Once you have kept your list for a couple of weeks, you already start to make some fascinating discoveries. It was not big amounts on my list that had to be dealt with, as I had imagined. These were essential things, which there was no way I could do without. However, small sums on my list were doing damage! I was buying something to eat every morning before going into office, but I was totally unaware of what it was costing me. I was spending 2.75 GBP every morning and that was adding up to around 55 GBP per month! As soon as I realised this, I started making my own breakfast. In addition to spotting things like this, I could turn to my list at any point during month and see how much money I had left until next pay day. This way, there was never any danger that I would have to go into overdraft on my bank account.

This in itself represented a real saving that I started making each month and once I did away with one or two other unnecessary expenses, I was making very significant savings, which I then put towards paying off my mortgage debt. Keeping a list of this type is a simple yet powerful tool because it will clearly and simply show you where your money is going, and give you control to make some changes.

Cases 2 and 3 require a bit of explanation. There are some early stage land projects available where developer will take a percentage of your purchase price and escrow an amount that will make your payments for a period of time---- typically 2 years. This means that during your 2 year hold, you would only pay taxes and association fees. To enter this in spreadsheet, we just show a 0% rate during holding period.

If you scroll down, you can review performance of each case. It may surprise you that even under Case 1, where you paid in a total of $48,600 out of pocket, you still see a return on investment of 127%! That equates to 51% annual return on investment. Compare that to what your friendly banker is giving you in your CD.

For many investors, beginning or not, they would prefer not to have to put in that much money so let’s look at Case 2 where developer has escrowed 2 years worth of payments. In this case, we invest a total of $29,000 with a total, out door profit before taxes of $81,625 thus providing a total return of 281%. If you then extend that to Case 3, where only 5% down is required, then return goes off charts.

The biggest variable here is our assumed appreciation rate: we choose 25%. Of course this depends on general market, local market, project, etc. and NOBODY can predict this going forward. So what happens as assumed level goes from -5%/Yr to 50%/Yr which hopefully will be a good bracket. The chart below shows results. (See Chart In Article Here)

In very near future, there will be some opportunities on “preconstruction” land similar to what is described here. If this type of investment may be of interest to you, then your job becomes deciding these 3 factors: •Is it low risk for YOU? •Is it good investment returns for YOU?; •Is it an acceptable use of YOUR capital; To assist, we will try to present enough information about project/locale to for you to assess your own risk and projected growth rates: what you assume may be quite different from what I assume and that is ok.