Investing in property is a popular way to build a big retirement nest egg. Experts can’t decide though on how many houses that you’d need to retire comfortably. The typical range is from one to four houses.
Authors Ben Kingsley and Bryce Holdaway, who wrote The Armchair Guide to Property Investing, say that roughly 75 per of real estate investors stop at just one property purchase with less than 10 per cent owning more than two.
Purchasing only one investment property won’t provide you with a passive income, but in saying that you won’t need 10-plus properties like industry insiders and investment books say that you need.
Ben and Bryce say that you only need three to five properties but that you need to choose wisely in where you invest and plan accordingly. An example they used was Kate Johnstone and Matt Moloney who were crowned Investors of the Year in 2012 for buying 16 properties. The pair is now bankrupt after their $8.5 million property empire went bust dues to property pricing plummeting in the mining town of Moranbah.
So instead of thinking about the number of properties, people should focus on the combined value and income of their properties.