Why it's important to diversify into different markets
Development

Why it's important to diversify into different markets

By Demii Kalavritinos
Eddie Dilleen, Investor

Everyone has a dream, and for this young property investor his dream hasn’t changed since his last visit in the studio. Full-time property investor Eddie Dilleen joins interim host and real estate editor Tim Neary and reveals how he managed to smash his goal of owning 10 properties, and is about to settle on his 12th.

Eddie discusses how owning a Mustang is still on the cards, why he branched out into different markets around Australia instead of sticking to his backyard, how his passion for property has come through in his new profession and how his 'addiction' for property has brought excitement in his life.

You will also hear about the unexpected setbacks he faced along the way, what people should really know about property and his view on mortgage brokers and the Big Banks!

You'll hear all of this and much, much more in this episode of The Smart Property Investment Show!

 

If you like this episode, show your support by rating us or leaving a review on iTunes (The Smart Property Investment Show) and by following Smart Property Investment on social media: Facebook, Twitter and LinkedIn.

If you have any questions about what you heard today, any topics of interest you have in mind, or if you’d like to lend your voice to the show, email [email protected] for more insights!

SUBURBS MENTIONED IN THIS EPISODE:

Adelaide
Sydney
Broadbeach
Southport
Surfers Paradise
Brisbane

 

RELATED AREAS OF INTEREST:
How travelling cross-country helped this investor buy 9 properties in 6 years
How to choose the right real estate agent
Selling property is one of life’s most stressful tasks, survey reveals
An easy three-point checklist for finding good properties

 

Announcer:    Welcome to The Smart Property Investment Show with your host Phil Tarrant.

Tim Neary:    How is it everybody, it's Tim Neary here I'm editor of sister publication actually to Smart Property Investment, Real Estate Business, and will be hosting the Smart Property Investment Show today in place of regular host, Phil Tarrant, who is away at the moment. It's big shoes to fill, actually. Joining me on the show today is Eddie Dilleen. Eddie was on the show just over a year ago. A very impressive young man who's been in the business a little while, and at the time had eight properties in his portfolio and was just 25 years of age. Hello Eddie, and welcome to the show again.

Eddie Dilleen:            Hi, Tim. Thanks for having me. Excited to be here.

Tim Neary:    You're welcome. Now, I'd like to kick off with a very important question, and it's based I guess on a goal that you mentioned the last time that you were here, and the question is, what car are you driving?

Eddie Dilleen:            It's unfortunately not a Mustang, as I said before. It's a Mazda6 at the moment. I had to put the Mustang on hold to purchase another few more properties.

Tim Neary:    That's probably a good plan. That's probably a good plan. Now, just the backstory there was ... Eddie had been invited on a few shows, and there were a couple of things prior to coming on Smart Property the last time, and there were a couple of haters who were saying something along the lines of, "Nice houses, but what about the car?" There was the Holden Astra-

Eddie Dilleen:            That's right.

Tim Neary:    ... at the time, and Eddie said then, "Well, when I get to 10, then I'm going to buy the dream car of the Mustang." So I guess that's still the dream and it's still coming.

Eddie Dilleen:            It is. It is. It's one of those things once you get to a few places where you want to get to, you extend the bar a little bit more and you keep going.

Tim Neary:    Nice work. That's a pretty good segue into today's discussions. What's does a portfolio look like today? You had eight at the time then, and you were aiming for 10. Did you get there?

Eddie Dilleen:            I did. I did. I got there finally. Wasn't the easiest thing to do, but I finally got there. I'm in the middle of settling on number 12 at the moment, so I was able to get there, but I didn't want to stop once I got at 10, I wanted to keep on going and maybe get a few more onto my belt, and then get the car.

Tim Neary:    Tell us a little bit about those properties. Now, for the first eight, you had pretty much bought them away from where you live. Has that still been the case? Is that still the trend?

Eddie Dilleen:            Yeah, most definitely. Like I think for me, when I was growing up and everything, right before some of the major markets started to take off, I was 17, 16, 17 at the time, then I purchased the first one after I was 18 in the Central Coast. But then after that, I didn't quite have the amount of capital there after that to go ahead and purchase in the big city. So I kind of started buying small properties, still within metro cities around Queensland, Adelaide. And yeah, I'd just stick with the fundamentals, buying small, buying smart, with high rental yields as well.

