12-Month Real

Estate Millionaire

Mark Rolton
Part #1: My Million Dollar Profit Story

Table of Contents
Forward ........................................................................................4
About the Author .........................................................................9
About this Book ..........................................................................11
It All Starts in Your Mind ...........................................................15
You are what you think .......................................................................................15
What questions are you asking? ..........................................................................16
A new approach to wealth ..................................................................................17

What is Money? ..........................................................................20

A case for karma? ................................................................................................22

Cashflow from Control? .............................................................25

Developing short-term cashflow ..........................................................................26
Options give you time .........................................................................................26

12-Month Real Estate Millionaire - Part 1

Copyright 2012 by Mark Rolton

All rights reserved.
No part of this book may be reproduced in any form or by any electronic or mechanical means
including information storage and retrieval systems, without permission in writing from the author.
The only exception is by a reviewer, who may quote short excerpts in a review.
Distributed by Knowledge Source

12-Month Real Estate Millionaire - Part 1

Forward
These days it seems that real estate is the the flavour of the month. Whenever
you turn on the TV there is a never ending line up of documentaries and reality
TV shows all designed to tap into our insatiable appetite for real estate. From quick
makeovers to uncovering the history of the family home, and from rescuing an old
place that is about to fall down to renovating the backyard, the viewing public can't
seem to get enough.
And for good reason. You see, this all has to do with what we call the Great
Australian Dream.
It all started back in the days after the end of the Second World War when
reconstruction was the name of the game. The emphasis was on expanding the
Australian economy and getting things back to normal as quickly as possible. This
industrial boom provided much needed work for the hundreds of thousands of
men who had retuned from the battlefields of the world, keen on progressing from
where they had left off before joining up. The baby boom was well and truly
underway and most people found they could now, for the first time, own a car. This,
together with the dropping of rent control, gave rise to a housing boom the likes of
which the nation had never experienced before.
Suburbs were being built at an astonishing rate further and further from the
CBD than ever before and this, together with the inherent pioneering characteristic
of the average Australian, led to the growing ambition to own their own homes.
Back then it was considered to be quite the thing to have a detached brick home on
a quarter acre block with a Hills Hoist and a barbecue in the backyard.
Within 20 years of the end of the War, a staggering 70% of the population
owned their own homes. This had become something to which every Australian
aspired. They regarded it as their right to own their own little piece of paradise.

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The family home had well and truly become entrenched into our way of life.
But the interesting thing is this: not only did owning your own home become a
symbol of achievement and financial security, it also became associated with a very
particular way of life. You see, once you had acquired your own home, you soon
found yourself hankering after those other little status symbols that were very in
vogue at the time: things such as the ubiquitous Victa lawnmower and the latest
Holden or Ford motorcar. Then, as you progressed up the social ladder, you
invariably found yourself taking your family away on holidays to the seaside,
thinking about putting in a swimming pool and buying a second car.
Life in Australia just couldn't be better.
As we moved through the 1970's, 80's and rushed headlong towards the end of
the tumultuous 20th Century, my impression is that the average Australian (if there
can be such a person) had become so much more sophisticated financially. Our
standard of living had become one of the highest in the developed world, but this
was a two-edged sword.
There was a general realisation that most people would have to take
responsibility for their own retirement and not rely on the government pension.
The unprecedented growth of the population, together with its skewing to the
older side of the age spectrum, meant that government fiscal pressures would be
hard to ignore. Smart people started looking for ways to shore up their own
financial futures.
Australians had become more financially savvy. They started attending wealth
creation seminars and got to understand the in's and out's of the two main avenues
for investing: the stock market and the real estate market.
Things were beginning to move and the nation became wealthier. The mining
boom brought with it unprecedented wealth, not only for the nation as a whole but
for the average Australian in general. Owning a second, or a third, property as an
investment was no longer the exception but the norm.

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The game was well and truly on.

