Join us as we discuss his childhood and tailored education and how that led him to sunny Brisbane. We’ll take an auditory trip to Poland as Borek describes his upbringing in a 16th century tourist town, and we make a stopover in London where he takes us through the dilapidated house he rented and transformed, setting him on his path to property investing. We’ll also hear about the beginnings of his journey in Brisbane and the property that, along with some clever negotiations, completely changed his mindset amidst a growing pandemic.

Timestamps:
04:33 | From Construction to Engineering
06:38 | Growing Up in Zamosc
10:56 | A Hands-On Education
14:49 | Joining the European Union
19:59 | Welcome to Australia
21:49 | If There’s a Problem, I’ll Solve It
22:39 | Buying in Brisbane
27:14 | Holy Shed!
29:36 | A Quick $100,000 Profit

Resources and Links:

[00:21:10] It was a three bedroom house and original house built in the '90s. So everything had to be done. 20 years, no bathrooms, kitchens was not touched. And we didn't have kids at the time, so it was just an easy one. We could do it after work or whatever. So that was the first property and we lived there till 2013. And we sold it for a profit. 

 

This is Property Investory where we talk to successful property investors to find out more about their stories, mindset and strategies.

 

I’m Tyrone Shum and in this episode, we’re speaking with mechanical engineer Premek Borek. We’ll learn about growing up in a 16th century Polish town and his technical high school training. Discover how his travels across the UK led him to Australia and how he made $100,000 profit with one property in just five weeks!

 

 

Borek immigrated from Poland to Australia in 2007, with stints in Ireland and the UK in between. This is where he realised his property dream, but he is still focused on his career in engineering.

Premek Borek:   

[00:03:58] Day to day, I'm still a full-time employed professional. I'm a mechanical engineer by trade. I've been doing that for the last 20 years, about. It's not too bad, for engineering minded people, but I always wanted to do something different. And I think running a small business will be definitely a thing I would like to do and property seems to be the way to do it. 

Tyrone Shum:  

He gives us some insight into how he got into mechanical engineering.

Premek Borek:   

[00:04:33] I think it started probably at high school because it's a bit different system back home. And I actually went to a Technical High School, if that makes sense. So the profile was construction industry. So I got into the construction first. And after that I had to pick a university and because I already was in that construction profiled school, I thought maybe an engineering degree would be something that I would benefit from. 

 

[00:05:01] So I picked a civil engineer, faculty as a main subject. However at the end of the course, I decided I wanted to do a little bit more in mechanical engineering, which is building services, basically. And that's how it all started. So after that I got my first job, in the hospital in the engineering team. So you learn a lot of things in the hospital, because it's a 24/7 operational facility, and everything's critical over there. So that was good there for six months. 

[00:05:14] And after that, I immigrated to Ireland. So I work for Intel over there, and Pfizer, which is microelectronic companies and pharmaceutical companies. And for some reason, here, I'm still involved in hospitals and highly specialised laboratory projects. So that's how it all started.

[00:06:06] Our clients are predominantly builders and managing contractors. So we work with them, as well as consultants, architects, electrical engineers, civil, etc, etc. 

Tyrone Shum:   

He describes the historic Polish town he grew up in, near the Ukranian border.

Premek Borek:   

[00:06:38] The place is called is Zamosc. Probably not many people can pronounce it, but it's a southeast corner of Poland, about 60km to the Ukrainian border. It's a relatively small town, about 70,000 people, but it's got a big history behind it. It was established in16th century. So a lot of heritage buildings in the town center and things like that. And it's in a beautiful region. There's lots of touristy places, national parks around it. I always enjoyed living and growing up in that city and going on some trips with parents.

Tyrone Shum:   

[00:07:18] Wow. That's amazing. Have you been back there since?

Premek Borek:   

[00:07:21] Last time, I think we went there in 2016. And there was a plan to go there last year, which obviously didn't happen due to the global pandemic. But we usually try to go back and see parents and family and everyone else every two, three years, if possible. 

[00:07:46] I think Poland as a country gained quite a lot when it joined European Union in 2004. So every time we go there, because it doesn't happen often, every two, three years, you can actually see those changes. The first one is definitely the routes. The infrastructure is just unbelievable, like, from my hometown to my wife's hometown used to take me 12 hours to get there. Last time it took nine because there's motorways now that you can travel 140km/h, which is great.

