In catching up with our personal ASB banker for lunch today to discuss whether to float or fix some of our mortgages, I actually took the time to consider just how low the retail interest rates are. Twenty-four years ago when I bought my first home in Whakatane for $55,000 with interest rates at 20.5 per cent, we never dreamt that we would ever see rates at a quarter of that! Well how times change, and I would have to say that I came away from our meeting thinking that if we are not seriously thinking about borrowing more money for property investment then we would have to have rocks in our head – quite inspiring actually.
With opportunities still presenting themselves to acquire property at reasonable figures coupled with rental returns beginning to show positive cash flows, I am thinking such scenarios have to definitely go into the “serious consideration basket”.
Robert Kiyosaki in his book Cashflow Quadrant (his sequel to Rich Dad, Poor Dad) provides some sound advice:
Stop waiting for the ‘big deal.’ Get into the ‘game’ with small deals (like my first small condo that allowed me to start investing for just a few dollars). Don’t worry about being right or wrong at first, just start. You’ll learn a lot more once you put some money down … just a little to start. Money has a way of increasing intelligence quickly. Fear and hesitation retards you … but you must start.
It really is about having a plan and making a conscious decision to take action. The seed was sown today for such a plan and it all makes so much sense.
