The Long Term View VS The Short Term Thinking

The ABC Mindset

When I teach, I talk about the A, B, C mindset where A stands for attitude. Belief is the B, and it's all about having a belief about what's possible and a belief about what you can do. The best way of building your belief is watching case studies of what other people like you have done because if they've done it, it means you can do it as well. C is for courage. For you to be successful, you need to step outside of your comfort zone and think and do things differently, and that might feel a little bit uncomfortable at first.

The first one is adopting an investor mindset instead of a homeowner's thinking. Most people when they get into the property might have their own home and they think very much like a homeowner, but they need to switch that and start thinking like an investor. For example, you don't want to have repayment mortgages on your investment properties. You want to have interest-only mortgages and you don't need to pay them back.

So obviously rule number four was we are buying for the long term. We want to make sure our properties give us cash flow. Now, the golden rule number three, but it's the long-term capital growth that will create true generational wealth for you and your family. This is where you buy or control a property, you renovate it by adding value, then sell it at a higher profit, at a higher price, and hopefully make a profit. Now, this could be a great strategy, it can make you chunks of cash. It's great in a rising market, but the biggest problem with flipping property is when you sell that property, you crystallize the profit, you're never going to make any more money from that property.

Long Term VS Short Term

I'm sure you've heard of the phrase "get rich quick." I don't believe in getting rich quickly. I believe in getting rich but doing it slowly. Now there's a great quote from Warren Buffett, one of the most successful investors of all time. And he says

"The stock market is a device for transferring money from the inpatient to the patient."

I believe the same is true in property; most people want to get rich quickly. They want to make money now. They want to be successful in the next few months or the next couple of years. I understand that we live in a society where we want instant gratification. However, I believe for true success and true wealth, you need to take a long-term view.

I've been through a few property cycles, and I've seen some people make a lot of money quickly in the short term, and then lose it all again. And I've seen other people make money slowly and just keep growing and growing, and now they've got a huge property portfolio and true wealth. Now, this might sound a little bit controversial, but I don't believe in making money from property. I believe in creating wealth through property. And there's a big difference.

Making money is about the short term. It's about quick cash. It's about doing a deal, making some money, and then going and spending it. But for me, I believe in creating wealth. Wealth is about the long term. It's about creating assets that will give you income for the rest of your life. And not only that, but assets that will grow in value, and you can pass on to future generations.

Now, property prices don't always go up; we have something called a property cycle. There are times when prices stagnate or even come down a little bit. But if you've bought a property in a good area and you've got positive cash flow, you can afford to hold that property through the property cycle. And eventually, prices will come back. And on average, they will go up over the long term. And if you're patient and you can hold that property for the long term, then you're going to benefit from the long-term capital growth.

Why Property Is A Good Investment?

When it comes to property, I believe it's a great way to create wealth because it's relatively low risk. You can get a mortgage; you can use leverage. You don't need to use all your own money. And if you buy in the right area and the right property, then it's likely to go up in value. I think it's a great way to create wealth.

It's the way to create long-term income and long-term wealth. So rather than working for 40 or 50 years and then retiring, I believe in working hard for maybe 10, 15, 20 years, creating a property portfolio that's then going to pay you income for the rest of your life. Now, this is not a get-rich-quick scheme. This is a get-rich-slowly scheme. But I believe it's a much more secure way to create wealth.

If you follow this strategy and you create a property portfolio, you're then going to have the choice. You can choose whether you want to continue working or not. You can choose whether you want to retire or not. And if you do choose to retire, then you can live off the income from your property portfolio. Now, one of the things I like about property is that it gives you options; it gives you choices.

You see, property gives you choices, and I believe in having a choice. One of the great things about property is its relatively low risk. Now, I understand that every investment has some level of risk, but with property, I believe it's relatively low risk if you follow the basic principles.