Tyrone Shum:   

He expands on his childhood and how exploring with his dad led him to where he is today.

Premek Borek:   

[00:08:30] As a kid, I also lived with grandparents, it's a bit of a cultural thing. People live with the older people. I remember Grandma and Grandpa always being around, taking me to school and teaching me things, because parents were busy at work. So after school I used to spend a lot of time with grandfather. Unfortunately, he passed away when I was eight years old. But I still remember it. So obviously, it's embedded in my brain. That was really enjoyable time, I guess.

[00:09:12] My mum, she used to work as an admin in the local furniture factory, but she didn't last there long. She just wanted to be working mum at home, looking after the house and things like that. But my father, he worked for the local government as a land surveyor, so he worked in the town planning division. So as a kid, I used to help him a lot on the weekends, we'd go somewhere in the countryside and do some site survey and land survey. So I am across it, which is very helpful now, because I know how their instruments work and all the technical things behind it. 

[00:09:55] He retired three years ago, and that was a time when I realised that I have to do something about my life, too. Because I could see myself following his path completely. Like, work for 40 years and then just pray for retirement, basically. So unfortunately, they didn't save any money or anything like it. So they purely rely on the government. And it's not something I would like to do. 

Tyrone Shum: 

Borek’s hands-on schooling taught him methods that he still uses in his work today.

Premek Borek:  

[00:10:56] The primary school and secondary school, they were all in my hometown. And the secondary school was a five year term. And basically, because it's added construction profile, once a week we had to work on the construction site. Obviously at that age, you can't do much, other than just clean the site and basically get someone some stuff from the shops. But you kind of learn a lot, because progressively we were allowed to do more, like doing paving or some basic concreting, bricklaying and stuff like that. Which was really good. Because some of the skills I picked up back 20 [or] 25 years ago, I still use it. So that was secondary school, and then in my university was about 100 kilometers north of my hometown, so I had to relocate. And that was a five year course.

Tyrone Shum:   

[00:11:58] Wow, when you said secondary school, that is equivalent to high school here? Is that what you mean?

Premek Borek:   

[00:12:03] That's correct. it's almost like TAFE here, it's a bit of like a TAFE, because you get that practical knowledge and theoretical knowledge. So we had to learn about foundations, roof structures, and stuff like that. Obviously, at the very basic level, not much in terms of calculations, but you had to have that knowledge. So as a building services engineer, I knew exactly, 'Okay, before I can penetrate the slab, I actually need to check with structural engineer, because there may be some steel there that I don't want to damage.' So it gives you a very good background and knowledge. You really appreciate other services in the building and construction industry.

[00:13:15] When you spend a day a week on site, whether you want it or not, you will still pick up a few things. Even when they ask you to push a wheelbarrow for eight hours a day, you still get to see things. And some silly things, there was lots of laughs!

[00:13:57] After I finished uni, after five years, I did come back to my hometown, but only for about six months. And there was a time when I picked up a first job with the hospital in town. But after six months, they did offer me a permanent position. However, I didn't accept it. And that was a time when Poland joined European Union. So there was lots of young people already going west. And that was the same for me. I just wanted to go there and learn the language, earn some money and potentially come back. So the plan was only for a year. But 14 years later, we are still traveling!

He gives some more background on the effects joining the European Union had on Poland.

Premek Borek:   

[00:14:49] Poland joined the European Union in 2004, and I remember it was the 30th of May, I remember it exactly, because it was my birthday. And two weeks later I was already on the plane to Dublin. So I can't probably really comment much how it changed because I wasn't there when all the things happened. But talking to family and friends who lived there, they could definitely see the benefits of that major— well, I don't know if you'd call it a major. 

[00:15:20] But even things like no borders, very easy travel and things like that. As I said before, the improvement in the road infrastructure and things like that was was definitely a plus, especially when you go to the western side of the country, which is close to German border, and you won't even see the difference that you are in a different country, because the shops and everything is pretty much the same level. So that was definitely something that was quite, not so much shocking, but definitely interesting and positive.

