Buy and Hold Long Term Investment

[auckland investor]

Is buy and hold investment strategy too boring for most people.

Why not just buy a good solid home in a nice suburb and wait for 10 or 20 years.

When you pay down some of the mortgage then buy another home.

Home prices and rent prices will go up over the 10 or 20 years.

Why bother about Property Tutor seminars or get rich quick when you can get wealthy easily by buying and paying mortgage off and buying more house over time.

[Orkibi]

you can get wealthy easily by buying and paying mortgage off and buying more house over time.

Buying a property or having a portfolio with average yield of 3-4% is a waist of time IMHO - The aim with PI is to achieve financial freedom right?? so this = Cash flow coming in without going to work yes?

if you buy one house in AKL for $450k it will take you well over 20 years to pay it of (or at list for most people). and start getting cashflow.

High yielding properties would generate cashflow much faster.

Re mentoring and seminars, most people need that as a motivation and guidance to get out and take action.
they would not take action unless they didn't commit mentally and financially to the process.

Some wouldn't take action either way.

[Bob Kane]

Yep - buy and hold is too boring for the gung-ho types.
It's a very safe strategy and will deliver the passive cashflow to retire on.
It just takes a while to bear fruit.
If it suits your investment profile - go for it.

[flyernzl]

Why bother about Property Tutor seminars or get rich quick when you can get wealthy easily by buying and paying mortgage off and buying more house over time.

My strategy exactly.
I'm a very boring person.
The last house I sold was in 1979.

[damage]

Is buy and hold investment strategy too boring for most people.

Why not just buy a good solid home in a nice suburb and wait for 10 or 20 years.

When you pay down some of the mortgage then buy another home.

Home prices and rent prices will go up over the 10 or 20 years.

Why bother about Property Tutor seminars or get rich quick when you can get wealthy easily by buying and paying mortgage off and buying more house over time.

you make it sound so easy

A couple of questions;

1. Where are you going to get the money for this inital house from
2. Will the rent cover the mortgage
3. Will the banks lend you the money.
4. What will happen when historically low interest rates go up?

[Orkibi]

It depends How fast do you want to retire / be financial free, I want to be there sooner rather then later.
And that's why it is consuming my time now so we can get the results faster.

[Davo36]

Is buy and hold investment strategy too boring for most people.

Why not just buy a good solid home in a nice suburb and wait for 10 or 20 years.

When you pay down some of the mortgage then buy another home.

Home prices and rent prices will go up over the 10 or 20 years.

Why bother about Property Tutor seminars or get rich quick when you can get wealthy easily by buying and paying mortgage off and buying more house over time.

I agree actually Auckland Investor.

Most of the seminars are a complete waste of time. They never really go into any specifics, are often just a money making scheme for the seminar-holders and often just a way of them feeling superior about themselves. i.e. they stand up there and tell everyone how wonderful they are, and many in the audience sit there going "Ooohh, aaahhh".

Then of course they're usually selling some property project they're involved in (and get a kickback from) along with all the usual books, dvds etc.

But to address your main point about holding for the long term vs buying and selling: Well this is the conclusion I've come to. I've spent a lot of time buying and selling and latterly developing property. And you know what? If I'd just held onto what I had bought, I'd be much better off now. Just holding good property is the easiest (and fastest) way to build wealth.

[keleri]

Bought my first house in 1970 for $20,000. Rented for $25 per week. Now worth $380,000 and getting $365 per week. Bought several others and the same increases apply. Retired early and living on rents received. No day to day hassles about changing values, buying and selling and paying mortgage interest etc. Plan early and reap the benefits later.

[TheLiberalLeft]

often just a way of them feeling superior about themselves. i.e. they stand up there and tell everyone how wonderful they are, and many in the audience sit there going "Ooohh, aaahhh".

No, surely not. I'd always assumed that the "$25 million man"-type quotes were trumpeted from the podium simply to ensure the audience felt justified for being there and paying the entry fee. In other words, the speaker isn't just some snake-oil salesman fly-by-nighter, but rather is there for the long-haul, is experienced and honest in an "if I can do it so can you" way.

[auckland investor]

What sort of real estate is best for long term buy and hold investing?

I would think 3/4 bedroom house in desirable suburb in main city such as Auckland, Wellington.

[Rosco]

I'd definitely look at Auckland
- Higher immigration
- Apparent shortage of houses
- Apparent rental shortage

In my opinion Auckland is always where the major opportunity will be. As Auckland grows, so will house prices long term and rents seem to be rising too.

Problem is yields and cost to enter the market. I would personally love a rental near the CBD, maybe Ponsonby. But whats the cost for a reasonable rental there?? $800,000??
So if you could get $800 per week (which sounds quite high) then that would only be a 5% return. If you have other secure income, that could still be a good investment, but
many investors need a better return.

So I quite like the areas one step down from Auckland, like Hamilton.

Ross

[Bob Kane]

Problem is yields and cost to enter the market. I would personally love a rental near the CBD, maybe Ponsonby. But whats the cost for a reasonable rental there?? $800,000??
So if you could get $800 per week (which sounds quite high) then that would only be a 5% return. If you have other secure income, that could still be a good investment, but many investors need a better return.

A fine example of why investors don't drive up prices.

[damage]

A fine example of why investors don't drive up prices.

Disagree, there are many investors out there that see through the yield with the expectation of capital growth.
They have used negative gearing to assist in making the investment worthwhile, or to minimise the pain while waiting for the growth.

[BJT]

Seems there is some good information on here and then there is simply people who seem to be on the wrong website commenting and confusing new investors?

Sorry my first post on this site is also negative but HEY 'Damage' ! - Most of your posts are causing damage - to good people being mis lead by your bizarre comments.

BT



BT

[Fingers]

BT, I think you need to analyse the words in Damage's response. Do a search on negative gearing to try and get some understanding of this principle. Basically this is purchasing an investment property that does not initially have positive cashflow, the long term goal is the capital gain that will come in time.

Slow and steady is a sure way to accumulate wealth.

Fingers