Speculators. Speculators. Capturing The Economic Rent. Becoming financially free faster with more confidence and certainty

Capturing The Economic Rent Becoming financially free faster with more confidence and certainty 1 Speculators “History reveals that investors who ma...
Author: Lynne Ray
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Capturing The Economic Rent Becoming financially free faster with more confidence and certainty

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Speculators “History reveals that investors who made land speculation their p have rarely y held onto their p profits... sole business enterprise

“...the cycle usually wiped them out in the end.”

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Speculators “Those who had real businesses, with real earnings and real cash flow flow, who purchased real estate with profits profits...

“...but did not speculate in it, went onto make a fortune.” Phillip J Anderson

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Value By far, the majority of the world’s richest people use real estate to underpin their wealth.

To be really successful in real estate, it’s important to understand what drives value so that you can use better tactics and strategies to rocket your wealth to new highs. 4

Knowledge To be able to do this, it’s more important to know when to buy rather than what to buy buy.

Not that I’m saying that what to buy is unimportant. But the greatest wealth is created in a certain part of an economic cycle. When you get your timing right...

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Timing ...market forces will do the heavy profit h fit lifti lifting for f you.

When you get your timing wrong, markets will evaporate value faster than you can do anything about it.

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Reach up Accelerated wealth also means you’ll need to develop new ways of creating extra e tra income streams... streams

...so that you can engage the profitable opportunities in front of you... otherwise you’ll miss the best decade of opportunity I’ve seen for a long time.

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Stage Another consideration that’s important is the stage of wealth development you’re at and the appropriate “pathway” pathway for that stage. stage

1… Money to Wealth. More money = More wealth. 2… Wealth to Money. More wealth = More money = More lifestyle.

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Now is the greatest opportunity you’ll ever have to enjoy more time, money and freedom. I’ll show you why the next decade can take you from a wage existence to a lucrative existence.

Must activate new knowledge and take new actions

97% = Status Quo

3% Lucrative Incomes

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Taking action Knowing something and g that something g are activating two different things.

Creating wealth doesn’t come easily. You have to work hard at understanding new ways of thinking and doing. You have to work at breaking old money habits and creating new ones.

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Advantage When you leverage new knowledge, you can take advantage of it for decades to come.

In the current economic conditions, you’ll need to combine passive investing with active income generation so you can make more cash flow happen. 11

Advantage If you don’t activate new learning, you’ll always remain in servitude to... to

...old conditioning, old wage economies, and huge amounts of debt. That’s why 97% of workers fail to progress past labour for wages and never become financially free.

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Biggest challenge The biggest challenge you’ll face is not being able to make more money fast enough enough...

...to take advantage of the golden decade we’re about to enter. That’s why you need new entrepreneurial skills for developing more cash flow… for more wealth.

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Property cycles This training is all about how you can read and benefit from property cycles.

It’s knowledge that central institutions don’t want you to have because it has the potential to free you from servitude to them. 14

Land value In his book, 100 Years Of Land Values In Chicago, land economist H Homer H Hoytt noted t d th that... t

...“Land values, as distinguished from real estate prices, grow almost exactly as population increases, for they are determined by the economic returns in rents when improved...

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Land value ...“while real estate prices are not determined by intrinsic values values...

...“but largely by sentiment, so that prices and values do not necessarily, in fact, rarely mean the same thing.” So what drives value?

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Economic rent For this, we need to look at David Ricardo’s Law of Rent. Ricardo was an English economist who observed that increased value was not part p of the costs of production. p

He noted that wage and material costs were pretty much the same wherever you built.

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Economic rent In addition, he noted that “selling prices” were not dependent on the costs of production nor the costs of asset acquisition.

Something else must explain differences in prices and values.

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Economic rent When you “bid more” to acquire locations of advantage, the extra money you bid doesn’t go to builders, or workers, or governments. The surplus you bid relative to other locations locations...

...goes to the owner of the land title. It’s this surplus that Ricardo called the economic rent.

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Licence owner It essentially means the increase in value, which leads to an increase in price, between one tradeable d bl iitem and d another. h

In real estate, the increase belongs to the person who owns the property rights, know as a licence, and has these rights protected by law...Torrens title system.

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Licence Licences are ‘the right to own something’ that governments allow you to own own.

Think of TV licences, alcohol licences, restaurant licences, food licences, radio licences, taxi licences, casino licences and so on.

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Licence owner The largest of all government licences is the right to own property...

...which really translates into the right to collect the economic rent. It also translates into the right to collect the “contractual rent”. 22

Law of rent The Law of Rent says that increases in the value of land, or labour, or products, or services, or knowledge are based on privilege, scarcity and/or uniqueness uniqueness.

It’s a natural enterprise process in western developed nations.

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Economic rent When you own a property title, what you really own is a licence that gives you the right to control the “economic rent” which can be p into tradeable p privileges. g capitalised

It’s the capitalisation of advantage (rent) that drives economic cycles up and down.

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Wealth of Nations Adam Smith, a pioneer in political economy and author of The Wealth Of Nations observed that...

...“Every improvement in the circumstance of society tends either directly or indirectly to raise the real rent of land, to increase the real wealth of the landlord.”

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Value advantage It’s the capitalisation of advantage in the right to own property licences, the right to capture the economic rent, and the right to ttrade d lilicences...

...that gives property its wealth creation potential. The more advantage you have, the more wealth you create.

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Causality The more that infrastructure, ideas, knowledge, uniqueness, scarcity, and service improves the value of any tradeable item, the more those items will increase the price of... of

...the economic rent of what you own.

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Airbnb What started out as two friends trying to get extra cash by renting air mattresses on their living room floor has now turned into a business valued at $US10 billion.

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Kopi Luwak Forbidden from consuming plantation coffee beans, plantation workers in colonised Indonesia picked up, cleaned and roasted the civets... beans excreted byy wild Asian palm p

...that entered the plantations to eat the ripest coffee cherries.

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Kopi Luwak In the past 10 years, kopi luwak has won the hearts and wallets of a global audience. Cups sell for $30 to $100 in New York City and London.

1 kg of roasted beans can fetch as much as $130 in Indonesia and five times more overseas.

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Kopi Luwak The ultimate civet coffee was packed in a Britannia silver and 24-carat 24 carat gold-plated gold plated bag.

It was sold at the British department store Harrods for over $10,000.

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Cars Quadrupled the economic rent of cars.

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