When Shaun and I told people we wanted to buy an investment property they said we were insane.
They said home loans were impossible to secure, repayments were hard to keep up and tenants were assholes who would trash our property.
I wish I could say they were all vicious lies but if I’m honest with myself there is probably some truth in all of those statements.
Buying an investment property when you’re twenty years old and still at school is terrifying and when Shaun first pitched the idea to me I was vehemently against it.
I liked seeing my balances rise week after week and while I would have happily dumped it all on a holiday, I wasn’t going to let a house suck my savings dry.
Stupid, I know.
Shaun had investment know-how, an entrepreneurial spirit and enough finance to split the deposit and if I was ever going to do this crazy, spontaneous thing, it was going to be with him.
If you asked me how it was going a couple of months ago, I would have told you I fucked up big time; that I was in way over my head and that it was the biggest mistake I had ever made.
I was working a forty-hour week alongside a fulltime university degree. I was planning a twenty-first birthday party, desperately trying to keeping up a social life and doing my best to stay fit.
I was physically and mentally exhausted and the last thing I needed to worry about was chasing brokers, dissecting insurance policies and poaching property managers.
It was tough but I did it. I was an adult for a couple of months and after eight weeks our renovations were complete, an agent was secured and a beautiful family decided they wanted to live in our home.
Their rent covers our mortgage, our property manager takes care of our inspections and to be honest, it’s like we don’t have a house at all.
As a notoriously stubborn woman with a rock hard head, my advice to you is this:
Shaun and I went to hundreds of auctions but each property sold far above the asking price. Shacks in the middle of nowhere were advertised for less than $300,000 and selling for more than $450,000.
It was ridiculous and we couldn’t get a bid in.
At one of the last Auctions we went to, an old bloke told us to look in regional Victoria. My mind shot to Sovereign hill, the gold rush and an old mining town out in the country. When we went, it wasn’t like that at all.
Ballarat was beautiful. It had lakes and botanical gardens. It had schools and hospitals and universities. It even had a shopping centre and a couple of hipster cafes.
It impressed me.
The house did not.
It was an old place covered in mismatched wallpaper and pink furniture. Each wall was painted a different colour, the carpet changed in every room and the curtains were hideous. I barely looked at the thing; I thought it was a dump and that no-one in their right mind was ever going to want to live in it.
Shaun loved it the minute he walked in. He had an investor’s mindset which meant he could look through the clutter and see it’s potential.
All my stubborn ass could see was the old woman who used to live there.
Set a Realistic Timeline:
This is a big one.
Shaun and I were rookies and assumed we’d get renovations done and tenants paying our mortgage in a month.
We forgot that we could only make it to Ballarat on weekends and that the property couldn’t be advertised until the place was fixed up.
The real estate agent then had to sift through the applications and complete rental history checks. She also had to negotiate a day for the tenants to move in which ended up being almost a month after the contract was signed.
Guess who had to pay the mortgage for that month?
We did and after debiting for our deposit and stamp duty, those fees hit us hard.
That’s another thing I learnt;
Be financially and emotionally prepared for all the money that’s going to come out of our bank account:
You’ve just got to open up your accounts and detach yourself from the transactions because the bills don’t stop; you pretty much bleed cash.
Have some fun with it:
The whole family came down to see the place.
We had tunes playing out of an old school boom box, pizzas on order, and beers in the fridge. We even spent a couple of nights camped out in the backyard.
It wasn’t easy but with white walls, a new kitchen and whole lot of help from our families, this old place transformed.
What do you think of our DIY hackjob?