Tim Neary:    Because that's been your game plan from the start, hasn't it, is to find a well-priced, modest priced properties undervalued with a high potential for rental income.

Eddie Dilleen:            Absolutely.

Tim Neary:    Yeah.

Eddie Dilleen:            Absolutely. That is the key. I don't purchase out in the middle of mining towns or really far away from cities. The bulk of my properties are still throughout Queensland within 25 minutes' drive to Brisbane, some in the heart of Gold Coast, and about three more through only about 20 minutes' drive from Adelaide CBD. And then of course we got Central Coast only about an hour away from Sydney, an hour roughly.

Tim Neary:    That's sort of the 25-minute rule from the CBD. What's the thinking behind that?

Eddie Dilleen:            For me, I just knew overall if we look at cities from a geographical perspective and just overall land mass and like the population, majority of people in the population is skewed towards the big cities, like we've got millions people here in Sydney, out of about four million plus people that are in Queensland. More than three million of them are located throughout that South East Queensland region. So in terms of population growth, nature's going to take its place, and people are going to keep on populating. So yeah, it's just basic math for me.

Tim Neary:    It just gives you that piece of mind that your property's not going to stand empty, that there's always be a demand for a tenant.

Eddie Dilleen:            Absolutely.

Tim Neary:    Because that's the basic principle of the investment, isn't it, to keep the holding costs low so you don't want it to stand empty.

Eddie Dilleen:            Most definitely.

Tim Neary:    Yeah.

Eddie Dilleen:            Most definitely. I'd be surprised, like a lot of the people that I talk to, they're scared of buying interstate. They're scared of buying further away from where they live. They only want to buy around the suburbs and that kind of stuff where they're at. But it definitely limits your growth perspectives, your opportunities. If you look at all the big investors that do have sizeable portfolios, they do diversify into different markets and don't just limit themselves. Because when you do limit yourself to just certain areas and where you're comfortable at, you get stuck with finance, low rental yields, and the rest of it.

Tim Neary:    Yeah, and that's a great point. I came across this saying some time ago, and I've sort of put it at the front of things that I do, and it makes a lot of sense. It goes along something the lines of, "Start where you are, use what you have, do what you can." So to tie it into what you're saying now, if you have that X amount of deposit, X amount of finance available, that's what you've got. So that's where you start, and then you go out and find what you can, looking for the things that you're looking for, which is the high yield and the underpriced properties.

Eddie Dilleen:            Most definitely.

Tim Neary:    Talk us through the properties that you bought. Where have you bought, and for how much, and what are the yields there?

Eddie Dilleen:            Yeah. A few of the properties that I bought have been mainly around the Gold Coast. We're talking places like heart of the Gold Coast, Surfers Paradise, Southport, Broadbeach, you know, those types of areas, where there's a lot of obviously rental demand there. One of them was a one-bedroom unit, and I picked that up for $185,000.

            Obviously it's none of the resort-style holiday let kind of thing that can sometimes, people like, if they do look in those areas themselves, they get excited about, they see the resort-style ones for really, really cheap, but not knowing that majority of the times they are not proper residential, they're company titled or unit titled, so that changes for finance. All the ones that I purchase are proper residential, so they're in smaller unit blocks of six, 10 units in a block. They don't have those restrictions for finance.

Tim Neary:    That's a good point that you make as well, because I think in the first podcast, you talked a lot about doing the research and understanding what you're getting into. This is a good example of it, is that not get caught up in something else, but just stay to the fundamentals, and know what you're doing.

Eddie Dilleen:            Mm (affirmative), absolutely.

Tim Neary:    Yeah. Did you buy all four of them up there on the Gold Coast?

Eddie Dilleen:            I bought two on the Gold Coast. Another-

Tim Neary:    All in that price bracket?

Eddie Dilleen:            Yeah. Some were around 185, another one was just over 200,000. And then I bought another two in Brisbane as well.

Tim Neary:    Okay. And then the same price bracket with the same yield?

