Yes that’s right, 15 years. Talk about lazy! If you want “get rich quick” being lazy is not the way to go, you need to work at getting wealthy quickly. If you are happy to take things easy and slowly get wealthy, this is for you.
The Plan.
Buy a property every 3 years.
By 15 years you will have 5 properties.
Then every 3 years sell one and buy another.
That’s it in a nutshell, now let’s get into the detail.
Buy a property every 3 years.
You may be thinking “That sounds very proactive, I am too lazy for that” Well remember rule one, you must buy a property. All I am suggesting is do that about every three years. It does not have to be exactly three years, when the right opportunity shows itself, take it.
Examples of how this all works
Now Buy property 1 for $250,000
Year 3 Buy property 2 for $315,000
Year 6 Buy property 3 for $400,000
Year 9 Buy property 4 for $500,000
Year 12 Buy property 5 for $650,000
Year 15 Sell property 1 for $750,000 & buy property 6 for $750,000
$750,000 sell price
$250,000 less cost price
$500,000 Gross Profit
$ 30,000 Less buying & selling costs
$ 70,000 Less CGT (Capital Gains Tax)
$400,000 Net Profit.
That equals an after tax income of $133,333 per year for the next 3 years.
This is the equivalent of a PAYE employee on 30% income tax earning $200,000 Gross.
Year 18 Sell property 2 for $945000 & buy property 7 for $945,000
$945,000 sell price
$315,000 less cost price
$630,000 Gross Profit
$ 40,000 Less buying & selling costs
$ 88,500 Less CGT
$501,500 Net Profit
That equals an after tax income of $167167 per year for the next 3 years.
Year 21 Sell property 3 & buy property 8. etc, etc.
The above plan is just one way of doing it. Other ways could be 7 properties and buy and sell every 2 years, or maybe 10 properties and buy and sell every 18 months. The more properties you have and the longer you hold them, the more you make. I do suggest 14 years should be considered a minimum time to hold. This gives a greater chance of capital gain and time to ride any bumps along the way. It will also give you more rent to fund extra property.