The Biggest Property Investment Mistake I Have Ever Made

I’ve been working in property since 2005 and I bought my first investment property in 2010.

It’s been an amazing 20 years, with so many highs and lessons learnt along the way.

But inevitably there were mistakes, lots of mistakes.

Today I am revealing the biggest mistake I made in the hope that you will learn from it and make wiser, more calculated decisions.

So What Was That Mistake?

I should have retained my properties and not sold them.

I made the mistake of selling the vast majority of my properties. The gain was too enticing. I wanted the profit too soon in order to buy more properties. I was convinced there were better deals around the corner. When in fact, all things considered and the benefit of hindsight, I wish I still owned those properties.

Here are 7 reasons why I wish I had retained my properties:

1. Consistent, Increasing Income.

Long-term property ownership builds real wealth by providing consistent, gradually increasing rental income that can be utilised however you want.

Whether that is retirement income, lifestyle enhancement, paying for your children's education or something else, wealth comes from regular, growing income.

2. Long term wealth, not get rich quick.

Property will not make you a millionaire overnight.

But structured in the correct way, whilst making sound investment and financing decisions, it will build long term wealth for you and your family.

Wealth from the rental income and a portfolio that increases in value.

If you are looking to get rich quickly you should focus on building a business which you can sell or buying more lottery tickets!

3. The Power of Compounding Capital Growth

Property is one of the most effective ways to protect your wealth from inflation. As the cost of living rises, the value of tangible assets like real estate also rises.

If you have a fixed rate mortgage, your repayments remain steady while your rental income increases, improving your real return over time.

4. Protection Against Inflation.

Property is one of the best hedges against inflation. As the cost of living rises, so too does the value of tangible assets like real estate.

Meanwhile, if you have a fixed-rate mortgage, your repayments remain steady while your rental income increases, improving your real return over time.

5. Leaving a legacy.

We all know someone lucky who inherited properties from a parent or grandparent. Perhaps they have a portfolio which the whole family can dip into and reap rewards.

You can do the same by slowly purchasing good quality properties in good locations. Your family, and your much older self, will be incredibly appreciative of the wise investment decisions you made today, to benefit you all in the future.

6. Financial Stability and flexibility

Retaining your investment means enjoying consistent rental income that can provide both financial stability and flexibility.

Life has its ups and downs. You may lose a job or need extra money for someone’s health care. Perhaps you want to pay for a family member’s wedding or take your wife on a big trip to commemorate a special occasion.

Owning a property portfolio increases financial stability and offers you flexibility you may never otherwise have.

Over time, as your mortgage debt decreases and rental income rises, your cash flow improves, giving you an even greater passive income stream.

7. Reduced Transaction Costs and Tax Efficiency

Every time you sell or buy, you face costs.

Whether it's estate agent fees, legal expenses, Capital Gains Tax or Stamp Duty, there are always costs, and a growing number of them. Holding long term minimises these costs and lets your money keep working for you.

You can also explore tax efficient structures such as owning property though a limited company, LLC, Corporation or even a Trust.

Investing in property should always be regarded as a long term play, structured accordingly to suit your individual situation and your individual goals.

Happy investing!

Michael Sacks