Time commitment to property investments

[Taonga]

Morena ppl,

I have a few questions for all the seasoned investors out there.

When you went thru your planning stage for property investment,did you take into account how much time would be required to fulfil yr plan?

Now looking back, have you found it to be more or less than planned?

And for those who now do it full time,does it provide you with the "financial freedom" you were looking for,if that was your reason?

All opinions and views would be greatly appreciated.

Cheers, Taonga.

[drelly]

It's a tough question... for one of my IP's I'm on my third set of tenants this year! For another, they've been there approaching two years. I'm fortunate that I'm self employed and have no "shop" I need to keep open, so I can take off at pretty short notice if something needs to be done. I can also take a day off to work on a house if need be. I doubt I'd be quite so willing to take on rentals if I was employed 9-5!

[orion]

When you went thru your planning stage for property investment,did you take into account how much time would be required to fulfil yr plan?

No, it never was a thought when I started, but if I was starting again, it definitely would be one of my rules - "how much time will I invest each week on the business of growing my property portfolio and my investing knowledge?"

Now looking back, have you found it to be more or less than planned?

Probably now, less than I would have imagined if I had thought about it. Everyone is different in this area, I would invest a maximum of 4 - 5 hours a week now looking after approx 60 properties. Some people will spend a lot more time than this, but a lot of it can be contracted out to others. The key is to work smarter, not harder. Work out what you think you are worth per hour, then multiply it by at least 10 - this will be a more accurate figure of what you are worth, most people under-estimate what they are actually worth which limits them greatly, therefore they do the jobs they could be paying others to do. Concentrate on the high dollar per hour activities and pay others to do the $10 - $50 per hour odd jobs.

And for those who now do it full time, does it provide you with the "financial freedom" you were looking for, if that was your reason?

I used to do nothing else for 4 whole years up until two years ago, but it got extremely boring doing only a few hours a week. You can only watch so much TV, go for so many walks and play Playstation so often, that it eventually gets very boring. Now I also run a business, have written a book and run a mentoring programme. My income this last financial year was around $750,000 working only about 20 hours a week in total. The properties also would have increased in value by well over $1 million which is just a bonus, nothing else. Next year, they may go down $1 million for all I know.
Retirement is highly over-rated, you need to do something so that you continue to grow as a person and also contribute to others. The great thing about getting to a stage where your passive income exceeds your expenses is that you now have more choices in life - you are not sentenced to a life of slavery working for someone else. To me now, that would be like being locked up in jail. When you think about it, it is very much like that. You get told what to do, when to arrive, how much time off you're allowed off and get paid a small amount each week to do so (most people will do this all their life and are completely happy doing it - there is nothing right or wrong about it, just individual choices). You have very little time when you work for someone else to actually make any serious money, although of course it still can be done. I was a mechanic for 10 years, but always had the desire to get out of the rut and drudgery of trading time for money. That is why, you need to make a decision to have the discipline to start now and do whatever it takes to succeed. You must pay the price for however long it takes. If you do - you will reap the long term rewards. It may take 10 - 15, maybe even 20 years, but it's all worth it. You will become a better person for it too, don't let anyone else ever tell you otherwise. All it is - is a choice. You're only here once - why not really go for it and give it your best shot!

Regards
Graeme Fowler

[Gerrard]

Hi Taonga

When I started on the Invstment Property track I really had no thought about how much time it would take. Looking back over the last 18 months I have invested quite a lot of time considering there is a family and full time job in my life as well.

I would guess it has been anywhere from 0 to 20 hours a week, just depending on what's happening. In the last couple of months most of that time has gone into education. When I first got on the Investment Property wagon it sounded like a good idea, I scored a couple of good deals quite easily, and it seemed like a good investment for retirement.

However I never really thought that hard about why I was doing it or what I wanted to get out of it. The last couple of months have been pretty much back to basics about setting my goals, researching ways to make them happen, and getting my wife committed to the plan.

I can't underestimate the importance of setting your goals - that will dictate how much time you need to invest.

Also, be ready to re-examine your goals. While the original reason I got into property is still important to me (long term retirement savings) I've also decided that paying down my own mortgage quickly is also important to me. I'm now chasing opportunities in both directions.

Good luck
Gerrard

[Taonga]

Thanks guys, a wealth of information as usual !

[regan]

Now I also run a business, have written a book and run a mentoring programme.

Hi Graeme - do you have more info on your mentoring programme, or is just something you're doing with a selected few?

Regan.

[orion]

Hi Regan,
Thanks for your message. At the moment I am 3 months into a 12-month mentoring programme with 15 people. I also have over 50 people that have e-mailed me from my book about the course wanting to do the next one. At this stage, if I do another one, it will be early next year, but no definite plans at this stage. If you would like me to let you know if I do another one, I will add you to the current list I have. You can e-mail me at [email protected]

Regards
Graeme Fowler

[LeanneS]

Acquisition always takes more than you think - chasing lenders/lawyers getting everyone coordinated. And finding the deals in the first place!

I have my properties managed, and I spend close to no time at all on maintaining once I have them. That's not to say they are not well maintained - far from it! Just not by me :-) I email my manager occasionally, sign forms etc., and send my accounts to my accountant. occasionally I call my valuer and my broker to get a refinance.

I am in the UK and my properties are in NZ - so its actually disciplined me to stay away from them. I spend more time with my UK properties than I probably need to, just because they are on my doorstep.

Cheers,
Leanne

[Monid]

Well property investing definitely took up a fair wack of time when pursuing new properties, which is why I have sworn off it for a while...
my PhD doesn't write itself

Management doesn't take too long if you have a good set of property managers which fingers crossed we do (Actually must recommend Leigha Rowe from Harcourts in Hawera at some point, she has really impressed me in managing our properties down that way and looking out for our best interests. When we bought a new place in Eltham we wanted to get her to manage it for us, she suggested that we get the current mamagers to keep it since they had an excellent rapport with the tenants, and negotiated a fees reduction for us. Has to be the sign of an excellent professional, looks after her clients well even when it isn't in her financial interests!)

I think some weeks it was definitely a 40 hour job especially when we were combining property hunting with renovating. Now maybe an hour opening mail approving repairs etc...

Cheers David

[pixie]

We manage our properties - and I am clearly no where near as smart as the man above who manages 60 odd on a matter of hours. But its ok as I can still learn :-)

When I worked full time as a professional person and tried to manage them it nearly killed me.

Now I am "semi-retired" running three businesses from home including the properties it is fun.

I look at this way - my properties are earning over $90k per annum in rent and it is about a half time job. Thats a good pay packet and I am happy with it.

We work hard on the properties, doing most of them up and believe in not being overly indebt. If we ever get sick of it we know (financially) we can afford to get a property manager involved. We also employ professional painters, plumbers etc but do the rest ourselves.

Financial freedom ? We were utterly estatic early this year realising that at we actually didn't have to be on the salary treadmill anymore. Suddenly the properties went from emotional headache (at times) to most revered ! Property got us where we needed to be years ahead of schedule. Now everything we do financially is for the icing on top of the cake!

My only regret is not having understood the importance of holding the properties and the value of property investment years ago. I have no doubt that property investment has given me a freedom that other financial investments promised but not one of which ever delivered.