eCentral Business Show^©

Finance and Affordability. John Fitzgerald, Seven Steps to Wealth

Mon 10:00am 27 Aug 2018
Podcast Audio

Property investment has changed the lives of a lot of people. John has personally seen how individuals turned $50,000 of their hard-earned money into more than two million dollars by putting on the right mindset and making the right decisions in their journey as property investors.

John shares his experiences and most profound learnings through his book, 7 Steps to Wealth. He's convinced that there are seven steps to building financial wealth through property investment, and on this particular talk he shares steps four and five; finance and affordability.

When it comes to getting finance, John shares two must-do's:

1. You must get a copy of your bank valuation

The biggest banks in the country have a policy that prohibits them from handing you your bank valuation. This document is important as it tells you how the bank values the investment property and whether they valued it at your purchase price or not. The banks have this bad practice of valuing your investment property below the purchase price  (in turn wiping off a lot of potential equity). So the best course of action is to have a good look at your bank valuation. Dealing with banks can get tricky, so you have to have the know-how, which brings John to his next point:

2. Whatever you do, don't go with the same bank that funded your own home

Banks tend to cross-collaterise the mortgages in those cases because they have to protect their shareholders and depositors. Go to a separate bank, and get a 95% loan.

Once you got finance taken care of, aim for affordability. Target the bottom-end of the market because that's where 95% of the action is. When you put your in-depth know-how in finance together with affordability, what you have in the middle of this money-making venn diagram is a location criteria. When John is eyeing for another investment property, he doesn't go with location, location, location (that's outdated). He goes for properties that are in close proximity to schools, transport hubs, and hospitals. So instead of location, location, location, he considers land content, time, and then location.

The 7 Steps to Wealth is a holding proposition to create a land bank. John believes that putting your money in land is better than putting it in the bank. Get a copy of John's book by swinging by book stores near you or going to www.sevenstepstowealth.com

DISCLAIMER: The topics discussed in the video and its accompanying media are shared for general information purposes only, and should not be considered advice. For more information about investing in property, find out more about John Fitzgerald through his website at www.sevenstepstowealth.com