I have decided that at the end of each month I will write a detailed monthly report about my property portfolio and investor lifestyle. There is a lot more to owning a property portfolio than just simply signing a contract, sticking a tenant in your property and forgetting about things.
I hope by sharing my Monthly Review it will be helpful for you to read about the good, the bad and the ugly when it comes to creating and managing a property portfolio and investor lifestyle. This is going to be the real life stuff involved with property investing. Most of flashy sales teams trying to sell you properties will never tell you about these behind the scenes things.
I will share as I review any challenges I faced. What I can learn from these experiences? What good can come from it? By finding the positive and the lessons learned, those challenges then become your asset. This will ensure you don’t make the same mistakes or experience the same challenges/failures for your upcoming investing journey.
Interest Rate Reduction
For the third time in less than twelve months, this month Murray called the banks we have loans with and requested they review and reduce our interest rates. I have to make it clear, that this request is in addition to the drop in interest rates the banks have given as a result of the RBA reducing rates this past year. It really does pay to continually check in with your bank and keep them honest. This is extra money in our bank for just 10 minutes effort.
South Hedland Deal
This is a deal we are doing with a Joint Venture partner. You can read about the deal in more detail here where it all started.
The initial plan was to have already started to build the first of the new houses (4 x 2) by now on the rear of the block. To date this hasn’t happened for a couple of reasons. The main one is that we are investigating the opportunity to use pre-constructed buildings in a slightly different configuration from our original plan.
Some good research has been done by our partner on the option to have some smaller modular style accommodation built in China and shipped to WA for installation and final fittings. It would be very much along the same lines as what a builder in Perth has recently done recently that you can read about in this article.
Original plans: Two 4 x 2 houses plus one 2 x 1 granny flat giving us three rentable properties.
Currently being considered:
Two 4 x 2 modular multi-key units. Each of these modular units would have dual occupancy (multi—key) which means each 4 x 2 can be rented out as two 2 x 1’s. In addition, we can also fit two 2 x 2 modular multi-key units. Each of these modular units would have dual occupancy (multi-key) which means each 2 x 2 can be rented our as two 1 x 1’s.
In total, this option would provide us with a total of eight rentable units.
As with the homes Mr Forster has erected, the houses would be Cyclone-D rated and designed to meet the needs of the demographic current looking for accommodation in South Hedland and Pilbara region.
So, our joint venture partner is continuing to research the costing, viability and rental demand for this type of property. As you can see, the modular units would provide us with a much larger rental base and spread our risk should any of the units not be tenanted for a period of time.
If we decide to go ahead with the change of direction in what is built on this property, the current DA approval in place from Council would need to be re-submitted for some changes although we can’t foresee any difficulties in getting these amendments approved.
We were fortunate to buy into the Pilbara region at a time when the prices had already dropped considerably, and now it’s a matter of working out how we will maximize returns on our investment so that we can ride through the current conditions and still be players in the field when the next lift starts to occur – and I believe it will.
Balmoral Joint Venture
This deal is a sub-division on a block of land in the inner suburbs of Brisbane. The sub-division is now completed and we have engaged a marketing company to promote the blocks of land to builders with mock plans of the type of house that could be built on these properties that would still provide a builder with a good profit margin himself, and see us receiving our expected asking price for the two blocks.
Hopefully next review we might have had some nibbles on these blocks
This project is a larger 80 lot sub-division that is being done in two Stages. Large machinery is starting to come in to do earthworks, drainage etc and I’ll post some pics as soon as I have some. Many of the Stage 1 blocks have already been sold.
We will be due to receive one chunk payment of some of our capital back that we invested into this project so the Line of Credit will enjoy having another $50,000 in it. This payment schedule was all agreed upon and set out in legally drawn up Loan Agreements between ourselves and our JV partner.
We’ve recently replaced the oven in this property, and the tenant is now complaining to our Property Manager that it is not working properly and is inefficient.
We have also just ordered for a security screen to be fitted to the front door. This will assist in airflow in the warmer months, but more importantly, will also address the needs to meet with safety standards now imposed on rental properties.
Flynn Street, Churchlands
The new tenant that moved into this property in January has been no trouble and the increased rent we are receiving is very welcome. There will be a rental inspection on this property mid April. We have decided to attend this inspection personally so we can see first hand how the property is being kept.
A tradesman has been contacted to go and quote on some repairs to the patio at this property.
We are still waiting on a report on exactly what needs doing and the cost.
We have flagged 2015 as a year to do quite a few maintenance jobs on our principal place of residence. The most urgent was to replace the front doors which were very weather damaged and not a good look as the entry point to our home. The new doors look fantastic and still need a final coat of paint to finish them off which we’ll do after Easter.
Reviewing Our Own Portfolio
We had a good review of our current property portfolio during the last few weeks and can see that our focus still needs to be on increasing our borrowing capacity/income further to be able to add still another property or two into our portfolio. The sooner we can add these properties, the longer we have it to take advantage of another full property cycle.
Books I’m Reading
I was unsure about spending the time to read this book as I knew it had a very large focus on shares and mutual funds. But I figured if it was written by Tony Robbins, there would have to be something I could learn from it. And I was right! I’m only part way in, but this is a book that I would love to make as essential reading for all teenagers or young adults. The first few chapters lay the foundations for understanding the importance of saving, investing and having your money work hard for you. Even as a seasoned saver and investor, these are good reminders for me too. I’m looking forward to finishing the rest of the book. (I should get some good reading in over the Easter break!).
Property Investing Support Blog
Although this blog is reflective of the personal journey both Murray and I have taken to build a multi-million dollar property portfolio, it is important to me that visitors also see it as being a professional and high quality hub for information. It is for this reason that I have spent much of the past month working with designers to re-design this site. I am planning on being able to release the new version to the public by the end of next month, so watch this space….
Lifestyle & Personal Development
I’m excited to have locked in my ticket to the annual ProBlogger event. It’s an event for lots of other bloggers and online entrepreneurs to get together and improve their presence and make new connections. It will be good to visit the Gold Coast and get lots of new ideas on how I can deliver great content to you on this blog.
Meditation and Journaling
At the end of 2014 I decided it was important for me reduce the high expectations I was setting on what I could achieve with my time. To learn to say ‘no’ sometimes and be sure to spend the majority of my time on things that were going to move me closer to both my professional and personal goals.
I am now regularly including meditation into my week and enjoying the process. It’s a new skill and one that I have wanted to introduce for a long time. I am also journaling every day giving gratitude and setting intentions for what I want my new day to be like. My journaling and meditation have both been helpful introductions to my daily routine to me start my days in a more peaceful way.
The end of March also saw the end of the first quarter of the year. It was time for me to review my quarterly goals. To see which ones got hit, and which ones fell short. It’s the first time ever I’ve been really committed to setting my long term goals and consistently reviewing my progress. I break the long term goals down into quarterly, monthly, weekly and daily goals. I have to say I love it and have got so much more accomplished this way. I can still make even more improvements for sure, but I’m happy with the results so far.
I enjoyed putting this Monthly Review together and I look forward to doing one again for April. It’s great to share what’s working and what’s not and to give you an insiders view to property investing and wealth creation. Thanks for reading!
Please leave a comment below or let me know any questions you have. I’d love to hear what you think!
P.S. If you want to find out how you can start building a property portfolio that will fund a life you love… then the next step is to reach out by submitting a message by clicking HERE and I’ll look forward to seeing if I can help!