Curtis Stewart started his property investment journey in his early 20s — a feat that might seem a bit overwhelming but definitely achievable with the right amount of education and good mentorship. His entry point? Canberra.
The young investor was 24 when he decided that property is his best way to create wealth.
According to him: “It was [about] finding a way to use what [I] have to move forward in [my] investing journey.”
“[I] did the research [and thought], ‘Well, how do I use [the savings] I have to start climbing up the ladder?’ Property was—for me, at least—the answer,” he added.
Find out how Curtis jumped the hurdle that is making his first purchase, as well as why he believes that “conservative towns” like Canberra can ultimately bring success to property investors:
Where did you buy your first property?
Curtis Stewart: It's in Wright ... which is one of the new suburbs in Canberra, in the Molonglo Valley. It was about 10 [to 8]-minute—depending on the whether I caught the red light or not—to work.
What made it an appealing location for you?
Curtis Stewart: There was a whole bunch of new developments, new land releases, [and] new apartment buildings going up in that area.
How much did you pay for it?
Curtis Stewart: Ended up buying it for $275,000 off-the-plan [in 2015] which is one of the criterias you need for the stamp duty exemption … [It] has its pros and cons, but in this case … the stamp duty exemption tipped it in favour of that direction.
What was your total money down?
Curtis Stewart: It was about $20,000, and then there was legal fees and stuff, [so] it would have been about $22,000 or up … [in] cash, obviously.
How much is the property worth today?
Curtis Stewart: It's interesting, actually. The bank thinks it's worth a lot more than I do, which is always nice. I reckon it's worth about $330,000 [to] $340,000 … based on other sales, but the lovely people at CBA, they think it's worth $380,000.
If I actually sold it, I think $340,000 is more [likely] what someone would actually pay for it. It's always nice when the bank takes a more aggressive position than reality.
Are you going to keep this property?
Curtis Stewart: Yeah, yeah, I'm going to keep it [because] it yields quite well … It brings in about 5.5 per cent [to] 6 per cent, so it brings in $350 a week.
What do you think can put positive pressure on your investment so it continues to go up in value?
Curtis Stewart: There's lots of new [houses] being built … There's a lot of supply, I guess, in those particular suburbs. I don't think prices are particularly high or the pressure isn't too high.
I'm a little bit of a believer in Canberra more generally … Subsequently, I do think land is going to be more valuable than an apartment in terms of capital growth … I think it's got really healthy incomes, it's got [a] really stable employment, unless the government announces it's going to slash a bunch of jobs which does happen from time to time.
I think it's my read on the people and the market there is that there's a lot of owner-occupiers at quite low LVRs [loan to value ratios]. If interest rates went up, I would imagine Canberra would be one of the last places in Australia to be affected by … mortgage stress.
Do you think investors should pay more attention to “conservative towns” like Canberra?
Curtis Stewart: It's quite a conservative town with a lot of capital and a lot of wealth and a fairly high income. I think, going forward, the population there has the capacity to pay for the prices and the rent. Yes, there's a lot of land available, which puts downward pressure on prices through increased supply. [But] I think that demand side, the other side of the equation, is quite healthy in Canberra and sustainable as well, which is [what I look for in] some other places—I do wonder how sustainable the demand is.
What would be the best indicator of a good area for property investment?
Curtis Stewart: [I] am a bit of a believer [that], especially on demand side, where there's jobs and job creation and good job prospects, that underpins that and supports it. Canberra's got … a fairly robust job market, its government's the employer, [and it has a] highly-educated population.
Tune in to Curtis Stewart’s episode on The Smart Property Investment Show to find out why he took a gamble and purchased two blocks of land in two different developments as well as how his mortgage broker skills help fuel his investing.