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(11-12-2015 04:44 AM)ipsy_dipsy Wrote: 1)The luck question - As I gave you an example earlier, were you born 10 years prior, for instance, and as a result had you started executing your "10-streets" strategy in, say, 1988 just before the prolonged trough, those 65% you mention could have nose dived into a negative territory big time!
Negative equity doesn`t mean you go under. It maybe limits growth and curtails exit strategies. But you should consider yields and cash flow which carry you through these periods. I made more money in my hand during 2008 / 9 / 10 after the crash than i did in 2005 / 6 /7 before it.
Have you read my hovercraft approach thread. That enables you to skim over all these irritating waves in the economy
2) What year was the right time to invest in property in your view and why was that year crucial? It makes no sense whatsoever to look at any specific year. There are only numeric individual opportunities and they are not measured in years,
But your previous answer seem to say that 1988 was not a vintage year to invest. Ergo - Other years then are presumably better. You appear to contradict yourself when you say it makes no sense to look at a specific year.
3) Please give me an example of an unforeseen hazard in property investment ? . How about an unexpected interest rate hike? How about banks calling in their loans simultaneously due to, say, new Basel accord applied across the board and out of the blue? How about bad tenants trashing your property to pieces? Or how about a meteorite happen to choose comfortable landing on top of your property? Ok, even leaving purely human-made factors out, we are still dealing with BRICKS-AND-MORTAR: bricks crack, mortars crumble.
I totally expect interests rate to go up and down over the course of the next 25 years. That is about one of the most predictable things in our economy. Its not unforeseen at all. ( Read Hovercraft approach thread) I totally expect a bad tenant to trash my property at some point in the next 25 years. Thats why i keep a contingency fund.
Meteorites are covered as is cracking bricks and crumbling mortar and subsidence and roof falling in and leaks underground etc etc by insurance. Just sorting one out now . £100 excess paid for maybe a £2000 job . Again I expect these so plan for them. I agree that if 20 boilers go down at once its annoying and a body blow but I would still survive. Plan for the worst . Hope for the best . As Paul says its a calculated gamble.
I`m not bullet proof -but if you are the type that takes 20 umbrellas with you ( in case 19 break ) when you visit the Sahara because there is a 0.5% chance of rain then perhaps BTL property is a not the investment vehicle for you :-)
4) What defenses are you referring to? This is a good one, JC. I really hoped you could share with us your real nitty-gritty,
Contingency fund. Money sorts most problems out. The key is how much to hold. I used to carry 2% of borrowed money when growing my portfolio . Mark Alexander on 118 recommends 20% . I sit now at about 10% . That`s my defence
Jonathan, as much as I would like to believe that you're absolutely infallible iron man and your heart never sinks, I'll beg to differ. Because everyone's heart sinks, with no exceptions. It just depends on the individual and any given circumstances. In your above example, having a comfortable feeling about your equity cushions when property prices started to tumble isn't the same as "The doubt crept in" when you thought you had paid over the odds for your investment property. I must admit, though, I exaggerated your rather mild "the doubt crept in" and translated it into more critical "heart sinks". My apologies. But I bet there were plenty of business-related situations where you have experienced emotional yo-yo effect.
Oh yes sure I`ve experienced the yo yo effect. That`s an adrenaline rush though. Love it. That`s the buzz of business. We are all different. Its getting a sense of proportion about whats important in life Some peoples heart sinks when Sainsburys have run out of apple turnovers.
Its often your in built constitution though and how one reacts to bad news. I am lucky I guess I dont suffer from depression / off days / the blues. There you go I`m lucky. You got me. I finally admitted it!
As for the established well trodden path vs tightrope, you're right, it so much depends on how you look at it. The glass is either half-full or half-empty, there are no grey areas in between. Agreed, many people (myself included) walk it a tightrope (mine is due to personal circumstances). But I'm certainly here to learn and change this attitude eventually. That "financial freedom" part sounds straight out of guru courses, so I suggest dropping it for now because everything in life comes with price. Learn-execute-rinse-repeat >> Learn-execute-rinse-repeat >> Learn-execute-rinse-repeat. The financial freedom will then take care of itself, no doubt.
I agree financial freedom is a bit of a yucky phrase. But it does describe the goal in a nutshell. Give me a better one and i will definitely consider it. You've had some knock backs it seems. Compartmentalise them as best as you can . Do the data thing if you have to to get it out of your system. If it works I will buy a copy off you. If not you have learnt something valuable. Log it in your mind and move on.......
And hey dont be scared of success
Jonathan Clarke. http://www.buytoletmk.com
(11-12-2015 04:44 AM)ipsy_dipsy Wrote: I agree that it is no kids task to undertake construction of "enigma machine" while knowing that perhaps it is something that has never been done before. There are hundreds of reasons why many naysayers would cheerfully join you seconding that this is impossible in principle. However, as you may agree, the enigma machine remained enigma to the rest of the world. Except that for a simple, down-to-earth, low-profile and very-very humble German engineer Arthur Scherbius, for whom it wasn't such enigma after all if he managed to build it in the end?
regards Andrew Peers - property investor / sourcer - 07912674181
(11-12-2015 08:47 PM)ipsy_dipsy Wrote: I take it is pointless to try and prove the validity of my points
(12-12-2015 12:55 PM)benhodge Wrote: I hope this helps