If only I hadn’t been so impulsive
Many years ago I made what turned out to be a monumental mistake. I still shudder when I think about it. It was an expensive lesson. Those lessons are usually the best.
At the time I had bought my first property in London. It was a 1-bed apartment that cost me £47,500. I spent another £12,500 renovating it, so the total cost was £60,000. You may be wondering how I got a property in London for so little. It was a long time ago.
A few years later my girlfriend moved in with me. We decided we needed a big place. I found a 2-bed apartment for sale in the same building. It needed to be completely renovated — new kitchen, new bathroom, new flooring — the works.
As the renovations were going to take around 6 months, I kept the 1-bed property. I planned to sell it after the renovations on the 2-bed were complete. I was earning great money back then, so I could afford both places. Finances were a little tight though,
After we moved into the 2-bed apartment, I rented out the 1-bed for a year. Money was still a little tight, but definitely manageable.
At the time I used to visit New York every year for a few weeks. As you can imagine, that was expensive. So when the tenants left I had a choice of either finding new tenants or selling the apartment.
If I kept it, I would have had to give up the New York holiday for a year or two. I didn’t like the idea of that, although it should have been obvious that it was the best long-term decision.
Selling the apartment
I decided to sell the apartment. It sold for £155,000. I was happy. I had a nice pile of cash and used some of it to pay a chunk off my new mortgage.
I had turned £60,000 into £155,000. I was some kind of property genius.
Fast forward around 10 years. The new owner of the 1-bed apartment put it up for sale. She was Spanish and was planning to move back to Spain.
It sold for a remarkable £550,000.
If only I’d kept it and rented it out. I could have made an extra £395,000 in just 10 years. Oh, what a difference that would have made to my life.
So, not a property genius after all.
It’s not the only financial mistake I’ve made in my life. If I had my time over again I think I could easily be seriously wealthy. Those mistakes can really set you back.
But I don’t want to complain because my life has turned out just fine. I recovered from my mistakes. But those mistakes have cost me large amounts of money. But that’s life. If we want the “ups” we have to accept the “downs”.
Oh well, maybe this story will earn me £10. Then I’ll only be £394,990 down.
Every little helps.
What’s your biggest financial mistake?