The #1 Property Hack For TRULY Passive Income
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- Опубликовано: 10 мар 2024
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Some people assume that investing in property is the best way to make passive income, but that isn’t always true.
I know lots of investors who’ve spent years building a portfolio that sucks up all their time and money, yet they STILL aren’t on track to reach their financial goals.
Because they don’t understand the game. They don’t understand the sequence of steps they need to take in order to build a profitable and passive property business. But luckily for us, there is a very simple way to learn, and it involves an actual game: Monopoly.
So I will explain exactly how to start making passive rental income from property and passive income from real estate.
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Biggest issue with this in my opinion is once you buy properties over £250k stamp duty goes from 3% to 8%. That makes a huge difference costing thousands that you need to fork out and more than doubling the tax
Couple of things to note here.
1. 150 per month should be more like 300 per month.
2. A void period in a 5 property portfolio is 20% of income lost in a 20 property its only 5%
3. Cashflow is probably significantly lower in the 5 property portfolio.
4. Whilst equity in nice to have releasing it is never as easy as people make it sound
Well Tina also benefited from rising rent, but we get your point. I started out buying cheap properties and you still spend the same amount refurb a cheap house.
Great video! I personally prefer more cash than property growth... a bird in the hand is worth two in the bush (kind of)
Absolutely great video. This is exactly where I'm at in my journey. Love your content pal it's always spot on
Used to own 10 properties in Australia but I was continually pumping my own money into them. I eventually crunched the numbers and realised that the only people making money were the government, property managers and sales agents. Needless to say I sold up and out my savings elsewhere
I assume savy property investors are doing so through Ltd. companies now rather than as private individuals? I believe it's almost certain that the property price peak looking back 2.5 years and looking forwards 2.5 years has been reached, and won't peak again until either wage growth picks up significantly and/or interest rates drop quite significantly. We've reached a point where high asset prices have met high inflation and high interest rates, so something has to give eventually; And hopefully it's a small drop in all three rather than one dropping significantly - which usually causes more problems that it fixes.
Hi Rob, if you had a ready cash budget of £600k, would you purchase 2x 2 bed flats, or a freehold house for the best ROI, in the long run? Just curious. Thanks
I feel very conflicted about this video. I do agree that the better properties have better growth (and I also agree with the concept that more properties = more hassle, to some extent). However, there are some bits that I don’t necessarily resonate with:
1. Tina has made some poor investment choices by having properties that generate only £150/mo. I would say my cheaper properties arguably make more because the market rent doesn’t alter as much but the mortgage is naturally lower. It would be better to go by around £250/mo, leaving her with an income of £5000/mo overall.
2. While the growth of the prime properties is greater, would 5 of them grow better than 20 cheaper properties? Would each prime property grow 4x as much?
3. You don’t necessarily ‘upgrade’ in monopoly, but rather you buy in ADDITION to. You’d buy Mayfair, but if you could also keep Old Kent Road, you would.
Now, if you said that you sold your properties and moved into the commercial space, then that seems more reasonable and aligns better with the idea of hotels in Monopoly
I used to love Monopoly
Bottom line is different strokes for different folks. Horses for courses. I know plenty who make a lot of money buying cheap northern houses. Similarly I know many who invest only in the south and London who are making equally good money. And then everyone in between.
There is no right answer. Both strategies work. It just depends on your skill, luck and timing.
When you say that she better bought 5 properties, each worth £400,000...you're assuming that these properties will keep growing and growing in value...That's quite a risky assumption and this is in fact what's happening here in the South East where the prices are falling. If she puts in a 25% deposit for each house, the debt she will end up with owning these 5 properties will be a whooping £1.5million! Do you think a small and damp shoebox 3 bedroom house in the SE that currently cost £500K will increase to 1 mil in 10 or even 20 years? If that happens, we will have bigger concerns than house prices...
Could the U.K. government allow or stimulate property prices to simply enable banks and funds to buy up all housing and rent to the population?
It’s all about supply, demand and inflation. The exact statement as yours people had in the 90s when flats in zone 3 London costed 35k and now are on minimum 350k :)
@@odysseasv7138 Yeah right...Currently a half mil 3 bedroom semi detached will rent for about £2000 per month where I live. Will you invest in that hoping one day it will be worth £1 million pounds? With right they say that over 90% of the people in the property market are complete amateurs...Fortunes can be made but remember it's a zero-sum game...
I'm not sure where in the south east you are, but in my part of the SE prices are not falling
@@andymason7393 Around Reading...
so she isnt buying it outright, she is just putting down a deposit and paying mortgage fee monthly?
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She rents out 2 bed houses and makes £150 a month? Is she getting £450 rent per house? 🏠
Yeah those numbers have been lowered to suit an agenda I think. My mother has 2 signle lets, both very cheap houses in shit areas. One is a 2 bedroom and the Other is a 3 Bedroom. She has 75% mortgages on both and is making just over £300 a month on both. But we'll round it to £300.
£300 a month profit for basic, small and cheap houses in a undesirable area is pretty much the standard. If Tina has 20 properties she's earning more like £6000 a month which really is quite decent. However that's not to say Rob doesn't have a point. Quality of a rental portfolio is important, but just because you spend double on a property doesn't mean it will bring double the monthly profit, but it will cost more in tax. 2 £150k houses bringing in £600pcm is better than 1 £300k bringing in £500 a month. But each to their own. The £300k house purchaser might just prefer the area and thinks that house will attract better quality tenants.
@@Ellis01234567890it’s all about the sweet spot then