Having counted what I've invested and what I'm worth, I realise that I'm slightly below 5m of networth. Cashflow wise, I'm producing a nice number that's probably less than 500k. But I had to work so hard for it.
In order to move towards the 10m mark I will have to accelerate my pursuits. The more cashflow generating businesses and assets I have, the better I will be.
3m of net assets should generate roughly 150k of passive cashflow easily by right. If I work it right I should generate close to 250 - 300k of cashflow.
If I hit around 5m of net assets I should have around 500k of cashflow.
I have 2 properties that can potentially en bloc and harvest around 1.7m of equity. One of which is in Geylang which will probably happen in the next 5 years. The other one may take another 10 years.
Nothing block busting is going to occur the next 5 years unless I embark on a wildly successful business.
I realised that my return on equity is only 3.6%. Real estate alone is not generating enough cashflow obviously. Several issues came up:
1. Apartments in Australia were a let down. They were bought off plan and between 15 - 30% more expensive than existing homes. Capital gains were obviously poor because I bought them more expensive.
2. Rental yields were barely higher than interest rates. I forgot that in overseas, mortgage rates were usually much higher than the LIBOR or cost of funds.
3. Body corporate, or service charges were usually double that of Singapore's, thereby wiping out any cashflow.
4. Generally, apartments other than those in London, where capital gains were fabulous, were a let down. Luckily we turned to houses which provided ROE of around 10 - 15%.
From now on, we had to go for projects with higher ROE than 4%. Our development project in London yielded 20%.
I realised that my return on equity is only 3.6%. Real estate alone is not generating enough cashflow obviously. Several issues came up:
1. Apartments in Australia were a let down. They were bought off plan and between 15 - 30% more expensive than existing homes. Capital gains were obviously poor because I bought them more expensive.
2. Rental yields were barely higher than interest rates. I forgot that in overseas, mortgage rates were usually much higher than the LIBOR or cost of funds.
3. Body corporate, or service charges were usually double that of Singapore's, thereby wiping out any cashflow.
4. Generally, apartments other than those in London, where capital gains were fabulous, were a let down. Luckily we turned to houses which provided ROE of around 10 - 15%.
From now on, we had to go for projects with higher ROE than 4%. Our development project in London yielded 20%.