 

[00:16:32] You look at Europe and Poland is surrounded by a few countries, not just one. So yeah, everywhere is a border control. Poland still has it on the eastern border, like Ukraine, obviously, is not part of the European Union. So the border is still there. But yeah, everything further west, there's no borders. Which is great. When you travel, you don't have to stop.

[00:17:09] We used to travel quite a lot to Czech Republic and Slovakia, just with the group of friends, over the school holidays. So that wasn't the first time there. And before that I had been to Germany a couple of times, my father's friend lived there. So I used to go there for school holidays, and do some gardening or stuff like that, just to earn some extra money. 

[00:17:38] So I knew that pretty well. And before the Poland joined the European Union I actually went to UK with a group of friends, just to visit some other friends that lived there already. But we had to go through that very strict process of passport control and stuff like that. So I remember that very well. And that was interesting. Later on when we didn't have to do it was like, ‘Wow, that's great.’ 

Tyrone Shum:   

[00:18:05] That is amazing to hear. And what about language? Was there any language barriers at all going through? Because I know, I've been to Germany, and most people over there speak German, but also, too, speak English as well. But obviously German has been the main language. So when you're traveling outside of those countries, what was that like for you? 

Premek Borek:   

[00:18:22] I tried to speak English whenever I could. I tried to learn German at school, but it just doesn't sink for me. I don't know, it's one of those languages that I have difficulty to learn. And the same with French for whatever reason. So yeah, they were happy to talk English like most of the people do. And yeah, that wasn't really an issue.

[00:18:58] Dublin, we spent almost a year there. As I said, I worked for Intel and Pfizer, two big factories over there. And at that time, I couldn't really get a job in my profession. It was kind of close to my profession, but not to my full potential. And I didn't really like it. I felt like I was going backwards. And at that time, I made a decision to move to UK where we knew that people are a little bit more open to Eastern Europeans. So about a year in Ireland and then two and a half years in UK, North London.

 

Coming up after the break, we hear how Borek dealt with moving to Australia just as the GFC hit...

 

[00:01:41] Then we moved to Australia in 2007, things were pretty smooth just before the GFC. And when the GFC hit, we bought the first house, which we renovated as well, and then sold it with a profit. And we had a bit of money on the side so we thought, 'Maybe we'll just invest that money somewhere else.' 

 

He shares the magic ingredient at his Brisbane renovation that had the neighbours dropping by...

 

[00:27:14] And the other good point about that property was a big shed. It had a six by 12 metre, 72 square metre shed. The previous owner used it for a home business, like an auto repair business. So it's relatively tall too. And we knew that that would be a good selling point. 

 

He delves into the story of another property he was partway through developing when COVID-19 came along.

[00:29:36] But after Brisbane went into lockdown, that was it. Phones just stopped calling, at all. So quick, had to find a way, okay, what do we do about this property? 

 

And that’s next. I’m Tyrone Shum and you’re listening to Property Investory.

 

 

Tyrone Shum:  

Borek met an Aussie from Cairns while he was working in the UK, and this encounter-turned-friendship plus a quick renovation in London set him on his path.

Premek Borek:   

[00:19:59] We became really close friends and he was telling me about Australia, about the life here and the lifestyle generally, and I managed to convince my partner at the time to just come here and visit for a year, at least. 14 years later, we're still here. But Canada was the other country we wanted to visit. However, given the lifestyle we get here and the weather, I don't think it will ever happen.

 

[00:00:58] I remember we were renting in North London. And we found the place which was a pretty dilapidated house, and the price was pretty cheap for rent. And we just said to the owner, that we'll just do a quick renovation and see if they're happy with that. And actually, they didn't see what we did to the property. And it was me and my partner at the time. And when they came to visit about three months later, they were like, 'Wow, you really transformed this place!' But I was hoping that the time that they would increase our rent. By doing this, we're allowed to actually sublet some of the rooms. So overall we live pretty cheaply, in a relatively expensive place in the world. So that was my startup journey. 

