Hi Everyone,
I hope that you are doing well.
Today’s blog post is inspired by 2 stories. One of these stories I experienced about 3 years ago. The other story I heard today. Hearing today’s story, made me think back to the story from 3 years ago. Both of these stories have something to do with the element of ‘luck’.
Here is story number one:
In 2007 I had my real estate license and I was working as a Realtor. During this time, I had come across a lady who owned a 3 bedroom 2 bathroom bungalow in an upper to middle class suburb of Toronto. She was selling her home at this time and downsizing because her husband was very ill. They needed to move somewhere where he would have better access to help and health care.
Admittedly, she knew nothing about business, investing, or how to be savvy with money. However, her net worth led me to believe that perhaps she did know a thing or two about investing, and here is why:
- She initially bought her house for $200,000
- She was selling her house for $950,000
- She had lived in her house for 20 years
- She had done absolutely no upgrades to the house at all. In fact, the house was extremely ugly inside. I still remember quite vividly the bright orange 1970s shag carpet in the bedrooms.
- Real Estate Developers were buying houses on her street for approximately $900,000 each and building multi-million dollar homes on the land
A few years after this transaction took place, I looked back to this situation and thought to myself, “Man, was that lady every lucky that he house appreciated so much.” However, in years gone by, I came to realize that there is no such thing as ‘luck’. I will explain why I believe this to be the case at the end of the post…
Here is story number two:
Today, I was having a conversation with a very smart entrepreneur. She immigrated to Canada several years ago and quickly found a home in Toronto. Like many immigrants that move to Canada, she bought real estate as soon as she was able to afford it. Over the course of a number of years, she was able to purchase 2 investment properties close by to one another. At the time, she purchased these 2 properties because the cash flow being generated from these properties was “good”. These properties were purchased in 1998. Each one was purchased for approximately $215,000.
Fast forward 12 years later and these properties are each worth approximately $625,000. Not to mention that they are both located in an area of Toronto that is undergoing incredible revitalization. This was once an area riddled with drugs, crime, and prostitution. Now it is a vibrant, upcoming area. Probably one the hottest areas in Toronto.
Man…what a ‘lucky’ lady. Her properties appreciated so much!
What’s ‘luck’ got to do with it?
There are 2 ways to interpret the above mentioned stories.
1) We can read each story and think to ourselves how ‘lucky’ these people were that they prospered in the way that they did.
or
2) We can read each story and look for the common clues that led to their individual successes.
I personally look at these 2 stories and find the common clues that led to their success. In no way, shape of form do I believe that ‘luck’ exists when it comes to business and investing.
I am a firm believer that nothing is ever ‘handed’ to you. You have to work hard for what you want.
In the 2 stories mentioned above, in my view, these are the actions that led to the success of these 2 investors:
- First, they took action and bought real estate. If they had not bought real estate some years back, I would not be writing this and you would not be reading this, as there would be nothing to write or read about. Taking action is a crucial step to becoming successful…period.
- They held their real estate long term. Many investors, when the going gets tough bail on their investments. It is easy to give up. Giving up gets you no where. Had they given up years ago and sold their real estate, they would no longer own the properties and therefore would not have benefited from the price gains.
So, how can you be lucky with money?
In my view, you can be lucky with money, when you believe that luck does not exist.
- Work hard and don’t believe in luck.
- Take action
- Buy real estate
- Hold it for the long term.
If you do this, you will be surprised how ‘lucky’ you will become!
Best Regards,
Neil Uttamsingh
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Great post Neil! I agree wholeheartedly with your 4 points. The only thing I would change is point 1: Work hard and don’t believe in luck. I would change that to say 1: Work hard and don’t RELY on luck. There’s nothing wrong with believing in luck, you just can’t rely on it.
Great stories to add to your point! Thanks for sharing.
Cheers