Consider this critical point…
A passive income target without a STRATEGY is guesswork…
Nothing is impossible, but a well-defined property strategy can give you a whole lot of certainty, a substantial amount of control, and a dedicated path to follow to get you to your goal.
Using numbers to achieve passive income goals
Ideally, you need to know exactly how many properties you require for your portfolio in order to meet your targets. Further, you need to know exactly what order you should buy them in, the sequence, and the timing of them.
- Are you going to buy them all in the first 3 years, the first 5 years, or 7 years?
- How are you going to space them out?
- What is the value of each property?
- What is the yield of each property?
- Which ones are you going to keep towards the end when you retire?
- And what is the yield on those required to be, or what is the capital growth that you need in order to actually achieve that portfolio value at retirement?
- How do you create a lending strategy?
And what about finance?
Finance is such a fundamental part of your investment strategy; without finance, you are restricted in your portfolio growth.
Will the bank give you a loan for 7 properties based on your income and income growth potential? Probably not.
So how do you more intelligently approach lending to maximize your portfolio build?
- How will you effectively structure your loans?
- What interest-only periods will you sign up for?
- When will you introduce principal plus interest lending?
- What is the yield of each property?
- How many lenders will you work with?
- Will those lenders include top-tier banks only, or will you consider second and third-tier banks and lenders if it means getting access to the finance you require, even if the fees and interest rates are higher for these outfits?
How you put all of those variables together is an investment art. How you maneuver them to carry you from where you are now to your desired goal of passive income earnings is based on the strategy design right at the start of your investment journey to give yourself the chance of an optimal outcome.