Financial advisors, commentators, coaches and mentors began pushing real
estate as the only sure investment option for the long term. The inability of the
housing construction industry to keep pace with demand for new houses saw
upward pressure on house prices, which was exceedingly good news for investors,
but not such good news for those who still had to buy their own home. Rents began
climbing and renters began making serious moves to get into the property market
before it was too late.
This was the general sentiment as we moved from the 20th into the 21st
Century. The notion that investing in the real estate market was the wisest and
surest thing anyone could do was well understood by now, even by those who knew
they had missed the boat by leaving it too late.
By the time we entered the second decade of the 21st Century, many industry
insiders and financial commentators started pointing out that just because many
people identified themselves as landlords, it didn't mean they made money from
their real estate investments. In fact, some went so far as to suggest that the
majority of them would be lucky to break even at the end of the day.
The point is taken. I mean, with so many people now owning at least one
investment property, why then aren't they feeling secure financially? If you think
about it for a moment, you'll soon realise that with easy access to funding by
tapping into the equity that was suddenly available as a result of the property
boom, every man and his dog rushed headlong into the market and bought up just
about everything they could. This further exasperated the supply and demand
equation and pushed up prices even further.
However, things were about to take a turn for the worse. With the collapse of
Lehman Brothers, the fourth largest investment bank in the US back in September
2008, the world suddenly came tumbling down for those who had bitten off more
than they could chew. People who had borrowed more than they could really afford
found themselves having to pump more funds into their loans. Those who couldn't
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had to sell at whatever price they could get. The property bubble had well and truly
burst.
Real investors, those whose investments were based on solid fundamentals,
found this sudden change of fortunes played right into their hands. The market
had changed overnight into a buyer's market.
Talk on the street would have most people believe that the real estate market
was to be avoided as an avenue for investment, at least until things had straightened
themselves out and retuned to 'normal'. Once prices started to move, they said,
then it would be time to jump back in and invest again.
How wrong they were.
All the so-called serious investors know that the time to buy is when prices are
down, not up. That's when fortunes are made. It's the same with the stock market.
Only a fool would clamour to buy shares when prices are at a peak, yet that's what
so many do. The simple fact of the matter is this: you don't know what you don't
know. If you knew better, you'd hang on to your holdings and add to them when
prices are down, and only sell when the market rises. That's logical, isn't it? Sure it
is. But here's the thing: most people simple know no better; they follow like sheep
and wonder why they get burned.
You simply can't afford to underestimate the value of knowledge. How do you
acquire knowledge? Through education. I know some people say experience is
another way, but to my way of thinking, this usually brings knowledge when it's too
late to do anything about it. And it really doesn't matter in what field we are talking
about, the same holds true. If you want to become an engineer or a doctor when
you leave school, you have to go on to university and study. There's no getting away
from it. It's quite accepted in society, isn't it? Why then should it be any different
when it comes to the wonderful world of real estate? The more you know and
understand about how the real estate industry works, about how the world of
finance works and about human nature works, the better off you'll be as an
investor. It's as simple as that.
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The good news is that is doesn't take being a genius to succeed in real estate.
You certainly don't need impressive academic qualifications or even a high intellect.
All it takes is a will to succeed, an open mind, some diligence and the wish to learn
from those who have already succeeded. There's nothing quite like 'on the job'
training, the sort a good mentor will provide.
The thing that puts most people off following this route is usually that the
barrier to entry into this market is high. Real estate doesn't come cheaply. But the
good news is that, if you listen to the experts, you'll learn that there are ways
around this. You'll discover what we call quick cashflow strategies that can be very
effective in getting you up and running with little or no money at all.
I have found, too, that in order to make real headway, it's not necessary to follow
the pack and do what the vast majority of investors are doing. That way is a sure
way to end up with the same results they currently achieve, and those aren't very
impressive at all.
I decided to find mentors from among the most successful in the game and learn
from what they are doing. What I discovered is the subject of this book.
I trust you'll find reading this book just as stimulating as I have found writing it.
If you take onboard what you are about to learn and then apply it to your own
situation, you'll be sure to achieve results beyond your wildest dreams. I did.
So congratulations on buying this book, it may turn out to be the wisest thing
you've ever done.

