take action in a big enough way to make it a certainty. Aiming for financial freedom, where you have more money than you know what to do with, is not quite the right goal for most people. It’s too out of reach. What you should aim for is financial independence. Where your annual expenses including all mortgages, insurance, food, holidays, parties, etc are covered by annual recurring income – from property, business, shares or other investments. If you can build income streams that are passive (do not require much work from you) it will mean your time can be spent how you like.
If you can identify now how much it costs you to live each year, you can work out your end goal and reverse engineer how to get there. Let’s say you need $100,000 a year for your family to live off if you have your mortgage fully paid down. This will be the good life you think.
Just work backwards from $100,000 to where you are now. Let’s assume you currently have 1 rental property bringing you $10,000 cash each year (rent incoming less the mortgage). It is obvious you will need to keep buying property investments if you wish to increase your annual income and have an emphasis on cash flow. Without knowing your age, income, stage in life, assets etc, we have to generalise here.
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The main thing you must have is a mindset of acquiring cash producing assets and investments over the time window you have, whether this is 1yr, 5yr or 50yr, you must create habits that keep you focused on your income goals. Set up emails from trademe and realestate.co.nz that send you property info that meets your buying criteria. Review the properties and stay up to date with areas of interest. If you can keep buying properties at a discount, the yields (positive cash flow) will enable you to reach your financial goals faster.
Pick up some property investment books. You can learn decades of property investment lessons from 1000s of property transactions in a matter of hours if you just read the books written by the experienced investors. You do not need to pay for a coach. Spend $100 buying 3 books and dedicate your leisure time to the pursuit of financial independence.
Unless you surround yourself with friends and family who share the same dreams as you, unless you focus every week on building up your property knowledge, unless you learn about your target markets and take action, it’s not likely you will reach your passive income goals. It might not seem like you are making much progress but keep faith in your processes and work with mentors who will keep you accountable.
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Now you know your passive income goal, a lot of people are wondering, should I invest in stocks or property. There is a great article to read right here which details the pros and cons of both approaches.
Alternatively, if you would love to see what real estate options you have. Take the mortgage snapshot which automatically calculates your purchasing ability, potential mortgage savings, or ability to top-up your mortgage.