October 09 ~ I never expected…
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PERSONAL UPDATE BY DEAN LETFUS
I don’t think things are over but we do have some stability at least and the shockwaves have subsided. The good news is we can really start to move forward with our investing as we can predict the future well enough to make investing decisions with minimal risk. In fact there is so much happening and things change so quickly that I have decided to keep in touch a bit more frequently with you, I hope that’s OK. I’ll drop you a (shorter) line once a week to ensure you keep on top of the things you need to know from here. Also I’m thinking of running an event in Auckland 21st November YAY!! I have lots to teach and share with you, in fact I think I am more qualified to teach now than ever before. But I’d love your feedback on what you are really struggling with and would like to get answers to. Just click HERE to go to the online version of this newsletter and make a comment at the bottom. What is your biggest current hurdle? If there was one key you would want to learn to move forward faster what would it be? In other words how can I help you achieve the life of your dreams through property. Tell me and I’ll teach it! So as I always say, Stay Inspired and stay safe as always
PS, you will see a few changes to layout and style of the websites and newsletters over the next few weeks. I am moving to a whole new level with keeping you all educated and inspired so want to do things “properly” and have engaged a wonderful marketing IT guru to work with me to bring you the best education and information on the planet, right to your inbox and web browser!!
PROPERTY UPDATE BY DEAN LETFUS I discussed at length with my webinar mentoring clients last night about some critical factors to consider going forward. For the full details you will need to join the PropertyMentoringSecrets team but what I do want to share with you is: Highest Probability and World view: Let me give you 2 pieces of advice based on my experience, research and survival of the current recession. 1. Highest Probability. Any investing decisions we make now in anticipation of the next say 3 to 5 years must be made on the basis of likely outcomes and highest probability. Now that is a moving target I freely admit but I want you to really think about this. What is a really likely outcome for property investors over the next 2 to 3 years and how would that affect your investing decisions? I’m glad you asked! My belief is this A: Further drops in property values in New Zealand AND Australia. We have the UK and the USA printing money till they run out of trees. They are both basically bankrupt. This must come back to bite the entire planet and property is going to suffer. In addition we have had ridiculous tax laws just introduced which will move investors into other asset classes further taking any recovery heat out of property B: Drops in rental income. Unemployment is going to rise for another 12 to 18 months and people are moving back home, vacating over priced rentals and generally contracting their wallets. Smaller towns will be hardest hit C: Housing and investors are likely to remain IRD/GST targets and we could see some unreasonable legislation happen to hammer the nonexistent evil property investor or developer Now OK that all sounds terribly negative but it is a highly likely scenario. I read what I’ve just told you and rejoice because it has OPPORTUNITY written all over it for you and I as sophisticated investors . I’m just trying to paint you the picture not tell you to get depressed about it 2. World view: The second thing I want to tell you to do is assume a paranoid world view. Not to cause you to stop investing but to ensure you stay safe. So assume the following: A: You may well lose your job. You must review your portfolio and your buying/trading rules to allow for your impending unemployment. Only undertakers and nurses are safe industries, anything else you could get the chop. B: Interest rates are going to rise so assume your current cashflow will be eroded by non paying tenants, high interest and increased vacancy. C: IF we understand all of the above and take the right sort of action over the next 12 to 18 months we will get to enjoy the boom that is coming and see our early retirement dreams become a reality. BUT ONLY IF WE LEARN FROM THE PAST AND PLAN FOR THE FUTURE NOW FINANCE UPDATE BY KRIS PEDERSEN:
Interest Rates Did you know that rates over the last 10 years have averaged approximately 8% per annum??? Now if you keep an eye on the headlines you will have seen titles like “XXX Bank cuts interest rates“and “Home loan rate cut to lowest in 40 years.”Note that with interest rates, that which goes down must come back up at some stage so there are large benefits from paying attention to rate cycles as you can end up paying a lot less interest. For example if you have $1m of mortgages and can beat the average rate by 1% over a 10 year period that is $100k that is kept in your pocket. Not to be sneezed at is it??? If you have interest rates coming off or anything else you want to talk about please contact us here. MINDSET SCIENCE BY DEAN LETFUS You know sometimes you know something but never knew that you knowed it and suddenly it hits you between the eyes? I’m sure you have. So this week I was driving and suddenly I saw many of my clients and event attendees in a new light. It was quite a revelation. What I realised was that so many people hear the success stories of others or see people get financially free and they embark on a journey to emulate it. However if they don’t get the right help they often find themselves confronted with things they have to do, financial commitments they have to meet and stress they have to deal with, without the necessary preparation and without being given a chance to decide if this is what they wanted. You see getting rich slow is just as good as getting rich quick. Who cares if it takes a little longer. And buying 100 million dollars worth of property in 4 years like I have done is definitely not everybody’s idea of a good time, (sometimes it isn’t even mine). In fact Raewyn and I consider some of our greatest “successes” with clients has been to get them to a point where they realise that actually property isn’t their thing. They can still use property to achieve their goals but they can do it passively rather than setting themselves up to fail through pressure and fear. It is easy for conservative and risk averse people to feel second class and even stupid when they enter the property investing world and that is both untrue and very sad. I have found that the most risk averse person can find ways to move forward with the right help. And I know, I’m married to the most risk averse person in the universe. So be true to yourself. Think about what you do and don’t like and can and can’t stand. Life is about growth but it is not ALL about personal development. Spending all our lives trying to get comfortable with things we will never be comfortable with is hardly a successful life now is it!! |
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2 Comments
October 15th, 2009 at 10:00 am
Sourcing and building a team of responsible and proactive professionals to enable us to confidently invest in areas outside of our hometown – this has been our greatest challenge. Any tips on this which would assist us in our mission to have a “turnkey” property system would be greatly appreciated
October 15th, 2009 at 6:27 pm
Just met with Kris Pedersen and drawn up an investment plan: how do I get finance for my next deal? Kris has identified two strategies: trading and joint venture. JVs make the most appeal but how do I find someone who has the equity to go with my good serviceability? I know the “what” and the “why” so I know I can solve the “how”.