Eddie Dilleen:            Yeah, pretty much. Like the ones in Brisbane, I bought a town house in Brisbane for $160,000. That rented out for around $280 a week, so it was a massive rental return, about 9%. That's still only about 25 to 30 minute drive from the heart of Brisbane. First glance, they're not the most prettiest looking properties, but it comes down to the fundamentals of will they have a tenant there? Yes. Are we buying it below market value and making money on the way in, not just hoping and praying that it's going to go up in value? Which is a lot of people do, and that's why most people as you probably know, they only get stuck at like two or three properties maximum. Ensuring they're bought under what they're worth is the key, for sure.

Tim Neary:    Is the key. Yeah, I mean, this is an investment, it's not a gamble, so we're not hoping, we're not playing on hope. We're not betting.

Eddie Dilleen:            That's right.

Tim Neary:    This is stuff that you can rely on to a certain extent. Yep, yep.

Eddie Dilleen:            For sure.

Tim Neary:    I wanted to talk a little bit, Eddie, about your existing portfolio, the eight that you had when you were on here a year ago. I think at the time you said that overall the rental yield you were getting was about 8% plus, and the combined LVRs across the portfolio was around about 65 to 70%.

Eddie Dilleen:            Yeah.

Tim Neary:    Is that still the case?

Eddie Dilleen:            It is.

Tim Neary:    How has that changed?

Eddie Dilleen:            Yeah, like for myself, a lot of people will, sometimes in general, obviously a lot of people will borrow a lot of money against existing mortgages, and use that continue to keep growing after they've hit a certain point. Over the last year, I think just as we were on the actual podcast, I was speaking to Phil when I had a job at the time which was full-time. I was hustling to get more deposits and try to save more money manually.

Tim Neary:    I think you said at the time also you were working a second job on the weekends as well.

Eddie Dilleen:            Correct.

Tim Neary:    Yeah, so you were selling tools and working on the bar, if I remember correctly.

Eddie Dilleen:            Correct. That's right. At one stage, I had three jobs. I was working at two different bars, and working the full-time job, just to hustle and save those deposits. I was working like a madman. But it was for a reason. I don't do that anymore. So that essentially saved me from using a lot of equity upfront, which I did use some equity here and there to expand and grow, but I did save a few genuine deposits recently as well. So I think it's a balance, and overall my LVR is still roughly the same. It's just sitting under about 70%, because some of the properties I had grow, like I even had my first one, I got that revalued and that's went up another 60, 70,000. A few of the other ones I purchased, there's 30 here, 40 there, 50 there. When you've got eight of them, it makes an incredible difference.

Tim Neary:    They start to go up. You say 60, 70,000, but that's all for purchase price, around about 170, 150, 170. So those are significant increases in value.

Eddie Dilleen:            Yeah. Like the first one, for example, I bought for 138,000, and today you would be looking easily almost 350, something like that, for all the two-bedroom units around the Wyong kind of area. Yeah, and then along with the other ones around Queensland, they haven't grown quite as much, but obviously they're a lot newer, I haven't held them on for that long. And of course that's the name of the game, is more properties you hold for a lengthy period of time, the better your outcome's going to be.

Tim Neary:    So timing the market.

Eddie Dilleen:            Exactly. Regardless, right now, if I stop buying right now and I just turned 26 a few months ago, within 20 years, they're all going to be paid off anyway. So even if they don't, worst-case scenario, they're going to be paid off anyway.

Tim Neary:    Yeah, yeah. And I want to get to that a little later on in the show as well, in terms of what your plans are for them long-term, but as a broad stroke, it's to hold on to them for the long-term?

Eddie Dilleen:            Yes.

Tim Neary:    I know that things change and there's little adaptions that you've got to make along the way, but broad strokes, to hold on to them for the long-term.

Eddie Dilleen:            Yeah, definitely.

Tim Neary:    You mentioned that you are no longer working all of those jobs. Do you still have the one job, the one single job, or are you a full-time property investor these days?

Eddie Dilleen:            Yeah, I don't have any of the jobs anymore. I solely pretty much just work on property investing. After I did a few more interviews last year, towards the end of last year, I purchased a few more properties, hit that 10 properties, was lucky enough to go on TV and do a few things in the media as well because they caught a wind of that, which is cool. But then obviously I had a lot of people talking to me and wanting to find out more and how they could purchase property as well. And then eventually we just started helping people for free, talking to them over the phone, but eventually it just became too much, so then I pretty much just started my own property investment buyers agency, to help other people too.

