5 property investment lessons from Warren Buffett

  1. “Someone is sitting in the shade today because someone planted a tree a long time ago”

Trees don’t grow overnight and neither does wealth.

The only way to ensure your “shade” today is to build your wealth slowly, over time.

Well planned and purchased investment properties are among the lowest risk investments when held in the long term and for this reason, we recommend holding property for as long as you can.

This chart shows the continuing growth of house prices over time. The timing of purchasing your investment purchase quiet often doesn’t matter – if you paid “top dollar” for your property back in the 1990’s – you will have enjoy increased capital growth.

Sources: ABS; APM; CoreLogic RP Data; RBA

So what do we think? Don’t wait to buy real estate, buy real estate and wait.

 

  1. “It is not necessary to do extraordinary things to get extraordinary results”

 

We like this quote because our clients can often feel that they’ll need to change their whole life to afford to buy property. In reality, setting achievable goals with actionable steps is the best way to ensure results. A budget and a plan to save is simple to create and implement, it’s the discipline to stick to it which is challenging.

Achieving consistent results with your spending and saving, time and time again, will ensure you eventually achieve the extraordinary feat of home ownership.

The value of time and persistence is not to be taken for granted.

 

  1. “Predicting rain doesn’t count. Building arks does.”

 

This a great quote to bust out at family barbecues when your uncle starts ranting about “hot spots” in property. No one has a crystal ball to see into the future and making claims without actually backing it makes your claims worthless. If your uncle truly believed in the next “hot spot”, he’d be putting his own money into it.

Instead of talking about what may or may not happen, set some targets for yourself and get it done instead.

 

  1. “You don’t need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ.“

 

There’s no need to be a genius to invest in property. The person is who is most successful with investing is usually the one who actually did something as soon as they could.

Trying to learn everything or “timing the market” (might only be serving as excuses you’ve made to stop yourself from taking the leap and actually getting into the market.

Don’t worry about being the most clever person regarding property. Do your homework and hold the property long term for successful investing.

 

  1. “The investor of today does not profit from yesterday’s growth.“

 

Umming and aahing over getting into the market is only costing you money. To start making a profit on your property, you need to actually own it!

If the area you’ve been looking at today is seeing fantastic growth but you’re yet to own a piece of it, then that growth is pointless to you.

To reap the rewards of growth in an area, you need to own property there. Otherwise, the growth means nothing of value to you.

 

Conclusion

 

There’s a common theme in these quotes, aside from them coming from one of the most iconic investors of our time.

If there’s one thing we can learn from Warren Buffett, it’s that the best strategy for investing is simply to get into the market whenever you can.

Waiting for more time to pass serves no purpose and only reduces the potential growth you have to gain. You don’t need to be the most analytical person or do anything extraordinary to get results from investing in property.

Are there any other quotes from Warren Buffett that you love? Reply below to share them with me!

 

By Joshua Boctorani

 

About the author

Joshua Boctorani has long been involved in Australia’s finance and property industry, with more than 13 years of experience. He is now the co-founder and Managing Director of AssetBase. Josh takes great pride and pleasure in sourcing great property deals for purchasers across various states in Australia.

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About the author: TPI Editor

Kizzi Nkwocha is the editor of The Property Investor and publisher of The Sussex Newspaper, My Well-Being Magazine, My Making Money Magazine and My Entrepreneur Magazine. Kizzi Nkwocha made his mark in the UK as a publicist, journalist and social media pioneer. As a widely respected and successful media consultant he has represented a diverse range of clients including the King of Uganda, and Amnesty International. Nkwocha has also become a well-known personality on both radio and television. He has been the focus of a Channel 4 documentary on publicity and has hosted his own talk show, London Line, on Sky TV. He has also produced and presented both radio and TV shows in Cyprus and Spain. Nkwocha has published a number of books on running your own business and in 2011 his team won the Specialized Information Publishing Association (SIPA) award for best use of social media. In the UK he runs a successful media consultancy called PRHQ which manages PR for businesses and individuals.

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