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Investing 101: Don’t be afraid to stray from your own backyard
Investors willing to expand their horizons and invest in unfamiliar territory could take advantage of stronger-performing markets nationwide.
When starting their property journey, many Australians first target properties in their own backyard, usually with little support and data, as was the case for Sudesh Piyatissa.
Piyatissa began his real estate journey in his 20s, inspired by his older brother to invest in property.
Piyatissa has since built a portfolio of six properties across NSW, Victoria, Queensland, and Western Australia.
“He was the push. He said, ‘Save your money, save a deposit, buy a house and then go from there’,” Piyatissa said.
“Property has always been what I enjoy, because it is tangible; you can leverage it as opposed to shares.”
For his first two properties, Piyatissa had little knowledge of or data on the market, targeting house-and-land packages on his home turf of Melbourne.
Following a divorce in 2021, he purchased a principal place of residence (PPOR) unit in Melbourne, which he said was the catalyst for the change in his mindset about property investment.
“After living in it, I realised that $1.5 million in one basket could be better spent across three properties across Australia,” he said.
Once he decided to diversify his portfolio, Piyatissa sought professional assistance to guide him in achieving stronger results by buying assets across state borders.
“Having that mindset change was really key to buying interstate. Just seeing it in front of me and seeing what properties can do rather than the ones in my backyard,” he said.
“I wish I did this earlier; diversifying my portfolio was something that I wanted to do. I don’t want all of my eggs in the Melbourne basket.”
Long-term impact
Piyatissa said that, beyond creating wealth through his property portfolio, it had also significantly benefited his personal life in other ways.
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“It is allowing me to have more of the greatest asset that I feel, which is time,” he said.
“I find that I can spend a bit more overseas or time with my loved ones, and that’s been the biggest thing for me with this journey. It buys me time.”
He said that at this stage, his portfolio is more centred on equity growth over income.
Piyatissa said that a switch to income-focused assets would happen at some stage, but was “still years away”.
“All of these properties, they are the long-term play that will allow me to have an income down the track,” he said.
Piyatissa said that, with the property market constantly changing and driven by factors beyond investors' control, it was important to ensure they had a portfolio strategy they felt secure with.
He said that while a strategy may perform better or worse than expected over time, investors need to trust in the decisions they made at the time.
“We can’t predict what political parties are going to do and what new legislations are going to come in, but what we can do is what was right at the time,” he said.
“If it allows us to be a bit more financially free later down the track, that brings me comfort.”
Having recently made a purchase just before the SMSF cutoff, Piyatissa said there would always be opportunities for investors to transact.
He said that many of the recent changes had caused him to transact faster than originally anticipated.
Additionally, Piyatissa said that one of his biggest tips for investors looking to begin building their own portfolio was to stop waiting for the perfect time.
“It would have been great to have made these decisions 10 or 15 years earlier, if you have the capacity. They say the best time to buy was yesterday, and the next best time is now.”
“So instead of waiting for all your ducks to line up perfectly, do something to help that process.”
Listen to the full episode here
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