By Ozzie Jurock
This article appeared in The Vancouver Sun on April 3, 2004
This spring is a good time to reflect back on your finances in 2003. Did you have a plan to create unearned income in the future through owning rental property? Did you achieve it? If not, why not?
If you feel that you didn't achieve your goals, I can tell you that you that, in fact, you did.
According to the commitments you made and the actions you took, you have achieved precisely what you set out do to, or set out not to do Ė subconsciously.
So, before you go out and celebrate this great spring, spend some time to review 2003 with the goal to create a plan for 2004.
The key is to look over your last few years' goals to see what worked and do more of it. Also, see what didn't work and adjust your new goals accordingly.
We all know we should set goals. Our bank requires it for a loan; individuals need it to plan their future. Yet often we donít do it.
Start by dreaming big. Then, use your dreams to create your goals.
Write them down, and create an action plan based on the goals. It is important to commit yourself to the plan and do the work you committed to do. Measure the results as you go along, make adjustments and re-commit.
Business planning requires creating an action plan designed to spring our goals into life.
A plan leads the way to a course of action we understand and we can then go on and perform confidently, knowing that we will achieve it.
Human beings are goal-striving mechanisms. From childhood we want to explore, find boundaries and become better at what we do. Proper business planning allows us to first find a foundation rooted in reality and then create a roadmap to follow. Of course just having a plan isnít enough either. Business plan and goal setting are useless unless they are constantly committed to, and reviewed.
Here's the process: Commit ó perform ó and then ó measure.
If we fail to follow this formula, we are more likely to fail as personal managers of our life and of our new real estate action business.
Life is a wonderful journey, whether it is our personal journey or our business one. How we take that journey - consciously planning it and being pro-active in it, or reacting to a daily grind -- is our choice.
Goal setting makes our dreams possible. So, this year, do it. Donít just understand that you ought to.
Use this beginning of 2004 to measure the performance of your real estate action plan, your outcome and your actions.
Do plan your next 12 months. Write it all down and then hold yourself (or have someone else hold you) accountable.
The average human does not like to write plans down because plans can be reviewed. So, don't be average: write it down!
OK, what plan should you do if you want to make money on real estate?
Forget the fad downtown condo market, the "get rich quick schemes," it's smarter to invest for the long term. Note, the key word here is "invest."
If the goal is to have $1 million in cash in 20 years, here's how you can achieve it:
1. Buy five condos in growing urban areas such as around the Lougheed Mall in Burnaby, in the Fraser Valley, around Edmonton University, in Calgary, or in some good small towns. Remember urban real estate will always have a use and as such will not go down in value.
2. Buy into a good building (research it) and pay no more than $100,000 for each unit.
3. Get a rental income of about $800 for each condo.
4. Finance the purchase 100 per cent.
5. Own them in 17 to 20 years, clear title.
6. Get $4,000 per month income forever, even if rents never go up ó although you could raise the rent by 4.6 per cent this year. An income of $4,000 per month today would pay off a $1 million dollar mortgage. Presto! You are a millionaire!
So, get into action. Use the leverage of rental income. A plan like this starts you on the road to real estate investment success. Didnít do it in the past? Didnít stick to your plan in the past? Remember that your past in no way determines your future. This spring, hire the professionals, do some research, donít get swept up in the "multiple offer" euphoria. Invest in certainty. Get into unearned income Ė it will set you free.
For more real estate investment advice, visit Ozzie Jurockís website at Jurock.com
E-mail this story to a friend Print this story Save This Page to del.icio.us
Recent Articles by this columnist:
Debunking the Myths of Yuletide Home Selling
Mortgage Interest Rates - Whither Do They Go?
Should You Sell Your Old Home Before Buying a New Home?
What's a cap rate anyhow?
Developers ignore Feng Shui at their peril
All articles by Ozzie Jurock
Check out this week's Jurock Real Estate Insider Special deal
Have a real estate question? Ask an Expert