Renovating realities: Q&A with Cherie Barber

In 1991 I was 21 and I saved up my deposit by working a second job. I bought my first property with my boyfriend at the time, so we saved up a deposit together.

Looking back now, it was the wrong property to buy. It was a little un-renovated house on a main road, a major artery – Ryde Road, Pymble. I bought it with the intention that it would be my principle place of residence, but after about two months the traffic noise was too much.

So I did a quick cosmetic renovation, just a spruce up. I spent about $10,000. I painted the walls, I ripped up the carpets and I updated the kitchen and bathroom a little bit – just tidied them up. I took off the old daggy curtains and put some new curtains in. They were really basic renovation changes. It definitely wasn’t a whole house transformation.

I sold the property as soon as I finished it and after my costs I made a $40,000 profit.
So I fell into renovating by accident.

Q. How did you build your portfolio?

Straight after that first property purchase, I went and bought another property – a principle place of residence again.

It was on a quieter street and was un-renovated. I lived in that property for the next six years or so and renovated it in the evenings and on weekends while I was working my full-time marketing job. It was a structural renovation.

I sold that property about six or seven years later and after I split the costs with my boyfriend, I walked away with about $120,000 in profit.

By the time I was 30, I had a little more money behind me and I was sick of my corporate job.

So in 2000, I bought an un-renovated house in Rozelle for $537,000. I held down my full-time job and then I went to the site each evening to make sure the tradies were doing what they were supposed to be doing. I worked on the site at the weekends. It was a structural renovation, so I was more like a site cleaner because I had no trade qualifications.

It was an eight-week renovation all up. I took that property to auction immediately after completion, and I sold the property for $955,000. I walked away with $268,000 net profit margin after all my costs.

I thought ‘What am I doing? I just made two years’ salary in the space of eight weeks part time’. That’s when it dawned on me that there’s a smarter way to earn a living and a more enjoyable way. I loved the process and I made fantastic money.

I quit my job after that and I’ve been renovating full time ever since.

Q. How many properties have you renovated now?
I’m on project number 45 as we speak.

Q. Do you sell all the properties you buy and renovate, or do you hold onto some of them?

I try and hold onto them. It just depends what type of property it is. I’ve held onto quite a few. I’ve also sold some just to free up cash flow. Sometimes you can get a bit highly leveraged and it’s better to sell one. I only sell if I need to.

Q. What was the best investment advice you ever received?

I haven’t actually received a lot of advice from other people. I’ve mainly been self-taught and learnt through my experiences. I learned the hard way.

I’ve always made a profit on my projects but I’ve lost hundreds of thousands in potential earnings. I could have made hundreds of thousands more if I’d known what I know now about managing tradies, buying fixtures and fittings, where to spend money, where not to spend money, what adds real value, what doesn’t and the art and science of renovating.

The one piece of advice that I do value came from Michal Grant of Cornerstone. He said: “When you’re trying to negotiate, don’t impose your conditions on a vendor. Try and find out what they really want and then try and match your offer as closely as possible to their needs.”

I’m very conscious of that when I negotiate these days because it just means you’re trying to get closer to what somebody wants rather than saying to them ‘I need this this, this and this’. Find out what they need and whether you can deliver that. If you can do that, you’ve got a much better chance of actually securing the property on terms that work for you and also the vendor.