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From 0 to 130 Properties in 3.5 Years > 2 Making a start > Flashcards

2 Making a start Flashcards

(67 cards)

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1
Q

What is the first step to becoming a more successful investor?

A

Gaining clarity on what you are looking for from your investments

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2
Q

What should inexperienced investors avoid focusing on?

A

What they don’t know or what they don’t have

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3
Q

What are the two types of profit an investor can choose from?

A
  • Cashflow
  • Capital appreciation
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4
Q

What was the author’s priority in terms of investment?

A

Finding a source of regular and reliable cashflow

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5
Q

What is the formula used to calculate a maximum purchase price based on rent?

A

It involves taking the likely weekly rent and working backwards

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6
Q

What area did the author initially consider for investment properties?

A

Suburbs in and around Box Hill, Victoria

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7
Q

What was the approximate value of the property the author was renting?

A

$200,000

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8
Q

Why did the author feel disheartened when analyzing properties in Melbourne?

A

He couldn’t find a single property that would provide a positive cashflow outcome

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9
Q

What city did the author focus on after considering a colleague’s advice?

A

Ballarat

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10
Q

What was the price range of properties in Ballarat mentioned by the author’s colleague?

A

$60,000

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11
Q

What is a common misconception about investing in rural areas?

A

That they will never achieve capital growth

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12
Q

What is the key benefit of investing in properties with reliable cashflow?

A

It can allow you to never have to work again

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13
Q

What was the author’s experience when arriving in Ballarat?

A

They found the city quiet and not very active

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14
Q

What is a good strategy for discovering information about an area?

A

Ask a local

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15
Q

What was the first real estate agent’s name that the author encountered?

A

Tom

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16
Q

What kind of property did Tom show the author and Dave?

A

A block of eight units in a brick complex

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17
Q

What was the condition of the properties shown to the author?

A

They needed urgent cosmetic repair

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18
Q

Describe the first unit shown to the author.

A

Covered in wall-to-wall crochet

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19
Q

What was the tenant’s name in the first unit shown?

A

Connie

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20
Q

What critical lesson did the author learn from Connie’s response?

A

Different people have different tolerances for noise

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21
Q

What was the author’s initial impression of investing in Ballarat?

A

He was skeptical about the potential for capital growth

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22
Q

Fill in the blank: The author’s wife and he were leasing a two-bedroom unit in _______.

A

Box Hill, Victoria

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23
Q

True or False: The author found many properties in Melbourne that provided positive cashflow.

A

False

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24
Q

What sound does Connie enjoy to help her sleep?

A

The sound of traffic all night long

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25
What is the primary lesson mentioned in the text regarding investment properties?
You buy investment properties for other people — not yourself
26
What did the narrator find in the unit that was a parting joke of the previous tenant?
A homicide-style outline of a life-sized body spray-painted on the floor
27
How much less than the asking price did Dave and the narrator offer for the property?
$100,000 less
28
What was the reason given for the rejection of their offer?
The seller needed full price to settle other debts
29
What was the perception of the narrator and Dave by real estate agents when they dressed in suits?
They were perceived as out-of-town investors
30
What attire did the narrator and Dave switch to for better negotiation?
Tracksuit pants and casual clothing
31
What lesson did the narrator learn about pricing for locals versus out-of-town investors?
There was one price for locals and a higher price for out-of-town investors
32
What is the suggested attire to avoid being perceived as an out-of-town investor?
Casual clothing, such as tracksuit pants
33
What is the importance of spending time in an area when investing in real estate?
You’ll find it next to impossible to pick up a feel for properties unless you spend time 'on the ground' there
34
What did the narrator create to ensure thorough inspections of properties?
A series of templates for property inspections
35
What is the purpose of using due diligence templates during property inspections?
To ensure a thorough inspection and to identify potential issues
36
What specific issue did the narrator identify during one property inspection?
A central heating system that sounded like an aeroplane taking off
37
What type of properties did Michael Golding, or Micky G, show to the narrator and Dave?
Ex-commission properties
38
What was the condition of the first ex-commission house inspected by the narrator and Dave?
It was in a disgraceful condition with graffiti, burnt kitchen, and missing floorboards
39
What was the asking price of the last property inspected by Micky G?
Offers above $50,000
40
What key factor did the owners of the last property need to sell?
Due to poor health
41
What was the estimated rental price for the last property inspected?
At least $110 per week
42
Fill in the blank: If you don’t know an area like a local, don’t _______.
invest there
43
True or False: The narrator and Dave ended up buying a property through Tom.
False
44
What was a valuable lesson learned by the narrator and Dave from their experience with real estate agents?
Being organized and using templates makes you appear as a serious investor
45
What was the initial asking price for the property before it was reduced?
$54,000 and $52,000
46
What was the new asking price for the property after the owners became more determined to sell?
Offers above $50,000
47
What was the estimated rental price for the property according to Michael?
At least $110 per week
48
What was the initial offer submitted for the property?
$40,000
49
What was the minimum price the owners would accept according to Mick?
$48,000
50
What was the final offer made by Dave and the narrator?
$44,000
51
What was the total amount of the purchaser's settlement statement?
$45,704.78
52
What were the closing costs associated with the property purchase?
$1,705
53
What was the principal amount of the loan taken for the property?
$35,200
54
What was the initial interest rate on the loan?
8.05%
55
What was the weekly repayment amount for the loan?
$62.82
56
What was the annual cash flow received from rent?
$6,240
57
What was the total cash flow out per year?
$5,197
58
What was the annual net cash flow from the investment?
$1,043
59
Calculate the cash-on-cash return using the formula: Annual net cash flow ÷ Initial cash needed.
9.30%
60
What is one insight about doing your first property deal?
You’ll only ever do your first deal once
61
What is a good starting point for potential investors according to the insights?
Create a profile of your ideal property
62
What should investors do to distinguish a good deal from a bad deal?
Establish ground rules
63
What is considered the most valuable asset in property investing?
Time
64
What is advised to do when planning to invest in a new area?
Visit the area personally
65
What is the recommendation for serious property investors regarding templates?
Using templates will save time and help avoid mistakes
66
What should you not do according to Insight #7?
Never get into a car with someone called Tom who was working as a real estate agent in Ballarat in May 1999
67
What bonus is offered upon registering the book?
Download the property inspection template for free

From 0 to 130 Properties in 3.5 Years (12 decks)

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