Tim Neary:    Okay, cool. So that's putting something back into the market, and using that expertise that you've gained over the years.

Eddie Dilleen:            Exactly.

Tim Neary:    You made the point, didn't you, that when you started out, you spent a lot of time doing your research and understanding not just the fundamentals of property, but all of the things that go with that, the finance and the management of the portfolio as well.

Eddie Dilleen:            Exact-

Tim Neary:    So you would've learned a lot along the way.

Eddie Dilleen:            Absolutely. Like I think in general, for anyone that purchases five, 10, 11 properties, or however many, you learn things along the way. Finance is obviously one of the biggest things, I didn't mention that last time. To realise how finance works, you have to kind of think like, you have to know how a broker works, what their processes are in place, you have to study all these things, and kind of become a master at all trades in terms of how to structure your portfolio, when not to cross-collateralize, what types of properties to purchase, when you're going to have to focus on high yields and when you can relax a little bit. There's a lot of different facets to it, so for sure.

Tim Neary:    It's really impressive as well, you know, because I remember you making the point that you wanted to give yourself options, so you were prepared to do the hard work early to get to the point later on where you were doing something that you wanted to do, rather than what you needed to do. Your passion for property came through. I think you used the word, you were addicted to it. So it's really terrific to hear you today saying that that's what you do. That's what you're doing full-time, and you're taking that passion and you're taking that addiction, if you like, and you're putting it into something that really you understand and really switches you on, ticks all your boxes.

Eddie Dilleen:            Yeah, it certainly does. It's something I get excited for when I'm waking up in the morning now, rather than dreading when I always had to go into work for someone else and worrying what they were going to say if I was late five, 10 minutes or, you know, take a too long a lunch break or something like that, you know, sometimes dreading to ... It's not that everyone's workplace is like that, but you know-

Tim Neary:    It can get like that.

Eddie Dilleen:            Yeah.

Tim Neary:    It can get like that. And on the other side of the coin, when you're doing something like what you're doing now, you never really work a day in your life, do you, when you do something you love?

Eddie Dilleen:            That's right. I always thought that once I hit eight, 10, 11 properties and I had more passive income, as I pushed up the rents and negotiated on loans, I've created more of a stream for myself, which equates to a small wage. I always thought that once I would do that, I just wouldn't do anything, I'd just sit on my backside and watch TV all day, but unfortunately once you get hooked, you get hooked, and you just can't stop, and my brain just doesn't stop. It just keeps going. I live for property. I'm always on RealEstate.com or whatever search engine and talking to agents, talking to property managers in the market.

Tim Neary:    I'm not surprised to hear that, you know. At 25, when you were 25 and having eight properties under your belt already by then, it didn't seem like you were the kind of guy that was just going to go slow after that, it seemed likely that it was going to kick on. So that's great news, and it's really good to hear that. Any setbacks along the way? Any things in the portfolio that were unexpected, losing tenants unexpectedly, or any stuff like that? Any of the, and I'm thinking more just in terms of I guess starting out investors, some of the things that they might encounter, and how to deal with them.

Eddie Dilleen:            Yeah, definitely. I had a year basically where I had about three or four properties out of the properties I own, a couple water heaters broke down. One needed an air conditioner put in. I think there was a bit of damage in one of the other ones, you know, someone put a few holes in the wall. So yeah, things do come up, and it does affect your cash flow. And more importantly than ever, that's why you have to cash flow your properties and make sure the yields are really high. But yeah, sometimes there were trying times, but you've got to think big picture.

            I see a lot of investors, when they go to invest in property, they focus on $200 there, $500 here, a thousand dollars there, but they're not, and it sometimes stops them from actually purchasing a property. But then most likely within 20 years, they're going to look back and wish they did purchase that property because over time, $200 here, $500 there, the property's most likely going to double within 10 to 20 years regardless. So just to save a few bucks upfront can actually cost you a lot of money in the future.

Tim Neary:    And they're going to have forgotten about those incidentals, $200, a thousand dollars here and there when they see the big values that those properties are generating in terms of value then.