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About the Author

By way of introduction, I became a millionaire by age 30. I am also an ironman
tri-athlete, an adventure racer, a keynote speaker and an avid helicopter enthusiast.
I mention this not to impress you but to impress upon you that the level of my
success in life can be yours too. You see, before I became successful as a
businessman, I was just an ordinary Aussie bloke.
My story really began when I was working as a builder and my company was
embezzled. Finding myself in debt to the Australian Taxation Office to the tune of
$420,000, I decided to do something about it and started washing windows to
generate cashflow. Slow as the progress I was making towards paying off my debt
might have been, I knew I was at least moving in the right direction.
Then one day, out of the blue, fate intervened. I received a phone call from a
developer named Brian. Did I perhaps know anyone interested in buying six blocks
of land that he had for sale, Brian asked? No I didn't, but I'd see what I could come
up with, I replied. Then as if by divine intervention, I received a call from Stuart, a
financial planner who happened to mention in passing that he was on the look out
for six blocks of land. Quick to recognise the potential, I rang a solicitor to find out
the best way I could structure a deal that would satisfy both parties. The result was
an option deal that netted me $42,000.
Excited by what options could do for me, I then optioned a large site which was
sold to a developer 33 days later. My profit from this one deal amounted to a cool
$1,066,000 and saw the end of my indebtedness.
Since that moment, I have achieved amazing success. The result was the
establishment of MassLand Group, an organisation that focuses on the
development of budget housing. I saw an opening in the market for refreshing and
innovative planning toward high density living and the need for price-sensitive

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housing solutions. The result was a highly-tuned skill for developing keystone
projects with the emphasis on innovation rather than reduced quality.
Clearly understanding the risks faced by developing projects, I began to
promote options as a profitable and viable way of creating wealth through real
estate. I became a pioneer in the field of options.
I am now regarded as the Number One authority on property options in
Australia. Due to my phenomenal success, I have developed a thriving educational
arm to my business that teaches others how to capitalise on the use of options to
generate cashflow.
I am known as a charismatic speaker who is truly passionate about property. I
explain options in easily digestible pieces that can be understood by both novices
and sophisticated investors alike.
I regard myself as dynamic, determined and down to earth. My revolutionary
view of real estate has seen Massland Group grow into a cutting edge organisation
with an impressive property and development portfolio. My success in this field has
resulted in me rubbing shoulders with the likes of Robert Kiyosaki, Donald Trump
and Richard Branson, and for that I feel blessed.
Through this book I would like to ignite a passion for doing real estate the
option way. I wish you all the success in the world and know that, through
diligence, perseverance and hard work, you too can achieve what I have.

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About this Book

One thing I've learnt in life is that unless you actually roll up your sleeves and do
something, nothing will happen. If you want to change your life or the situation
you find yourself in, you have to actually DO something about it.
But there is another important thing I learnt and it's this: A while ago I had just
bought a beach house and had $6 million in the bank yet I wasn't happy. That's
when I sought the help of Scott Harris, a business coach who has since become a
great friend. Scott gave me some great insights into the human condition and
taught me that it really is alright to seek advice, ask for help and receive
encouragement. He allowed me to understand that all I had to do was to push my
ego to one side, acknowledge that I needed help and approach things with an open
mind.
I learnt then that understanding that I didn't know it all and could do with a
healthy dose of humility would stand me in good stead. You see, I am a builder by
trade and used to doing things for myself. But that alone didn't qualify me to earn a
living from investing in the real estate market. Sure I understood how to build a
house or unit, but I sure as hell didn't know too much about the world of investing.
I wasn't happy.
I learnt back then that money itself doesn't bring happiness. For me, that would
take a whole lot more of the things money can't buy. Things like helping hundreds
of people to achieve financial freedom for themselves and their families. Things like
turning an idea into a residential or commercial development that would benefit
the local community for decades to come. Things like being able to bring joy and
hope to disadvantaged communities in far flung corners of the world.
Understand that money on its own can't give you these things. Sure it makes
them possible, but only if you actually DO something with it. It'll achieve nothing
at all sitting in a bank account, except to earn some interest.
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I learnt that I had to do something to improve my situation instead of sitting

