Building Wealth Through Investment Property

by Jan Somers

Building wealth through investment property

Genres: Business

191 pages, Paperback

Published January 1, 1993

About the author

Jan Somers is a mogul in the residential property investing community of Australia and is the author of a number of best selling property books. Beginning her career in teaching, Somers and her husband soon realised the incredible potential of property investing and this saw Somers transition to not only teaching fellow investors but growing their own portfolio which has seen them in the property game for over 40 years.

Reviews

[Jennifer · Rating 4 out of 5]

Negative Gearing.

A thorough manual of sorts to get into property investing. Picked it up second hand and it was what I had been looking for.

The prices are outdated since it was published in the 90s but the principles are what shine.

Its a no non-sense book that doesn’t fluff around and try to sell you with stories of how other people have benefited like books these days are written for social proof. Its solid and I totally appreciate it.

Now time to put the knowledge into action.

I tried to see if she was still active but looks like she may have stepped back from public life, otherwise I’d be keen to have her as a mentor as I embark on building my wealth through investment property. :)

Basically have a house in encumbered (paid off) and use it as leverage to buy another investment property where you get tax breaks for negative gearing (not making a profit now but intending to in the future). They key is to buy houses whether they be brick or weatherboard in areas with jobs (outskirts of major cities, sometimes large regional towns) where appreciation will happen with the land. Take out extra equity from the appreciated property and buy more investment properties. Don’t pay them off because you wont get the tax breaks. Keep your day job and just funnel all extra money into investment properties. The idea is that at retirement the properties in these key areas the property prices have had a chance to double (every 7-10 years) or triple (every 14-20 years). The original interest only loan you took out thats been being paid in part by you (from your after tax money from your day job) and the taxman (deduct interest as well as most costs of ownership and depreciation of repairs) and the tenant (through weekly rent) have been met and the principal is so low (from 10 years ago) compared to appreciated value now that you can enjoy positive cash flow. You can also sell off a property for a holiday or to clear out some of the debt but there’s not really any tax benefits from doing so.

[Reader · Rating 5 out of 5]

I was 30 when my brother asked me to read this book as I was earning ok money and throwing it all away on booze, pokies and anything else that came to mind at the time. 12 months later I owned 3 properties, the 3rd bought by the equity the bank had given me to grow my wealth. It’s important to say that I only started with a 10k deposit at the time. After being a workaholic my entire life and 6 properties later, I retired at 47 to follow a dream of sub dividing one of my properties and building a house I designed. When people say “I’m lucky”, I get very frustrated as it wasn’t luck, it was trust in what I learnt from reading this book and having a good Broker and accountant in my corner that steered me in the right direction every step of the way. I owe a lot to Jan Somers and my brother for the position I’m now in :)

[perro · Rating 3 out of 5]

It's an old book (1992). It is very specific to the Australian market. And some of the advice has to be taken with a grain of salt. For example, she continuously compares future behavior of the property market with previous outcomes. But overall it has some good advice for people interested in buying property. It gave a couple of things to think about. It is never too late to start investing.

[Jose Ortega · Rating 3 out of 5]

A straightforward and practical guide to property investment in Australia. While somewhat dated, its conservative strategies remain relevant for long-term wealth building.