[00:01:41] Then we moved to Australia in 2007, things were pretty smooth just before the GFC. And when the GFC hit, we bought the first house, which we renovated as well, and then sold it with a profit. And we had a bit of money on the side so we thought, 'Maybe we'll just invest that money somewhere else.' And we decided to buy a block of land in Poland at the time. My father used to work for the government at the time. So he managed to find cheap land from the government that not many people knew about. So that's how you buy cheap when making money when you buy basically. 

[00:02:23] There was another trigger, like, yeah, there's definitely money in the property. Then we bought another land here in Australia, we build a house, and we did most of the work ourselves, which obviously increased the value, and we managed to pull out some equity. And when I use the service of the buyer's agent to buy a first investment property, which we still have, and again, this one was under the market value, you had a bit of a renovation, which we did, which obviously increased the rental yield, we still have a tenant in place that is good and pays money every month, which is great. And that's how I realised, 'Hang on, there's definitely money in property.' It's one of those houses that never depreciates. It always appreciates in value. You can buy cars and everything else but...

Tyrone Shum:   

[00:03:09] Property doesn't depreciate.

Premek Borek:   

[00:03:10] Exactly. It's one of those things. So that's how I got into property basically, I started reading books and attending courses and Young, obviously, with his courses kinda encouraged me to do a little bit more. So I signed up to a three day daily bootcamp and the advanced property formula course and three months later. 

Tyrone Shum:   

He purchased his first Australian house in 2009, renovated it in his spare time, and sold it for a tidy profit. 

Premek Borek:   

[00:21:10] It was a three bedroom house and original house built in the '90s. So everything had to be done. 20 years, no bathrooms, kitchens was not touched. And we didn't have kids at the time, so it was just an easy one. We could do it after work or whatever. So that was the first property and we lived there till 2013. And we sold it for a profit. 

Tyrone Shum:  

A typical engineer, he has always been on the lookout for things to fix, and this house was one of them.

Premek Borek:   

[00:21:49] It was probably just me always looking for ways to improve things. And that could be me being an engineer, we always try to solve problems. And we thought, 'Well, we've got that limited budget.' And we knew roughly where we wanted to live. We wanted to be close to the transport, so we can get to the city to work quickly. And with that limited budget, we knew that we wouldn't be able to buy something that's already ready to move in, but something that you don't have to touch. So we selected that property. We knew we had to spend another $50,000 [or] $60,000, and that's what happened. 

Tyrone Shum:   

[00:22:28] Whereabouts in Australia did you purchase that?

Premek Borek:   

[00:22:31] Brisbane in Seventeen Mile Rocks, which is on the western side of the CBD.

Tyrone Shum:   

[00:22:39] After that you sold that property for a profit? How many years did you hold on to that property for? 

Premek Borek:   

[00:22:46] Four years. We sold it in 2013. Because at that time we had our first child, and it was only three bedroom house, so we thought, 'Yeah, probably we'll be good to move to a bigger house if we're planning for the next child.' So that was the target. That was the decision maker. But the next one we wanted to do something different, like build, definitely build something. So we found a block of land, again, in the same suburb, Seventeen Mile Rocks. We selected a builder, then again, I tried to exclude as many things as I could so I could do the rest of the other things myself.

His engineering and construction backgrounds came in handy yet again during the build, and other than one incident with a sparky, it went off without a hitch.

Premek Borek:   

[00:23:43] We didn't have any issues with the builder at all. And that's probably partially me understanding their construction relatively well. So I could look at the drawings, I knew exactly where the power outlets need to be, or the hot water system had to be on that side of the building. I know people sometimes struggle with things like that. And halfway through the construction, they realise, 'Oh, no, we can't have it here.' So I could already imagine that in my head where I want certain things.

[00:24:12] And as I said, we didn't really have many issues at all. If anything, I think there was only one incident with the sparky, the electrical guy, where he didn't install the outlet in the kitchen where we wanted it to be. But he quoted us, and was pretty much couple days before the handover, and the outlet was still not there. And I said, 'Well, I can't accept it.' And I complained to the builder and I remember this guy was really upset that I complained about it to my builder. I think that was only one incident. He had to come back pretty much on the day of practical completion and basically install it and I remember he did a lot of mess and he did it deliberately.

Tyrone Shum:   

[00:25:01] Well, what have they got to lose? They know that the project's finished, they're gonna hand it over. You know, just get it done.