back, complaining or hoping that somehow things would miraculously improve.
Just by buying this book and beginning to read it tells me that you are hungry
for change and capable of making important decisions for yourself. So
congratulations, I know you won't be disappointed.
By the time you reach the end of this book, you will understand the most
powerful tools available to the most successful real estate investors in the world.
You'll have a good understanding of the strategies used by the very best in the
game; people like Donald Trump and Robert Kiyosaki to mention but a few.
Another thing I have learnt is that I am not a great theorist, but rather a great
realist. That is why I aim at 'telling it like it is' in this book. By writing this book I
want to show you how to make more money. It's as simple as that.
By reading this book you'll learn, just as I did, that being truly affluent is not
something reserved for people like movie stars and professional athletes; it's for
anyone who has taken the decision to be wealthy.
Understand this: wealth isn't about how much money you make; it's about how
much you keep. If you spend more than you earn, all you'll achieve is going broke,
unless you change your ways real soon.
By the time you reach the end of this book, you'll understand that all the best
purchasing techniques and the most effective investment strategies on their own
won't work unless you know WHY you are investing in real estate. You need to
have a very clear understanding of what your motivation is. I can show you the
HOW, but that's not the really important part. You need to figure out the WHY
first, before you dive in and begin developing strategies to create wealth.
When it comes to wealth, thinking matters.

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This book will show you how to take the amount of money you earn each
month and make more money through real estate, often without ever actually
outlaying or risking any of it. But that's not all you'll learn. This book will show you
how to generate cashflow through real estate, which is, of course, the name of the
game.
By the time you reach the end of this book you'll understand that your wealth is
measured by your holdings. You'll realise that because the value of cash diminishes
as time goes by, the secret to amassing wealth lies in your ability to acquire and
hold as much real estate as possible. You'll learn, just as I did, the true value of real
estate assets.
I bought my first investment property when I was just 16. Can you imaging my
parents' reaction when I went to them and explained that I needed them to act as
guarantee for the loan! I still don't know if they were horrified or quietly impressed
at the time, but I now realise it was highly unusual to say the least. I knew
absolutely nothing at all about real estate, let alone investing. So if that's how you
feel right now, don't worry; this book will give you the formula. If you can buy just
two properties a year for ten years, then begin selling the ten you owned the
longest, you'll end up with a significant portfolio that should give you financial
independence for life.
By reading this book you'll get to appreciate that real estate is tied to inflation,
and as such, if you don't own at least one property, you're as good as dead in the
water.
This book is about understanding HOW serious investors make serious money
from real estate. It's about telling it like it is in easy-to-understand terms. It's about
inspiring you to change the way you think. It's about challenging you to be the best
you that you can be.
This book is not intended to be a literary masterpiece. It is intended to be a noholes-barred approach to the wonderful world of real estate investing.

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This book is about changing your views about money and success. By the time
you reach the end, you'll no longer be afraid of BIG numbers very big numbers.
It's about how to become wealthy through investing in real estate in as little as five
to eight months.
So let's move on, there's no time to waste ...

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Chapter 1

It All Starts in Your Mind

They say the mind is a wonderful thing. I couldn't agree more. You see, take
away a person's mind and what are you left with? Not a lot.
The mind, and what goes on in it, has been the subject of vigorous debate for
probably as long as there have been intelligent people on this earth. The famous
French philosopher Ren Descartes (1596 1650) summed it all up brilliantly with
this quote, "I think, therefore I am."
When you think about it, if you don't, or can't, think, then you really don't exist.
If you can't think, how would you even be able to know that you did, or didn't,
exist? This is a fascinating question that leads on to another proposition that is
directly relative to us as property investors. It is this: the quality of your existence is
directly related to HOW you think. The level of your thinking will influence the
level of your existence.
Think about this for a few moments. What do you spend most of your time
thinking about? What kinds of thoughts do you fill your mind with?

YOU ARE WHAT YOU THINK

If you spend your time thinking that you are poor, guess what? You will be poor.
If you think that you aren't destined to be wealthy and have to work really hard for
every dollar you have, guess what? You will.
Our thoughts really do have a great influence on your lives. You've no doubt
hear about the Law of Attraction. Well, in essence this Law says that you'll get
more of what you spend your time thinking about. The way it works is this: if you
spend most of your time thinking that you are successful at work, your mind will
begin to accept this as a fact and you'll start acting as if you are already successful.
This is because the brain has no real way of distinguishing between what is real
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and what isn't, other than by using its powers of reason. But if you continually
think that you are successful, then your brain will find it hard to reason otherwise
unless it comes up with more compelling arguments to the contrary. It will then
start looking for evidence to back up what it's being told. If it finds any, this will
reinforce its belief that you really are successful.
But here's the interesting thing: the more you tell yourself that you are
successful, the more you'll behave as if you are. You will carry yourself like
successful people do, you'll dress like they do, you'll talk like they do and you'll start
hanging out where they do. Others will notice and assume you are successful and
begin treating you as such. Opportunities will start coming your way. Those who
are already successful usually don't associate or do business with those who aren't.
People do tend to stick together with like-minded people. Every noticed that?
I realised long ago that if I wanted to become successful -- really successful -then the place to start was with my mind.
It's the same with creating wealth.

