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The hardest financial lesson I ever earned came from the most valuable financial advice.
When I was purchasing my first home at 23, my dad explained the property cycle to me.
He said, ‘there will always be property highs and lows but if you hold onto it, the value will always go up. Be patient’.
Well, I purchased my first home in 1993 for $135,000 and at the time there was talk of the property cycle being seven years. Well, seven years later and with my second child on the way, I decided my dad’s advice was ‘poor’ as I had not seen any increase in the value of that property and decided to sell to increase our cash flow.
Over the next six months, I watched in horror as that same house doubled in value and then had a significant increase the following year. I had purchased in the ‘high’ and sold in the ‘low’. I received the message loud and clear, needless to say. My dad had tried to tell me that sometimes the cycle is a little longer and there was definitely an ‘I told you so father-daughter’ moment.
I was smarter the second time around. I watched the market to get a feel for the values in the location where I wanted to purchase. I could see a period of stability and just when there was a slight upward movement I purchased my second investment property. This time I did not have to wait long and property prices started to increase. I was fortunate enough to experience and profit from the property cycle’s upward cycle.
Well, today I am the branch principal with Yellow Brick Road Milton, located amongst the busy Park Road cafes and restaurants and I still haven’t forgotten that advice.
My dad worked hard all his life and made some wise financial decisions in his years. He is living comfortably in retirement but remains very active and involved in the local community by helping to organise local events, sitting on various committees and being part of local business and environment planning within the area. He enjoys sharing his life experiences with others to make a difference.
Thanks to dad and the lesson I learned, I now share my story with my children, family, friends and clients – hoping they won’t have to learn this lesson the hard way!
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