Eddie Dilleen:            Most definitely. I feel that strength, it comes in numbers. So the more obviously properties that you have that are structured correctly, the more the results magnify over time. So fewer properties here, if you've got say two properties for example and both of them go empty for a week or whatever for some reason, but of course bear in mind you have insurance for landlord insurance in case it does happen, but if it did happen, that would be your whole portfolio. If you had six or seven or eight, then that's only a small amount and your cash flow would subsidise-

Tim Neary:    Carry it through.

Eddie Dilleen:            Yeah.

Tim Neary:    And you talk about that, don't you, talk about the balance of that.

Eddie Dilleen:            Absolutely.

Tim Neary:    Balancing your portfolio. Now, I know that we touched on this earlier and it's terrific that you are now full-time in the business, because it gives you I guess a better place to give advice to others as we go forward. I wanted to just tap into your brain for a second, around starting out property advisors, property investors, or even those that have been in the business a while that maybe just need a bit of a refresher or interested in another point of view. What are some of the things that people should know about let's start with the fundamentals of property? What should people know about property? How does it work?

Eddie Dilleen:            I think some of the things that I look for really in depth, and I guess it also is classified as being fundamental and basic, but I see a lot of people, they want to only purchase for example houses because they obviously learned from their parents and that kind of thing that you purchase a house, has land on it, then furnish that land, and that kind of thing. However, looking at my portfolio, it has a mixture of some houses, some town houses, some units, and that kind of thing as well. When you do only focus on houses, yes, you're obviously purchasing a lot of land which is a good thing, but the rental yields on most houses throughout metro places like Queensland, Sydney, Melbourne, Adelaide, that kind of stuff, the yields aren't quite there.

            Say if for example you're getting a house and it has a 4, 5% yield, it's not too bad, but it's not going to win you any awards. It's not going to put money in your pocket or even service itself after the council rates and water rates and management fees and et cetera, you'll still be losing money. You'll be trying to claim a little bit of it back, which is good for reducing your tax, but when you go on to two, three, four, you're going to get stuck with finance 90% of the time. It's definitely having that balance I think, and most people just only skew towards houses, whereas if you start small and buy a house, buy a town house, buy a unit, buy a house, then you can effectively grow your portfolio and not shoot yourself in the foot.

Tim Neary:    And I'm hearing you say also think about the future, think about where you want to go with it, and don't paint yourself into a corner.

Eddie Dilleen:            Absolutely. I had a trick which I used to do when I was up to around four, five properties, and I starting realising how banks work and how they service people and how banks have different calculators and serviceability and checkpoints and that kind of stuff. I would only basically purchase a property if in fact that I would know for a fact I'd be able to finance another property after it. So if I was going to buy a property for 200,000, and it rented out for $300 a week or $320 a week, say in the Gold Coast for example, I would go to another lender or go to the broker who I was using or the bank manager I was using, and say, "Factor in these numbers, what this property I'm about to purchase, and what's my borrowing capacity going to roughly be afterwards?"

Tim Neary:    Just so that you would take those precautions so that you didn't dead end yourself.

Eddie Dilleen:            Yeah, exactly. I've spoke to a few people, and they've got two houses, they're going to buy another house in Melbourne, for example, 4% yields, 5% yields, something like that. They do it, and then afterwards they can't borrow any money from the bank because they're all too negative.

Tim Neary:    And they're stuck, yeah. You mentioned also that you were dealing with, I think you said two of the big four banks. Is that still the case, and less with brokers, or have you expanded that a little bit, or you're dealing with brokers? What's your view on mortgage brokers?

Eddie Dilleen:            Mainly it's still the big banks. Mainly still the big banks, but I have acquired some good mortgage brokers along the way to get the last few properties. Two of the recent properties I've purchased have been through brokers. Pretty much all of the other ones was just directly through the bank, mainly. I've also started purchasing a property through a self-managed super fund, which is a whole nother department, as I'm sure you're aware. It's amazing for me to hear, and when I talk to people, they have no idea about and they say, "Oh, I thought you could only purchase if you had over 150 or 200k or 300,000 in your super." And I go, "Well, I'm doing it." There's ways around things. There's a lot of miscommunicated information out there from people that as a matter of fact sometimes don't have any property at all. So you've got to pick…

Tim Neary:    People make assumptions, and then they set themselves up as experts.

Eddie Dilleen:            Exactly.

Tim Neary:    Yeah.

Eddie Dilleen:            Exactly.