WHAT QUESTIONS ARE YOU ASKING?

A wise man once said to me, "If you want a better answer, ask a better
question." But there's the thing: most people go wrong because they ask the wrong
questions. The main question on their minds is, 'What do I have to do to become
rich?' They should be asking themselves instead, 'Who do I have to become to be
rich?' The next logical question they need to ask is, 'Why?'
Understand this: when a sports team does badly it's never because the players
have forgotten the strategy, the rules or how to play the game, it's always because of
what's going on in their heads and hearts.
Wealth is something that happens in the mind. Money is all about how you feel.
If you can get your head around these two important statements, then you'll find
moving on from here is going to be a whole lot easier.

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If you are going to close the gap between where you are now and where you
want to be in the future, you are going to need clarity and a clear vision. The way
to achieving these is through asking great questions.
To me, this is of vital importance, especially considering that we are all going to
have to handle our financial affairs for the rest of our lives. Like it or not, money is
going to feature heavily in our affairs on a daily basis, so why shouldn't we develop
an aptitude for it?

A NEW APPROACH TO WEALTH

Developing wealth through investing in real estate isn't new, millions of people
have been doing so for a very long time. But what is new, at least to the masses, is
the approach real estate moguls and tycoons take when it comes to amassing their
fortunes. They have a rather unique understanding of the property market and are
able to leverage it to provide maximum benefit without risking much of their own
capital.
The real difference between them and the average investor is the way they view
real estate. They understand the value of CONTROL as opposed to
OWNERSHIP. You see, when approaching real estate with the view of controlling
an asset rather than paying for it, it opens up unlimited access to wealth.
Can you see how, as a traditional investor, you are limited by the amount of of
money you have available to put down as a deposit as well as your ability to service
loans? Can you also see that there is actually no limit to how much real estate you
can control?
If this way of thinking is new to you, don't worry. Read on, you're about to
discover some of the most powerful real estate secrets the world has know. But it
isn't new. The world's most famous investors have been using it for decades.
Can you see how, through controlling real estate assets and creating a sizeable
portfolio, a whole new horizon will open for you? Control works on an entirely
different level to the more traditional ownership model. For starters, what you need
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when seeking to control a real estate asset is TIME. With time, you can set about
adding value to an asset through, for example, development. The strength of this
approach lies in the fact that you can afford to offer a lot more than market value
for any property as long as you get time in exchange.
Can you see how this represents a far greater opportunity to the investor than
investing through the traditional model does?
Empires have been created by an innate ability to recognise the time represents
more value than money. With time, the real estate mogul is able to add value to the
asset under his control before realising the profits when the time is right.
The way the real estate mogul approaches the property market is totally
different from that of the traditional investor. The mogul continually questions how
to create even greater value. The mogul understands that the key to wealth is the
questioning process. The better the question, the better the result, and the profit, is
bound to be.
The mogul's approach is to understand that anything is possible, provided it is
solution-oriented. The sorts of questions they ask are:
How do I maximise this transaction?
How do I offer more value to the owner in exchange for time?
How do I meet the Council's requirements and exceed their expectations through what I offer?
How can I create an even stronger yield from this deal?
An interesting benefit that comes from asking great questions is the ability to
solve problems. And this, of course, is one of the great characteristics of successful
entrepreneurs. By continually seeking answers to probing or profound questions,
they are able to foresee solutions to unexpected problems or new challenges. This
gives them the ability to proceed with their ambitions, meet the obstacles and
challenges that come before them and achieve their goals. This is what makes them
unique.

