This shows the power of compounding returns in action.

Because each day, you’re not just earning interest – you’re earning returns on the returns you earned the day before.

And at the start it is slow.

On day 1 you have a cent.

Day 2 … 2 cents.

Day 3 … 4 cents.

Boring … you’re not making much money at all!

But by day 25 … $167,722.

Day 26 … $335,544. It starts to get more exciting.

There is a moment in almost any investment where your emotions shift. You move from “This is boring” to “this is working”.

That’s the moment where you notice the compounding returns starting to take off. And something clicks in your brain and you start to feel different.

I call this the Compounding Click. Because that shift can really happen in a moment.

Now let’s apply that to property.

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• How to use other people's money to invest
• Cashflow vs capital growth ... what's better?
• What’s the chance I lose money through property?

Why don’t properties make a lot of money in the short term?

Let’s say you bought the average property in New Zealand in 2000 for $170,000.

That was the median sale price back in January 2000.

Here’s how much you would have made each year if the property followed the market perfectly.

See how at the start you wouldn’t have made much money through capital gains.

But as time goes on the gains get bigger. Even though there are ups and downs.

For this investor it probably took 4 years for the Compounding Click moment – that moment where the returns start to feel real.

This is because at the start your property isn’t worth as much. So if the $170k property goes up in value by 10% … that’s ‘only’ $17,000.

But once that property is worth $500,000 and it goes up in value by 10%, that’s $50,000.

Same growth rate – wildly different outcome. That’s the power of compounding.

This doesn’t just happen to property values … it happens to cashflow too

The same idea applies to your cashflow.

At the start, the rental income might barely cover your costs (especially with today’s interest rates).

But over time, rents tend to increase – and they often go up faster than your expenses.

That’s because your mortgage is usually your biggest cost. And unlike rent, it doesn’t rise over time.

So while your rental income keeps increasing with inflation, your mortgage either stays the same … or shrinks.

That gap between what you earn and what you pay grows over time.

Which is why your cashflow tends to improve.

So, if you hang in there, the investment becomes easier, not harder.

I feel like I’m getting nowhere – is that normal?

If you’re early in your investment journey and progress feels slow – that doesn’t mean you’ve made a mistake.

It’s just that you haven’t got to the Compounding Click yet – that point where everything starts accelerating.

It just means you’re at the start of the curve. And you’ve probably felt this in other parts of your life too.

Maybe you tried learning a skill like piano or guitar: it’s frustrating and slow at first, but you get much better over time. Eventually you think: “wow. I’m, getting somewhere.”

That’s the Compounding Click moment.

Perhaps you’ve been on a fitness journey. At the start the gains are slow. But at some point something clicks and you make good progress.

You might have even felt this in your career. You get your first payrise at your first job and it’s tiny.

But twenty years in, you look back and you think: “wow, my life has really changed.”

Again, you might not be able to pinpoint exactly where the Compounding Click moment happened, but at some point you started to feel different about the progress you’ve made.

Property investing works the same way. The early days feel like a grind, but if you stick with it, the long-term rewards can be huge.

When you think about the profit people who have been investing for 15, 20, 30, 40, 50 years … they've made all of this money.

It's hard at the start, but it's easy in the long term.