Newly-engaged couple Carl Smith and Phoebe Arthur started their property investment journey together in 2013 by buying a “dilapidated 80s cottage” and turning it into a brand new-looking water-front property—a project that they decided to take on by themselves, keeping them busy every weekend for two years.
Carl and Phoebe, who continue to live with Phoebe’s parents, admitted that they had an “emotional connection” to the property when they bought it, thinking that it could be their principal place of residence. They decided to use Carl’s skills and background on building to make the property as beautiful as it could get, but while it has indeed given them quite a good return in terms of rent, the couple agreed that investing two years on renovation is a mistake they will never do again.
"[We] could probably subcontract some of that stuff [in the future]... We won't do that again. I don't think we'd make the same mistake again—to invest two years of time into [renovating],” Phoebe said.
Carl added: “If we could afford it, I would love to do that… because it’s the smarter way to do it… I think the main thing with our first place is because we both said that we would like to live there… That's why I did it. Purely for that reason.”
As they move forward in their property investment journey, Carl and Phoebe still want to make use of Carl’s knowledge of building but only to a certain extent—to make sure that contractors are not ripping them off and to be certain that they’re making the most out of the money they are spending.
Smart Property Investment’s Phil Tarrant advised the couple and other property investors to look further than the potential for renovation when finding your next investment property.
“One of the biggest problems I think you're going to have is that one of your strongest points could potentially become one of your weakest points. Your strongest point being, ‘Yes, I can do all that work myself…’ [but] that's going to limit the type of properties [you can] look at… You should keep that in the back of your mind because you don't want that to dictate where you invest in property,” he explained.
“It would be depending on your circumstances, but there are better markets right now… that's going to give you a better return on investment in terms of growth and yield.”
As a seasoned property investor, Phil has proven that renovations are not as complicated as most people think it is provided that they find a reliable and efficient team to get them through the project. According to him, he manages to stay involved in the renovation of his properties by asking for regular updates from his financial and building team.
“[I] use a buyer’s agent [who can] video the home and show it all to me… so I am still involved and connected… Sometimes you're better off just detaching yourself and just paying to get a job done,” Phil concluded.
Tune in to Carl Smith and Phoebe Arthur’s episode on The Smart Property Investment Show to know more about the long-term process of renovating their first property, and how they found the latest design trends at just a fraction of the cost.