Confucius say… “Property investor looking to create wealth from real estate can learn much from ancient Chinese proverbs”.
Okay so I’m not quoting Confucius verbatim, however the teachings of the ancient Chinese philosophers still ring true in today’s very different, modern world and have clear application when it comes to the business of real estate investment.
Those property investors who understand the importance that mindset plays in their wealth creation journey should gain some insights from the following Chinese proverbs – a handful of my favourites.
I have found that your level of wealth will seldomexceedyour own personal development. That’s because your way of thinking regarding money, wealth and prosperity will determine the financial heights you reach.
You see, your thoughts lead to your feelings, your feelings lead to your actions and your actions lead to your results. Your inner world (your thoughts and feelings) will determine your outer world (your results and destiny).
So first work on yourself, because your wealth won’t grow unless you do. And if per chance you do happen to stumble upon a financial windfall and your wealth takes a lucky jump, unless you grow out to where it is, it will go back to where you are because it’s very likely you’ll lose your money through mistakes or mismanagement.
One of the big mistakes beginning investors make is to think they can do everything themselves. They do a bit of research, crunch some numbers and suddenly they’re industry experts. And of course you can’t tell them anything because they know it all.
As I frequently say, if you’re the smartest person in the room, you’re in the wrong room, so recognise the areas where you need help and don’t be afraid to seek out expert advice. There are no foolish questions, just foolish people who were reluctant to ask.
One more thing, don’t be put off because a learning opportunity costs money. We all pay learning fees – either to someone who helps us or to the market because of our mistakes (which are usually very expensive).
Finding a mentor is the fast track to acquiring the type of property investment insights that can never be found in a book. Seek out mentors who have already achieved the goals that you aspire to by successfully investing through a number of property cycles and just as importantly who’ve managed to retain their wealth.
One bad asset can be the proverbial fly in the ointment that holds back your portfolio’s overall growth. So review your property portfolio regularly.
If you find a property that, knowing what you know now, you wouldn’t buy again today consider selling the err, “mouse dropping” in order to make room for a better addition to your “pot of (property) porridge”
Every year unforseen X factors come out of the blue to test us, so look forward to the best of times, but prepare yourself for the worst.
Protect yourself and your portfolio against unforseen crises – be it a personal one, like losing income due to ailing health, or something on a larger scale.
Sustainable wealth creation through property investment isn’t a process you can rush. It takes time for compounding and leverage to work its magic.
Self-made billionaire Warren buffer put it a different way; “Wealth is the transfer of money from the impatient to the patient.”
It’s never too late to get into the property game. Sure, it would have been nice to do when the median price of a house was $100,000 but interestingly that seemed expensive to most investors 20 years ago.
There are always opportunities in the property market. The sooner you start, the sooner you’re on track to reaping long term riches.
Michael Yardney, Australian Property Investor, 2014