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Chapter 2

What is Money?
Do you buy into the commonly held beliefs that money is evil, that money is
dirty and that money corrupts? If you do, then it comes as no surprise to me that
you find it so hard to make headway financially. You see, money at it's most basic
level is just something that we have created. It has no life of its own. It has no
magical powers. It has no qualities other than the stuff it is made of.
Think of money as a tool that provides you with the ability to choose what you
want.
Money gives you choice. The more of it you have, the greater the level of choice
you will have to do the things you want to do, when you want to do them.
Money is meant to exchange hands continually too. Money, as the old saying
goes, makes the world go round. It does so by being in circulation. Sitting still in a
shoe box, or bank account for that matter, it's of no use to anyone. Take during the
Global Financial Crisis of 2008, for instance. People were frightened so much that
they stopped spending. So too did businesses. What happened? Things got worse.
Consumer confidence plummeted, businesses stopped hiring and whole economies
ground to a standstill. Yet people actually got richer. Their bank accounts were
bulging and their levels of debt were at extremely low levels. This may have seemed
dead right as far as those individuals were concerned, but the downward economic
spiral inevitably caught up with them. Government's knew that the way out of this
mess was to stimulate consumer spending and so introduced various stimulus
packages.
The message here is that money is only of value (or use) if it is spent. And if it is
spent, it has to be replenished all over again, doesn't it?
The question now becomes how to create more money for yourself.
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Those who don't have much of it are the one's who hold onto the belief that
you have to work hard for your money. What rubbish. That may have been true a
hundred years ago but the world has moved on since then.
Those who have loads of money know that creating money really is a skill. Not
only that, they know that it is a skill that can be learned.
I, like many others, believe that property is the best way to make money. For me
it's a no-brainer but sadly it doesn't appear to be so for the vast majority of people.
When I look around me I see that most people seem to spend their entire lives
looking for easier ways of making money. I see a world affected by the lack of
money. I also notice that, strange as it may seem, money doesn't seem to affect most
people, who appear quite content to go about their daily lives without focusing on
money as such. Opportunities pass them by all the time and they don't even notice.
Yet their lives are very definitely held back by this thing we call money.
Have you ever noticed that people tell lies about money all the time? They lie
about how well they are doing, about how much they earn and about how much
are worth. I believe they lie about money simply because they let their egos get in
the way. But here's the thing: life isn't a dress rehearsal. It's for real. And it's the
only one we have, so why not make the most of it? The sad reality is that most
people simply aren't; statistics tell us that at age 65, 95% of all Australians will be
dependant on someone else, and only 1% will be financially secure.
So what does money mean to you right now? Think about this for a moment.
Has it caused you pain in the past? How many hours a day have you had to work
just to keep your head above water? How many weekends have you had to
sacrifice? How has money impacted on your relationships?
Understand this: you are were you are right now and not at the next level
because there's some stuff going on in your head. It's time you begin to explore
your ideas about money. What emotions does the word evoke? Are there any
negative or limiting beliefs that you have about it? If there are, then chances are

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this is what's holding you back. You need to be brutally honest with yourself about
money.
Think about what a huge difference an extra $1,000 a month will make to your
life. In fact, it will probably change it drastically. It will, for instance, allow you to
hire a full time housekeeper. What difference would that make to you and your
family?
Let your imagine run wild now for a moment. Build a vision about your ideal
life. What would make you say that is a life worth living? Be specific. Know the
numbers. Get excited. Get motivated to make it happen.
Having just read the way I see it is sure to challenge some of your beliefs. If it
has, great. You see, one thing's for sure: you are where you are today financially
precisely due to your views of money. If you want to change this and become
wealthier, chances are you are going to first have to work on changing your attitude
towards money.

A CASE FOR KARMA?

Karma is a fashionable word these days but do you know what it actually
means? Do you understand its implications for you as a real estate investor?
The word karma is ancient sandscrit and it was used in Indian religions to refer
to actions that cause the entire cycle of cause and effect. In Western society the
concept is also well established. You have no doubt heard the saying what goes
around comes around. You've probably also heard live by the sword, die by the
sword. What about reap what you sow? These are all very old and well-embedded
sayings in our language and cultural system, aren't they? We all know them and,
perhaps more importantly, understand what they mean.
They all have to do with the basic Law of Cause and Effect. Perhaps the Dalai
Lama sums it up best when he said happiness is not something ready made. It
comes from your actions.

