Sydney Based Growth Portfolio

Hi All,

I am a Chartered Accountant and a buyer's agent based in Sydney.

My property story actually began nearly 18 years ago when I purchased my first investment property - a 2 bedroom unit in Artarmon (Sydney's lower north shore).

The property was in a state of dis-repair - old kitchen, old carpet, and the front door holding on by a thread.

This property became the foundation for the portfolio that has grown over the subsequent 18 year period.

I have built a Sydney-based property portfolio focusing on three ingredients that always work:

1. Location: Buying in awesome locations, but avoiding the premium of new or off the plan. Walk-ability, particularly to transport is a critical criterion;
2. Land content: low-rise properties where the land is driving the appreciation.
3. Layout:- liability. No bathrooms off the living room!


Eventually the decision was made to add to the portfolio with one acquisition per year. Not too fast, not too slow. Realising that property is a game of inflation, compounding and time, the focus was on asset accumulation, in a particular logical order.

I now have properties in many parts of Sydney.


My full story is in the Smart Property Investment podcast - see below.

Now I am a buyer's agent. My job is to help people purchase the right sort of properties that create enduring generational wealth.

Best,

John Comino

Podcast link below:
A purely Sydney-based portfolio - Smart Property Investment

 

wow that's amazing, great job on your journey so far!

Care to share some specific numbers

How did you "grow", what were your wins, losses, challenges, learnings along the way?

Inspirational stuff

 

Hey John

Well done for managing to almost replace your income- no mean feat Interested to know what your land tax bill is like?

 

Is this an advertisement or something?

 

I checked out your site John, including your socials. Facebook says you're a leading buyers agent focussing on Sydney, Melbourne and Brisbane. Thats a pretty big claim, are you licensed to act as a BA in all 3 States?

 

Well done John, reminds me a bit of this:
Outliers: The Story of Success by Malcolm Gladwell

 

Hi Fols, partners in VIC and QLD, although I am working on that. Most of my buying is in Sydney though.
Kind regards,
John

 

Hi Jacque,

Yes, this bit certainly hurts. Although the $10m includes the PPR.

Kind regards,
John

 

Thanks Hwangers,

I have made loads of mistakes. Still learning, and not the finished article by a long stretch.

I can say that we have 8 properties in Sydney, one of which is the PPR. Half were purchased between 1999 and 2013, and the other half between 2014-2017. So we did start slow and sped up later on.

The big learning is to start as early as possible, and then try to be patient (but not too patient). The first property purchased in 1999 was in Artarmon, and a pretty shabby unit at that. This was purchased for under $150k at the time, and we have been able to harvest this one a few times for subsequent purchases. Ours is definitely an old fashioned "time in" story.

Our best performing properties are in the more established areas. The portfolio has a mix, but most are walk-up units.

My biggest challenge is the new APRA lending requirements, particularly around serviceability. We have had some costly repairs on some recent purchases, so cash flow is something we still have to watch closely.

So we are in a "sit and wait" mode on the portfolio right now, but hope to become active again later on.

Hope this helps.

 

Of course it is, but I'd prefer to talk to someone who has walked the walk, and is prepared to put themselves out there.

Many other business members on here do similar, and the ones that shine are the ones that contribute generously on this forum. I enjoy reading the stories and advice from the business members - it is not often you get to find out so much about someone before engaging them professionally. Certainly helps to determine compatible personalities.

If John is able to continue to contribute, and expand on his story, we will get more of an idea about what he is capable of, and how he can help the rest of us.

Cheers,
Inertia

 

This

 

The assets might be $10M, but how much debt?

What are the net cash flows (positive or negative) after interest, land tax, rates, property management fees, R&M and other outgoings?

What’s your breakeven interest rate?

Are the loans P&I or interest only, or a mix of both? For interest only loans, what’s the maturity of the various loans? Will the lenders require conversion to P&I at the end of the term, if so what does that do to your cash flows?

Saying I have $10M in property might sound impressive, but it tells us very little about your financial position.

 

10m asset base, whether low LVR or high to me doesn't matter. Its a larger asset base than most will ever dream of building.

 

Absolutely. And John started buying 19 years ago, so it's not hard to imagine that his overall LVR would be under control.

 

Hi Guys,

LVR is 58% and loans are a mix of P&I and IO. Older properties now yield about 8%, newer properties now yield about 4%. Obviously I am not giving away my cash flow or land tax details, but it is true to say that managing cash flow is the biggest challenge, although this varies year to year depending on maintenance and special levies.

My strategy has been to focus on growth properties over yield properties, buy and hold, and accumulate slowly. For any growth investor, the real money is made in the second ten-year period, but it is worth it in my opinion.

Best,
John

 

Well done on your acquisitions John, and thanks for being so open.
Agree that managing cash flow is key to eliminating future headaches.

 

Thanks for the feedback John, best of luck on your journey.

 

You've already mentioned cash flow being a challenge - given the changing landscape of the lending environment, how would you reflect on your journey, vs someone starting out now? Would you say cash flow properties would need to feature more significantly in the portfolio?

Cheers,
Inertia.

 

you might be surprised.