‘Long-term plans’ are keys to success in property investment

He shared: “I probably don't want to admit this too freely, but I did a course with a gentleman called Henry Kay … There are a few negative comments about him—not the most popular man.”

Despite this jumpstart into the wealth-creation business, he was grateful for the opportunity to be formally launched onto the landscape and the inspiration to actually go out there and buy properties across Australia. The property investor bought his first property with his former partner in Karumba, Queensland, a suburb of Brisbane. They also bought a little property in Tazin under her name. 

In 2004, the couple decided to sell the Karumba property to buy their principal place of residence in Wattle Grove. When they decided to separate as the marriage didn’t work out, Max held the property in Wattle Grove while his former partner held the one in Tazi.

According to him: “The one in Wattle Grove had a greater debt on it [but] I was able to manage that debt [as] she kept the other one, which was positive cash flow.”

He eventually bought a property in Minto last 2012 before selling the house to get some cash and continue his property investment journey. As expected, he made money out of the property, but not until after more than a decade since it was originally bought.

Max said: “I subsequently sold that a few years later to cash it out—possibly … a bit too early in the Sydney market, but the point of that one is … it did take a 10 years before it actually made money.”

A ‘long-term game’

Since deciding to continue his property investment journey, Max has made an interesting portfolio with a diverse set of real estate assets. Every property he holds has a specific purpose in his long-term investment plans. For instance, he bought cladded homes painted in “funky colors” so he can maintain the street appeal and continue adding value to the property in the future.

Max also has properties that deliver great yield, properties that deliver capital growth, and other properties that keep the balance in his portfolio.

At the end of the day, while he seeks different properties for different purposes, his main goal is to be able to hold them as long as possible to make the most out of their earning potentials.

Max said: “Property is not a short-term game. It's a long-term investment—you can't expect to make money in one or two years.”

“I mean, it's possible [and] you can get lucky if you buy at the right time, but realistically, you have to hold it for the long-term,” he added.

Smart Property Investment’s Phil Tarrant, who is an avid investor himself, agrees that creating a property portfolio and ultimately succeeding in the business of wealth-creation takes deliberate planning and long-term consideration. After all, nobody has ever gotten rich overnight through property investment because markets change constantly and success is a matter of making the right decisions at the right time.

Since property investment is a long-term game, Max also reminds his fellow investors to avoid beating themselves up over mistakes.

There’s always an opportunity to recover from a poor market cycle, he said.

The property investor said: “You've got to try and battle on as much as possible when things don't go your way … There's always tomorrow and there's always a better day ahead.

“When your tenant causes a bit of damage or you lose a tenant, don't worry [because] that can all be sorted out,” he concluded.

Tune in to Max Pagnin’s episode on The Smart Property Investment Show to know more about the benefits financial planning can have on your portfolio as well as several facts about Max’s own portfolio and how his background has shaped how he views the property market.