Tim Neary:    Yeah. So you've got to watch out for that, and speak to the experts. We're speaking to one today.

Eddie Dilleen:            That's right.

Tim Neary:    Now, self-managed super fund, and your portfolio is growing. What is your advice around putting together a professional team?

Eddie Dilleen:            Look, most definitely when I was getting started buying my first few properties, I was obviously reading a lot of books and that kind of stuff, but I didn't have anyone there who I could turn to, like no one in my family ever owned an investment property, or any of my friends, and that kind of stuff. So I kind of had to just learn by trial and error. But nowadays obviously you've got a lot of people who do have more experiences, so number one obviously, talk to someone who has done it before. Shoot them a message, they may be available to talk to you, depending if they're not busy or not. But yeah. Obviously get help from someone who's done it before, someone who has properties that you aim to do. There are a lot of companies out there where sometimes people that run the company, they only got one property, but they say buy six, so you've got to take that as a grain of salt, and make sure you do your research.

Tim Neary:    Because they just wouldn't have the experience, would they, in terms of the kind of things that can go wrong or right when you're managing multiple properties.

Eddie Dilleen:            Yeah, exactly. So obviously if you're looking to build a portfolio, help fund your retirement or create wealth in the long-term and get yourself in a better position, obviously seek out someone who's done it before. So that'll be number one.

            Number two would obviously be read as many books as you can, for sure. You've got to also do your own research, property investment books and educate yourself on that. Whoever you use for a broker, obviously they have to be efficient in helping structure a large portfolio. A lot of people, I've got a few people that I've spoke to who they purchase with friends, and they purchase with family members, and they go back to purchase in their own name, and they cannot get finance. So that is a huge thing, the way ... That comes back to learning about finance, how banks look at a person's debt when they purchase it with someone else's name or with a family or friend or in joint names, in structuring your portfolio, basically. So learning about how you should purchase each property. I would've got stuck very quickly if I started buying with my brother or someone else or sister or family member, and then try to purchase in my own name for the finance reasons.

Tim Neary:    That would've meant that you wouldn't have got to the 12 that you've got to today.

Eddie Dilleen:            Exactly.

Tim Neary:    Does that revolve around, and I don't want this to become a finance podcast, but does it revolve around equity and the loan-to-value ratio?

Eddie Dilleen:            A little bit. A lot to do with servicing. Some banks only will take in a portion of, so say if you've got, this is from my experience, and obviously I'm not a financial advisor, but this is from my experience and dealing with people who have done it before and they have got themselves stuck. If they purchase for example in joint names, you're looking to purchase with your partner or your sister for example, and then you go back to purchase in your individual name, the bank will usually assess that first property as you own the debt a hundred percent, even though you are splitting it with your partner. They will consider the debt a hundred percent in your name, even though you're only responsible for 50% of it. Take it with a grain of salt, do your research regardless.

            Also, when it comes to rental income for that property, so say if it's 400,000 and it's 400 bucks a week rent, and they're only going to assess usually half the rent.

Tim Neary:    So they're going to be as conservative as they can-

Eddie Dilleen:            Exactly.

Tim Neary:    ... in terms of making their serviceability calculations, I guess.

Eddie Dilleen:            Absolutely.

Tim Neary:    Yeah.

Eddie Dilleen:            Absolutely. One wrong move in terms of buying one property, and you're done for. You're going to either have to sell the property off, restructure it. If you do do that, you can sometimes incur a stamp duty cost if you do transfer it to someone else's name, so structuring is a huge thing, along with finance, along with finally finding the property.

Tim Neary:    So you're losing in the short-term because it's costing you money, and you're losing in the long-term because you no longer hold it, and it's not accruing value for you in the long-term-

Eddie Dilleen:            Yeah, most definitely.

Tim Neary:    ... by making a mistake early.

Eddie Dilleen:            Yeah, just by-

Tim Neary:    So yeah, a finance-related mistake, yeah.

Eddie Dilleen:            Yeah, exactly, just by structuring it the wrong way.

Tim Neary:    Mate, it's been a real pleasure to have you back in the studio. Again, congratulations. I've still got my eye on that Mustang for you. I'm looking, the next time you're in, we're going to ask you about the Mustang. No pressure, but we're going to ask you about that. Congratulations on the new role with the buyers agency.

