This is the profile of the typical Australian property investor. Some of these points are fact, while others are unsubstantiated opinion - but mainly derived from general observation. Perhaps this creates a psychological picture of what goes through their mind, and why they thought buying rental properties was a good idea. Feel free to add to the profile.
The typical Australian property investor is...
- Employed full-time.
- Middle-class.
- Financially unsophisticated (as a result of being raised in a middle-class household with typical limited middle-class knowledge on wealth and finance).
- Has the burning desire to 'get ahead' in life and escape the dreaded rat-race but never quite knew how to. Untill...
- They attended one or more property investment seminar in the mid-2000's. Was awe-struck by the motivating and charismatic speakers. Was told that the secret to becoming rich was to buy houses. Lots of houses. This was their guaranteed path to riches, or atleast a comfortable retirement as they say. Their key to financial freedom had been unlocked.
- They read lots of investment books with titles such as "The Seven Secrets Millionaires Know But You Don't" and "Six Months To Financial Freedom".
- Believes that just because they read those books then that puts them above 98% of people in the country who haven't bothered to do anything about securing their financial freedom - because that's what the book says. Wow, what a start.
- Of course, only invests in residential real estate. Not commercial, not industrial, not other businesses, not shares (rarely). Just the trusty bricks and mortar - because it's something tangible. Buying houses must be a sure thing, because everyone has to live somewhere, hey?
- Believes that they, the almightly landlord, is much smarter than their tennents because the tennant is paying off the landlord's mortgage. Silly tennants.
- Will openly discuss/gloat their investment properties with friends at BBQ's. Often in a smug and almost condescending tone - because they believe the superior financial knowledge that they possess puts them in a higher social standing amongst their other middle class friends. Remember all the books they read?
- Counts the number of individual properties they 'own' as a measure of their financial success - and judges everyone else accordingly too. This is the top yardstick for the property investor and gives ultimate bragging rights at the next BBQ.
- Has probably attended further property seminars since. Because they managed to be one of the first 50 callers to receive free tickets, normally valued at $399. The other 800 people who showed up at the same seminar the following week must have payed a fortune.
- Is often a member of an 'investors club' or something similar - because it allows them to interact with other 'like-minded' people. Remember the all-important 'networking' that the property seminar speaker told you about?
- Can often be heard in the lunch room at work advising other colleagues to 'get on the ladder' before it's too late. They hand out this precious advice with an almost sympathetic tone - because in all honestly, they probably actually believe that this unfortunate person has genuinely missed the boat, such is the sheer level of delusion of the property investor.
- Also buys investment properties so they can claim a 'tax break', as they put it, so they can receive a large tax return on their middle-class income.
- Has never once wondered why Packer, Murdoch, Lowy, Forrest etc don't own 10,000 individual investment properties themselves? Nor did they ever start out that way. Nor did anyone else in the top 200 richest people in the country. Want to achieve financial success? Then don't follow what the rest of Australia's richest people do, apparently. After all - that's not what the book or seminar speaker said to do.
- Beholds the unrelenting and steadfast belief that house prices in Australia, under no circumstances, in any situation, no matter what troubles may lay, will NEVER, repeat NEVER EVER go down. EVER.
- All in all, they simply behold a bizarre level of delusion and unnatural certainty toward their investment strategy that can't even be explained - perhaps than to suggest that these people must be very easily led. They clearly learned, through their middle class upbringing, never to question anything or anyone. Oh, except for those who talk down property - because those people wouldn't have a clue.
