Simple vs Complex Property Investment Strategies: Which is best?

[arve url="https://www.youtube.com/watch?v=vJmExq_W8H0" mode="lazyload" align="center" /] You can invest in property using very simple strategies or very complex strategies. In this episode we look at the pros and cons of simple vs complex property investment strategies. Book a Free Strategy Session - https://onproperty.com.au/session 0:00 - Introduction 0:59 - What is a simple property investing strategy 3:15 - It doesn't have to be one or the other, you can do both 4:59 - Pros and cons of simpler strategies 6:33 - Short term complex strategies can be super successful, but also higher risk 8:33 - Simple strategies tend to take longer to make money 9:50 - Why we are so passionate about financial freedom and simple strategies 11:40 - Property investing as an insurance policy *new concept* 13:43 - Mixing simple strategies with complex strategies 15:33 - Having a supportive environment so you can invest successful with complex strategies 18:41 - Next steps to getting clear on how to invest in property Recommended Videos 2 Properties to Financial Freedom - https://www.youtube.com/watch?v=Pj8gLiDEz8Y Transcription: When it comes to investing in property, there's so many different ways you can invest. You can invest using really simple strategies and have success things as simple as buy and hold property, or you can invest using really complex methods, things like strata titling, commercial properties and development subdivision. There's so many different ways that you can invest. We want us to talk a bit about the pros and cons of simple versus complex property investment so you can get an idea of each and decide which strategy is going to be best for you. Hi, I'm Ryan from on Property Dot Com dot a u helping you achieve financial freedom. Today I'm joined by Ben Everingham from pumped on property. How's it going, Ben? Awesome, man. Hey Don. Yeah, very good. So you've done a mix of simple and complex investing in your own portfolio. Um, I know that you've done that with clients as well. Really excited to talk today about that idea of like simple versus complex. What's good, what's bad about each? So people can decide what's best for themselves. Yeah. So why don't we define what a simple strategy really looks like to you and me these days because simple 10 years ago looks very complex in terms of what I thought I needed to do. And simple today looks seriously simple. Yeah. Well, I think a perfect example of a simple investment strategy for me is the two properties to financial freedom strategy. Um, if you guys haven't seen that, then go ahead and Google it, you know, it will show up and you can watch videos on that, um, or I'll link in the description down below. But the basic concept behind that strategy is you purchased to high quality properties. You build granny flats on each of those properties. So you've got four incomes coming in and then you work to pay off those properties over time. And when they're paid off, you divert the money that was going to pay off those properties. And now all that rent is going into your pocket after the expenses of the property. And so that's just a pretty simple strategy because all you need to do is buy two properties or you need to do is then build to granny flats on those properties and then basically focus on paying them off. And so there's not a lot of complexity there. There's not a lot of niche skillsets that you need to have in order to pull off that strategy. Um, most people can do that, assuming they can get loans in order to purchase the properties and if they can save the deposits and most people can actually achieve that and achieve at baseline level of financial freedom. And then compare that to a complex strategy, which I remember talking to one of your friends or your wedding who was investing and he was started titling commercial properties, so he would buy 'em logic blocks of commercial property. So it might be, you know, in the corner where you've got five or six shops or whatever it may be, but it'd be under one title. Um, and he would then go about strata titling those properties and then selling them off individually basically. And so you just need a very different skillset and a more nice skillset around doing that. Developments, the same development, you can have high profit, but there's high risk associated with it. So you need to be quite a skilled in order to pull it off. I think like simple really, you can be a low skilled investor and have low risk and still have a good chance of success. Complex strategies tend to have more upside if you do it properly, but also more risk and you need to have more skills to do it. Yeah, it's an, it's an interesting one. Um, as you said, luck. I've executed on both strategies and what I wish I had known when I was just starting out or even middle of the way through my journey is, you know, it doesn't have to necessarily be one or the other. You can start with a foundation of a couple of really high quality properties with great longterm potential for capital growth. Great upside in terms of something you might be able to do to them in the future. And really strong cashflow maybe through a secondary dwelling on age. And you can lock away that foundation knowing that you're going to get there in the future, um, and then come back to sort of more complicated strategies if you want to or if you have the right skill set where you can make those shorter term chunks of cash over a one to 10 year period and use those jumps to pay off of debt. So, you know, I don't think there's anything necessarily harder about buying a home and chatting attendant in it, in the right area at the right time. Then there is the guy there and do a subdivision. But that's probably because I'm in the property space every single day. And you sort of learn the lessons with a good team of advisors around you. Um, oddest, think then something glossy, are excited about doing it the hard way or the big way or the risky way that a lot of investors get sucked into, particularly through like seminars or get rich quick vids and all that other stuff yet. But you know, most people that actually, it ended up much, much, much better off in Sydney 10 years ago. If they could have just bought two properties and held them, then I would have been from, you know, making 100 or $200,000 every year speculating all the way through and then, you know, losing some money at the top or the bottom or whatever. Yeah. So I think, um, let's look at some of the pros and cons of the simple strategy and then we'll look at pros and cons of the complex strategy. I think one of the pros with the simple strategy is that it's a lot easier for people to get into. So even buying your first property is going to be pretty overwhelming. There's a lot of stuff that you need to learn that you need to experience for the first time working with banks and with mortgage brokers, dealing with contracts, dealing with settlement periods, building and pest inspections. Like that's all sort of stuff that you never get to really experience in everyday life unless you work in the property industry and you've got to do that with a complex strategy as well. And then some. So I think simple strategy, the pro is that most people, the things that you need to learn can be learned quite easily or you can get through it without really knowing much. Like it's quite difficult, like you can stuff it up, but um, you know, it's a lot easier to wrap your head around. Market's really, really forgiving a simple strategy for a 10 to 15 year period where the market is brutal with a complex strategy if you don't execute it, let alone overlaying market condition at the time. On top of that. Yeah. And so simple strategy is that it's probably easier for everyday investors or people who haven't invest to start investing in using that strategy long term. It's probably more forgiving as well if you're looking at that like 10 to 15 plus year period, if be looking super short term, then I guess that's probably a more complex strategy anyway. You know, if you're a short term investor, which is completely cool, like I've got friends like Tim who was at my wedding, I'm like Michael who does a lot of speculating in my life and I look at them and I'm like, wow, it's crazy if you do it successfully, how well you can build, you know, paper wealth or cash in the bank to be able to do other things with. But man, it's dangerous for the average punter who doesn't understand it or you know, doesn't do the right due diligence or doesn't have the right team of advisors around them. Um, you know, I've got a client at the moment and she's an older lady from Sydney that you introduced me to and she's doing this very complicated strategy. I'm in south Brisbane at the moment on her own that she did before starting with us. And it's a one into full lot subdivision. It's taken a two and a half years longer than she expected. All of our cash has been tied up in it while she's doing it. And she stuffed up the feasibility, which means she's going to exit out at a loss after four years of her money. Now she's at a stage of life that it's very, very difficult to get that four years back then, you know, over 55 years of age for her. And she's also lost the opportunity to buy it, you know, close to the bottom and hold a couple of really good quality properties in some of the other markets in Australia. So, you know, it's, it's, it's can sometimes be a double edge sword. And I see people getting really attracted to something that's high risk because it's flashy. But the reality is I think people can do much, much, much better by having a baseline, you know, then then they'll ever get from just speculating all the way through and you know, talking to a 6,000 investors now, I think in the last five to 10 years. It's crazy. You know, after looking into their lives,