Ryan McLean : Slightly Unconventional

Living Your Dreams For $20/Week

One of the things Tim Ferris talks about in The 4 Hour Work Week is a dreamline. A dreamline is basically your dreams written down as goals to achieve in the next 6-12 months. A dreamline also contains the calculation on how much money per month/week/day your dream will cost.

One of my dreams is to own a Lexus Rx330, which you can buy for around $35-40k second hand (3 years old). A dreamline encourages you to look at the monthly cost instead of the overall figure. This makes things seem more achievable.

If I could borrow $35,000 to buy my Lexus I would likely have to pay 14.5% interest (on a personal loan). That works about to about $5,075/year or around $100/week. On my wage $100/week is a lot of money.

However, I believe I have found a way to achieve that dream for just $20/week. There is a property I am looking at buying in a country town. I can purchase the property for $0 down using vendor finance. The property is on a big block so I could subdivide it and sell off the block of land.

The property is negative cashflow at around $20/week. But subdividing and selling off the land will not lower the rent. So I can subdivide and sell the land, put $35-40k in my pocket and it will still only cost me $20/week. I can then take that $35-$40k I received from the sale of the land to buy my Lexus.

I then end up with a Lexus that effectively only costs me $20/week and a property that effectively costs me $0/week (because the loss is passed onto the Lexus theoretically). So instead of spending $100/week for a Lexus, by being smart I end up with a Lexus and a property for just $20/week. That makes my dreams look really affordable.

The only thing I am unsure about is whether or not you need to get your property re-valued when you sell off the land. If the banks then revalue your property lower you might be required to pay back some of your mortgage, making your profit less and the deal less lucrative. I will look into this one.

Your dream doesn’t have to be a Lexus. It could be a holiday around the world, it could be whatever you want it to be. By being smart with property you can achieve your dreams for a fraction of the cost of the traditional methods.

One of my mates asked me if I would be willing to buy a negatively cashflowed property in order to achieve that. My response was something along the lines of “As if I wouldn’t pay $20/week to live my dreams. I can afford $20/week”.

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