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Let's take a closer look at this concept now to discover a little more about it and
how it affects us as real estate investors.
The Law of Cause and Effect tells us that if we exert some form of pressure on
an object, it will move as long as the force is greater than that which causes it to
remain at rest. Overcome the effects of gravity, friction, etc and the object will
begin to move. But if you did nothing, nothing will happen.
Looking at this from another perspective, if you require something to happen,
you need to do something. This means, in practical terms, that you are where you
find yourself today because of the actions you have taken in the past. For instance,
you graduated from school and went on to university, studied engineering degree
and passed. On obtaining your degree, you were hired by a firm of engineers and
began rising up the corporate ladder to the position you find yourself in now. Had
you chosen not to go to university, you wouldn't be where you are today. Also, had
you gone to university but chosen an arts degree instead, you similarly wouldn't be
where you are right now.
Understand? Or as I like to say, capish?
So what does all this have to do with investing in the real estate market? Well, it
means that if you want to keep getting the results you always have up until this
moment, then keep doing what you always have and you'll do fine. However, if you
want to get different results -- if you want to earn way more money, for instance -then the last thing you'd want to do is keep doing what you always have. You'd
want to do different things, wouldn't you? Of course you would. That should be
obvious to you by now.
The question now is this: to get different results you need to do things
differently. But if you knew WHAT to do, then you'd probably already be doing
that. Here's the thing: you don't know what you don't know.
My message to you at this point is this: to achieve vastly different financial
results, your behaviour needs to be vastly different to what it has been until now.
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Capish?

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Chapter 3

Cashflow from Control?

Just as in business or any other aspect of life, cashflow is the name of the game.
Without cashflow, everything grinds to a halt.
With real estate, it's no different.
It goes without saying that when it comes to wealth creation, your focus should
be even more finely focused on cashflow because without ensuring there is a surplus
come the end of each month, you will have nothing to build your wealth with.
I know this from experience. You see, I used to be a great spender. I used to
frequently spend more than I earned each month, leaving me with a growing
problem that I tried not to think about. As long as it was a case of life as normal, I
didn't think about the sorry state of my financial affairs. I got on and lived life.
I've since learnt to be prudent with my money. I learnt to treat money with care
and only to spend or commit it after considering the future. Once I had changed
my financial ways, it was as if I was seeing the world through a new set of eyes. I
suddenly realised how easy it would be to make real progress towards achieving my
financial goals.
This new approach has really changed my life. I recently bought a brand new
Ferrari and paid cash. You should have seen the look on the salesman's face when I
said I would take the car and pay cash. I could tell it wasn't everyday that someone
walked in and bought one of their cars for cash.
Most people spend their money even before they've earned it. The reason they
do this is because they are 'keeping up with the Joneses'. I guess this is partly a
consequence of our consumer society which encourages continual spending,
upgrading and always needing to have the latest.
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This isn't the way of the entrepreneur. And it shouldn't be your way either.
Understand this: when it comes to financial affairs, only YOU count. Not the
Joneses, not your neighbours, not your colleagues, only you. Your best interests
must come first as you are the one who has to ensure your finances are in good
enough shape to provide for you for a very long time.
Capish?

DEVELOPING SHORT-TERM CASHFLOW

As with anything in life, you have to start somewhere. It's the same when it
comes to making a start in the real estate market. But before you can kick things off
and begin building a portfolio, you need to have a certain amount of capital
available. This usually means cash, or access to it.
So how do you go about acquiring this without risking everything you have
achieved in life so far?
When using real estate for short-term cashflow, it's about extracting value from
properties that may not be obvious to the naked eye. It's about taking a property
and realising value from it. This can easily be done in a variety of ways by making
use of some of the existing attributes of the property. For instance, you can apply
for Development Approval that will allow a few townhouses to be built on it, and
then on-selling the property with the approval in place.
Creating cashflow through real estate is easier than most people think. There's a
lot of money to be made but it does take time. That's why time is the thing most
property developers value most. You'll be hearing a lot more about this as you
progress through this book.

OPTIONS GIVE YOU TIME

When you secure an option on a property, you are getting time, which will
allow you to add value in some way so that you can realise a price far higher than
otherwise would be the case.

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It is important to understand at this point that an option is not a contract. All it

is is an agreement that gives you time. That's all it is.
An option is a right given for a consideration to purchase a property on or
before a fixed date, on terms previously agreed upon. An option entitles, but does
not oblige, the person having the option to make the purchase. It is, needless to say,
a legal document.

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