Hi all,
I was asked for an update on my investing story, and thought I would share with you all a bit of a wider view starting at the beginning…
As some of you may know I started investing in 2008 and the tail end of the last large boom in Victoria. Prior to this though I started educating myself on investing, property, leverage, etc. Studying accounting gave me a good feel for the numbers, signing up to here in 2005 and reading, learning and participating helped me get a feel for real-world issues with property investing and “shadow buying” in areas and watching the market move over those years between gave me the confidence that I could pick the right spots.
Then, as above, in 2008 I jumped in and bought a small 2 bedroom unit in Glenroy, Vic. Rented it for a 7.3% yield and the plan was a long-term buy and hold. I then soon after backed this up by buying a 3 bedroom 700sqm block in north Glenroy and moved in for 6 months. Both of these purchases were completed with a very high LVR. The unit was a $178k loan against a $185k purchase and the house was a $347k loan against a $347.5k purchase price. The reason for picking Glenroy was a feeling that it was quite undervalued when compared to suburbs close by – i.e. Essendon/Strathmore – this led me to believe that the CG “wave” had yet to reach the suburbs, which turned out to be correct.
I then decided to sell the unit, to help fund the house build, and then decided I still didn’t have enough cash or knowledge to do the build so sold the house and, for a while, was without an investment.
After that, and looking around I decided that Melbourne was too hot (this was mid 2009) and started looking at regionals. I looked at Bendigo, Albury and Ballarat and landed on Bendigo as I liked the government investment in the area, the size of the city and that it had started to evolve from just reliance on the surrounding farming (eg: Bendigo Bank). Also at this point I realised that buy and hold wasn’t for me in the short term. I like deal-flow, I like creating wealth and, in what I perceived to be a flat market coming, I wanted to do something more. So I bought a house on 4,900sqm and put plans on it for 10 units, had it approved by council and sold the block late 2011. Also during late 2011 I bought another block on 3,600sqm and am going through the hoops of plans for 9 on it and retaining the house.
This is where things get interesting. I am now moving to Bendigo to open a real estate agency.
I really believe in the area, love the lifestyle and think that it has a lot of potential. As an owner occupier you can get a lot more for your money than in Melbourne, and earn similar income (so can more easily afford the repayments). As an investor the returns are better from a yield point of view, the upside I feel is greater and the vacancy rates are some of the lowest in the country.
So, I have left my job, started hiring agents and admin staff, locking in a lease aimed at an open in March. I am going there under a brand some of you will know, and will be opening with a “splash”.
So this is the next chapter in my investing career, and the next move in my work career all rolled into one!
Cheers
Ben
I was asked for an update on my investing story, and thought I would share with you all a bit of a wider view starting at the beginning…
As some of you may know I started investing in 2008 and the tail end of the last large boom in Victoria. Prior to this though I started educating myself on investing, property, leverage, etc. Studying accounting gave me a good feel for the numbers, signing up to here in 2005 and reading, learning and participating helped me get a feel for real-world issues with property investing and “shadow buying” in areas and watching the market move over those years between gave me the confidence that I could pick the right spots.
Then, as above, in 2008 I jumped in and bought a small 2 bedroom unit in Glenroy, Vic. Rented it for a 7.3% yield and the plan was a long-term buy and hold. I then soon after backed this up by buying a 3 bedroom 700sqm block in north Glenroy and moved in for 6 months. Both of these purchases were completed with a very high LVR. The unit was a $178k loan against a $185k purchase and the house was a $347k loan against a $347.5k purchase price. The reason for picking Glenroy was a feeling that it was quite undervalued when compared to suburbs close by – i.e. Essendon/Strathmore – this led me to believe that the CG “wave” had yet to reach the suburbs, which turned out to be correct.
I then decided to sell the unit, to help fund the house build, and then decided I still didn’t have enough cash or knowledge to do the build so sold the house and, for a while, was without an investment.
After that, and looking around I decided that Melbourne was too hot (this was mid 2009) and started looking at regionals. I looked at Bendigo, Albury and Ballarat and landed on Bendigo as I liked the government investment in the area, the size of the city and that it had started to evolve from just reliance on the surrounding farming (eg: Bendigo Bank). Also at this point I realised that buy and hold wasn’t for me in the short term. I like deal-flow, I like creating wealth and, in what I perceived to be a flat market coming, I wanted to do something more. So I bought a house on 4,900sqm and put plans on it for 10 units, had it approved by council and sold the block late 2011. Also during late 2011 I bought another block on 3,600sqm and am going through the hoops of plans for 9 on it and retaining the house.
This is where things get interesting. I am now moving to Bendigo to open a real estate agency.
I really believe in the area, love the lifestyle and think that it has a lot of potential. As an owner occupier you can get a lot more for your money than in Melbourne, and earn similar income (so can more easily afford the repayments). As an investor the returns are better from a yield point of view, the upside I feel is greater and the vacancy rates are some of the lowest in the country.
So, I have left my job, started hiring agents and admin staff, locking in a lease aimed at an open in March. I am going there under a brand some of you will know, and will be opening with a “splash”.
So this is the next chapter in my investing career, and the next move in my work career all rolled into one!
Cheers
Ben