Eddie Dilleen:            Thank you very much.

Tim Neary:    All the best for that as well. And on the 12th. I've got one last question for you, and that's really, what is your plan going forward? And also, the big picture. How do you see the property investment market developing this year and beyond?

Eddie Dilleen:            Yeah, look, plan for me is definitely, I don't plan to stop buying any time soon. I plan to hit 20 properties, is the next one I want to hit. I haven't exactly put a time frame on it, but I'm obviously going to push as hard as I can to get there.

Tim Neary:    Have you still got some borrowing capacity to move into?

Eddie Dilleen:            A little bit, but it's something I'm going to have to work towards. Certain things I've done recently to cash flow my portfolio has been to negotiate some specifics, a decent amount of properties, so say for example save 10, 15,000 here in interest. Also, when you have a portfolio, say if you increase the rents by $30 each and you got 10, 11 of them, it positives another 15,000, so you're switching around $30,000 worth of cash flow.

Tim Neary:    Gives you some leverage when you've got some volume.

Eddie Dilleen:            Options as well.

Tim Neary:    Yeah. Options. Options.

Eddie Dilleen:            Definitely. But yeah, for sure. For the market moving forward, I definitely see that this year, 2018, obviously you've got Sydney and Melbourne, the two leaders that are if you've been watching the media, hearing that they're slowing a fair bit for. Sydney and Melbourne obviously, I see that it's going to continue to plateau. It might some 5, 10% fluctuations I think overall, but I still lean towards, I classify that as overall flat, up down 10 down, up down 10 down. I don't see any crash coming or anything like that. It's a supply and demand game. For the market which I'm mainly buying in, is obviously Queensland and South East Queensland, I feel that there's more opportunities there than ever with the lower priced properties still within half an hour. There is amazing buys out there. High rental yields that aren't going to get you stuck with finance. I definitely, Queensland's still my number one.

Tim Neary:    Still a massive opportunity up there.

Eddie Dilleen:            Absolutely.

Tim Neary:    Yeah.

Eddie Dilleen:            I've got a couple in Adelaide as well. Adelaide's, it's just kind of the story of the tortoise, it just keeps on going and ticking along, and long-term growth from the past has been great, and high rental yields as well. Other markets like that, I don't really look too much in Perth obviously, a little bit on the decline and that kind of thing. Tasmania, you know, has seen a lot of publicity lately.

Tim Neary:    Hobart's getting a bit of a word, isn't it, just lately?

Eddie Dilleen:            Exactly. Yeah, exactly. It's something that to potentially look more into, but I wouldn't put all my eggs in one basket. Definitely diversify, think outside the box, and don't limit yourself to just where you live.

Tim Neary:    Cool. Eddie, it's been a real pleasure. Thanks for coming in.

Eddie Dilleen:            I appreciate that, Tim. Thank you very much.

Tim Neary:    Nice one.

Eddie Dilleen:            I appreciate that.

Tim Neary:    Nice one, mate.

            Remember to follow us all on the social media stuff, Twitter, Facebook, LinkedIn. You can follow Phil also on Twitter, @philtarrant, if you want to do that. If you've enjoyed today's show, leave us a five-star rating review on iTunes. It's the best way for new listeners to find us, and for them to hear the great content that we are putting out. As always, smartpropertyinvestment.com.au is where you'll find us. There's plenty of stories on the business of property investment across Australia there, and on my guest today, Eddie Dilleen. Thanks again for tuning in. We'll see you next week. Goodbye.

Announcer:    The information featured in this podcast in general in nature, and does not take into consideration your financial situation or individual needs, and should not be relied upon. Before making any investment, insurance, tax, property, or financial planning decision, you should consult a licenced professional who can advise whether your decision is appropriate for you. Guests appearing on this podcast may have a commercial relationship with the companies mentioned.

 

NEWSLETTER
Be the first to hear the latest property investment insights
promoted stories
Email:

Top Suburbs

Highest annual price growth - click a suburb below to view full profile data:
1.
QUEANBEYAN EAST 48.78%
2.
BOOMERANG BEACH 46.38%
3.
HUSKISSON 46.32%
4.
ASHMONT 42.86%
5.
BALGOWLAH 40.63%
Why it's important to diversify into different markets
SPI logo