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I am Roberto and this is my IP story so far…

Discussion in 'Introductions' started by roberto, 23rd Jun, 2015.

  1. roberto

    roberto Member

    Joined:
    22nd Jun, 2015
    Posts:
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    Location:
    Australia
    Hi All,

    I am Roberto and this is my IP story so far…

    2005: Migrated to Australia with my wife in our late 20s, with $9K and basic functional English. Luckily we both had skills that were in high demand at the time and got our jobs within weeks of arrival.

    2006: PPOR 1. We saved enough for a deposit and purchased our first PPOR in Sydney for $315K. A 2B/2B/2C apartment in Sydney’s Upper North Shore. A high rise building on a busy road with very expensive strata (you know, the kind of property that savvy investors avoid J ).

    2007: IP1 and Child 1. While we both worked we saved enough for another deposit and purchased our first IP, a 3B/2B/2C house in Melbourne’s South East (40 KM from the CBD) for $270K with 6% yield. Last valuation was $380k, so even though CG has not been spectacular it has been cash flow neutral since acquisition, so not bad for our 1st IP.

    2008 – 2009: Quite period on the RE arena. My wife stopped working after our first child was born. Expenses went up, Income went down, our saving rate decreased substantially, but we managed Ok during this period.

    2010: IP2 and Child 2. IP1 went up in value, extracted equity for deposit and costs and purchased IP2, a 4B/2B/1C in Sydney’s West (Blacktown) for $377K with 6% yield. Last valuation was $500K (before the BOOM) so it should be around $600K at the moment. Initially it costed around $3K-$5K after tax to support it, but with the current interest rates it is neutral. Obviously very happy with it.

    2011: Sold PPOR. There were many building under construction and a lot more in pipeline so I thought it was going to create an oversupply of apartments and it would impact negative on values. So I convinced my wife to sold our apartment for $450k and rented a place for the next couple of years. I think I got lazy in the investment arena and focussed on career too much, as a consequence I lost 2 years of investment.

    2013: Purchased new PPOR. One day I woke up and realised Sydney was moving, so we started looking and purchased a new PPOR, this time a 3B/2B/2C apartment in Sydney’s Upper North Shore in an small building for $570K. Wow, just in time. 2 years later it is worth around $800K.

    2015: IP3. Extracted equity for deposit and costs from IP2 and purchased IP3, a 3B/2B/1C townhouse in Brisbane’s South for $335K with 6% yield.

    Future: The plan is to acquire 3 more IPs around $350 to $400k with 6% yield in the next 2 years. Then let the ,arket do its thing and wait until the portfolio reaches our magic numbers of $4.7M with 50% LVR. By then we will be in our late 40s or early 50s (depending on market), our youngest will be at University and the PPOR will be fully paid off. So ~$120k of passive income (in today’s dollars) should be OK for us to retire if we want to.

    I am looking forward to learn from others and contribute where possible.

    Regards,
    Roberto.
     
  2. Azazel

    Azazel Well-Known Member

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    Hi Roberto, that's a pretty busy 10 years, good work!
     
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  3. RetireRich101

    RetireRich101 Well-Known Member

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    I was waiting for "2015 IP3 and Child3" but I guess Sydney is too expensive for this..
     
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  4. KDP

    KDP Well-Known Member

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    Location:
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    "2010: IP2 and Child 2. IP1 went up in value..."

    When I read that quickly I thought you said "Child 1 went up in value".

    Welcome and great achievements Roberto!
     
    Last edited: 23rd Jun, 2015
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  5. MRO

    MRO Well-Known Member

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    Well done Roberto. It is good to see how others have progressed.
     
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  6. Sashatheman

    Sashatheman Well-Known Member

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    Welcome. Why did you decide to buy your first IP in Melbourne while living in Sydney?
     
    Arnel likes this.
  7. roberto

    roberto Member

    Joined:
    22nd Jun, 2015
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    Location:
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    Thank you all for the kind words.

    @Sashatheman
    In 2007 South East Melbourne offered 6% yields and I thought it was about to start growing again. So the potential of short/medium term CG and good cash flow was attractive to me.

    My aim is to have the portfolio distributed between Sydney, Melbourne and Brisbane in areas that are slightly under the median price for the city and that offer good cashflow. I try to purchase in quiet times where not many people are buying.
     
  8. skater

    skater Capitalist Premium Member

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    Congratulations! You've done well.
     
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  9. Michael_X

    Michael_X Mortgage Broker Business Member

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    Gold Coast/Sydney
    Nice work Roberto :)
     
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  10. jafeica

    jafeica Well-Known Member

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    Good story, this may be a stupid question or I may have missed it, but why is the magic number $4.7m?
     
  11. Rixter

    Rixter Well-Known Member

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    Portfolio Perth Brisbane Sydney Melbourne
    Congratulation Roberto, you've done very well. Good Job.
     
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  12. Gingin

    Gingin Well-Known Member

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    Well done mate, joe hockey would be proud!
     
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  13. roberto

    roberto Member

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    Because at 50% LVR and assuming 5% of yield you should be able to generate income of aprox $120k per year.
     
  14. Jingo

    Jingo Well-Known Member

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    Location:
    Melbourne
    Inspirational read, you've been extremely busy both on the family and investing front.
     
  15. Catalyst

    Catalyst Well-Known Member

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    Location:
    Perth
    Very inspiring, @roberto :)

    How did you educate yourself prior to IP1....and thereafter?