Q. What motivated you to begin investing in property?
I started my working life as a tradesman. I followed in my father’s footsteps. Dad worked long hours, six days a week, so I figured that’s how you get ahead – you go and you do more hours and you do more work.
One day I fell asleep behind the wheel after 20-odd hours of working, and smashed the car. After that I started looking around for a better way to get ahead.
After the car accident, I changed career and got into real estate as an agent. I learnt how to leverage property and get ahead, making my money work harder for me.
I wanted more out of life and I was looking for a solution. Coming from a conservative, English background, shares and things like that weren’t to be for me because your money can be potentially zeroed and I don’t have an appetite for that.
Property is physically there. It is bricks and mortar and I had the view that as long as you can afford to hold it, you will never loose.
Q. What was your first investment property?
I look at all property as an investment. The first property I bought was probably one of the best properties I’ve owned. I bought in South Frankston in Victoria. I paid $170,000 for the property and sold it seven years later for $443,000. It was my principal place of residence, so with no capital gains that was fairly exciting too.
Any property can make you money, but the right property can make you a lot of money
That’s probably been my best one, but that was probably more by luck rather than judgement.
All my other investments have been good in their own right. They’re ‘set and forget’ properties.
I recently sold down a few and sold my current home to go and take all that money to invest it in the new family home. I’m normally a ‘never sell’ guy, but if you’re pulling money out of property to put it into property and give yourself a better life, then I think that’s okay. I’m selling down to achieve a better life, have a better location and a bigger home.
Q. What’s the worst investment you ever bought?
My car. Every car I’ve ever bought was the worst investment I ever made!
I’ve never had a bad experience with property, but lack of action has cost me the most money. When I lived in South Frankston, I could have bought the block of land next door to me for $60,000. I was offered it, but in my head the timing wasn’t right – it was all too hard, I couldn’t be bothered and so I let it go. I think it sold for about $90,000 at auction. Then the person built two town houses on it and capitalised the block again.
So that lack of action and putting things in the ‘too hard basket’ cost me $100,000 to $150,000.
Q. So did you find it hard to take that first step?
No, because I’d made a decision that I was going to change my life and improve my life, so I’d mentally made the move already. The mechanics of it were easier because I was educating myself within the industry already by making the switch to real estate. When it became time to buy, after I’d sold hundreds of millions of dollars of property I knew what was good property and what was bad property.
Q. What is the biggest mistake you see novice investors make?
Not getting advice. The reality is you can walk up to a real estate window, pick any property and if you can hold it for 10 years you will make money. But if you have the right advice, if you buy the right property in the right area, you will make a lot more. People need to invest time before they invest their money and a lot of them don’t do this.
Any property can make you money, but the right property can make you a lot of money.
Q. What’s the most important thing for investors to remember?
Make sure you can afford it. Make sure you’ve got a risk strategy. Life’s full of unknowns, so don’t rush into it. Wait six months if you have to. It’s not a race. You need a plan and a strategy. You need to know where you’re going.
The more times you do it, the more wealth you’re going to acquire in the long term. If you rush in, make the wrong decisions, overstretch yourself, it’s going to be a bad experience and you will have in your mind that property investment doesn’t work, when in reality it does – it’s the only thing that makes real money.