“Hello. I just thought I’d start out by giving a little bit of an introduction of myself. I’m a property mentor from Sydney, but I’m also a full time chemistry teacher. I have four children, two of whom are studying chemistry at the moment so I’m also a chemistry tutor to my children. I’m also, just for my, I have a voluntary full time unpaid position as the president of the Science Teachers Association of New South Wales. This is really property investing for busy people. This is the only way we can possibly invest is through property because we can afford to be a little bit lazy, not too lazy about it, and it just happens.
We’re in the consolidation phase. At the moment I need to start to get back into this. The first thing that I need to do is to work to improve my property performance. Some of the things that I might look to do, our first property that we bought in 2004 is in Port Kennedy in western Australia. It was currently renting at $175 a week. It was five years old so it needed a bit of maintenance. In that time, from then to now, we’ve renovated the en-suite, we’ve put a garden shed, we’ve put in a car port, we’ve put in some air conditioning for those people. It’s now renting at $350. Its doubled in that time as well. I haven’t neglected my other properties. I’ve put in air conditioning in one, a shed in another and so on. That’s the way you can improve your property performance.
What else do I do? I’m on the body corporate of three of my properties. So four of them are [inaudible 00:07:34] properties and I’m on the body corporate of those. I’m trying to help maintain the entire development to make sure that my property and all the other properties that are surrounding it are living up to the standard that I want them to. That’s some of the suggestions that you could do to improve your property performance.
You’ve also got to have increased flexibility. This is really, as Ralph says, a time to wait for you properties to grow. You’ve got to have a lot of flexibility. Rates could go up and down. You need to be able to manage that. You could have loss of rent. Your rent might go up. What else might happen? You might need to decide on whether you fix your rates. Who signed up to Kevin’s email about fixing rates? A few more people than yesterday maybe. Kevin is going to send out another notice about that this week. If you’re interested to know what Kevin suggests about fixing rates, he is going to send up some bulletins about that. That is another thing you could do. You need to have that flexibility. You need to be able to look after the good times and the bad times as well.
This is three to five years ahead that you’re planning for so your consolidation three to five years out from when you want to retire, give up your full time job. You need to be in contact with your broker. You can’t just retire and then say to everybody “I’ve retired, now how do I get that money?” You need to be in contact with your brokers to set up the strategies. It is easy to do that while you’re in full time employment, or, at least, in the employment that you’re in at the time. You need to also talk to your property mentor. Don’t spring it on them either. You’ve got a few things to do in this consolidation phase to still be working at it and I certainly do need to, after a busy year last year, get back in and see where my properties are. They’re still growing and I’m still getting rent and my agents are looking after those for me.
All right, the last stage is one that Harpal is very good at and it is the harvest stage.”