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Rather than richer, it seems the rich are getting poorer according to the recently released BRW Rich 200 list. The fact is that more than half saw a drop in their wealth over the past 12 months, even though they are far from poor.

BY MICHAEL YARDNEY

This year, Gina Rinehart was the richest person in Australia and became the richest woman in the world. The 58-year-old mining magnate’s wealth has ballooned by $18.87 billion in the past year to a grand total of $29.17 billion. That equates to more than $1 million for every half an hour and almost $52 million a day.

In fact, Rinehart’s wealth is almost equal to the combined wealth of the bottom half of the list.

What can we learn from Australia’s wealthy individuals? Firstly, despite all the attention the mining billionaires have received, property still remains the single biggest source of wealth with 55 real estate entrepreneurs in the top 200 list. Many of those who didn’t make their fortunes in property have stored their wealth by investing in property.

This should come as no surprise – looking back over the years, no matter how the Australian economy changes, the Rich 200 list has always been dominated by property entrepreneurs.

Remember, there’s nothing wrong with seeing what other successful people do and applying those principles to your own life. If so many extraordinarily wealthy people have used real estate profitably, it stands to reason that there’s money to be made in this sector.

I learned some other lessons by reading the various entrepreneurs’ stories:

Anyone can become rich in Australia

While 29 inherited some of their fortune, most on the Rich List were self-made successes, with some coming from working class backgrounds. Attending a private school and getting an elite education is clearly not a prerequisite to joining Australia’s wealthy. While some forged important networks at school, many went to public schools and others didn’t even finish high school. Less than half have tertiary qualifications. And, of course, the richest person in Australia is a woman. This year there are 15 other women in the Rich 200 list.

Markets move in cycles

The stockmarket is down, commercial property markets are down and high-end residential property values have fallen. This caused the average wealth of those in the list (other than Rienhardt) to fall 8.6 per cent. However in the past many successful investors took advantage of the opportunities to buy assets when they were on special. It will be interesting to see the results next year and how these counter cyclical investors fare. Warren Buffet’s famous quote sums up my feelings: “Be fearful when others are greedy, and be greedy when others are fearful.”

Make your millions and then reinvest it – don’t spend it

This is really just using the power of compounding to grow your asset base before you start spending up big. Take risks early on, but not once you are established. While many entrepreneurs took big risks to get their enterprises going, successful investors then preserved their wealth by cautiously investing rather than taking further risks.

Have one good idea and repeat it

One core trait that successful entrepreneurs share is the ability to take a good idea and repeat it over and over again. Look through the list and you’ll see so many entrepreneurs stick to the same concept and just expand in different locations.

Pick the trends

This is different to picking fads, which are transient. Go for growth. Sure, cash flow is important but to become really rich you need a large asset base. While the average Australian tries to increase their cash flow, the wealthy are obsessed with building their asset base.

Surround yourself with a good team

As I’ve often said, if you’re the smartest person in your team you are in trouble.

Take action

All the people who made it onto this year’s Rich 200 list started with a dream and then took action. You’re never too young and you’re never too old. The youngest member of the list is aged 36 and has an estimated wealth of $915 million, which is even more than the oldest member who at the age of 92 has accumulated $360 million.

And if all else fails, try digging some dirt. You may find some valuable minerals.

What have you learned from Australia’s richest people? What can you do differently to become a successful property investor and get ahead of the pack?

Michael Yardney is the director of Metropole Property Investment Strategists, which creates wealth for its clients through independent, unbiased property advice and advocacy. He is a best-selling author, one of Australia’s leading experts in wealth creation through property and writes the Property Investment Update blog.