Premek Borek:   

[00:25:07] Well, that's right. And he was happy, 'I'll give you money back.' I was like, 'No, I don't want money back, I want my outlet to be installed.' And I think that's how the argument started. But at the end of the day, he finished it and we moved in a couple days later. 

Tyrone Shum:  

During the build, he was also in the midst of purchasing a block of land in Poland.

Premek Borek:   

[00:25:44] It's in a touristy area. It's partially commercial and residential. So we know that if we hold on to it, it will just grow in value there. So that property has been fully paid off. And we don't have anything owing on that one. And it doesn't cost us much to maintain, too, which is good. 

Turning to his investment journey, Borek found a great opportunity with an ‘80s fixer-upper in Brisbane.

[00:26:07] So when we were building this one in 2018, I actually engaged a buyer's agent to find us an investment property in Brisbane. And they did actually a really good job because they managed to find that property that had a bit of a structural damage, but we used that as an opportunity to negotiate the price, and we managed to negotiate $50,000 off that, which was a really good result. And again, it was an original house built in the '80s and needed a bit of a renovation, but not really massive. We didn't replace kitchens or anything like it, just painted the cabinets and benchtops, just really refreshed it. And we basically retiled the entire bathroom. And that was it. 

[00:26:58] That was a good opportunity for someone who wanted to live or rent the property to basically pay a little bit more because it was already refreshed and relatively new. And when we compared with the other properties in the area, and most of them were like, original condition. 

 

[00:27:14] And the other good point about that property was a big shed. It had a six by 12 metre, 72 square metre shed. The previous owner used it for a home business, like an auto repair business. So it's relatively tall too. And we knew that that would be a good selling point. So when we were actually renovating, some of the neighbours approached us, like, 'Could we rent this shed from you?' and things like that. 'Okay, we'll see how we go, if we find a tenant that doesn't need it, yeah, more than happy.' 

[00:27:48] However the people we found, they actually moved from Darwin. And they had a lot of stuff with them, like boats and camper trailers and things like that. So for them it was just perfect. And they still live there, because they've got a lot of stuff. So that was another property, which we still have. And this one's positively cash flow, which is good. So it doesn't cost us much to maintain at all. 

[00:28:13] And then another one, which is when I completely changed my mindset about property, was the one I purchased last year. And it was after attending the neons courses and seminars. So we set it up properly from day one, set up a company, and followed all the steps. And we managed to secure it reasonably cheaply through some clever negotiations. And yeah, we sold it four months later and made some good money on that one.

 

[00:28:53] This one started potentially as a development site, because it was zoned as a medium density, so up to five storeys. However, the block was a little bit smaller, I think in Brisbane it has to be minimum 800 square metres, and this property was 772 from memory. So we're a few metres short. But when we basically signed the contract, and during the settlement period, I already started looking for developers. Like, okay, well, would you be interested in building something big, etc. 

And then COVID-19 came along and threw a spanner in the works.

[00:29:36] But after Brisbane went into lockdown, that was it. Phones just stopped calling, at all. So quick, had to find a way, okay, what do we do about this property? We knew okay, some money spent, it's still pretty good. So we have to find our exit strategies, and we actually decided to renovate it. Because initially we thought that property had to be demolished. There was a bit of a structural damage and termite damage, which we couldn't really inspect much at the time because the property was going to auction anyway. And they were happy to accept our offer on the basis that it's basically auction conditions. So no building, pest, finance and all the other things. 

[00:30:19] But as we realised later, after we removed the asbestos sheeting, etc, that the damage actually wasn't that bad, and the house was still repairable. Which we did. And when we basically did the reno reasonably cheap, we realised we didn't have to do bathrooms, they were pretty good. They just had to be cleaned up. And we replaced the kitchen, however we managed to find a secondhand one, reasonably cheaply. And we decided to put it on the market, see what happens. And that was around May last year. So after five weeks, the property went under contract for over $100,000 profits. 

 

[00:31:21] We were thinking of potentially maybe extending the existing house and convert it to, like, a room and accommodation to get better yield. Because the property was in a really good location, like very close to local shops and trains, etc. So we knew that there would definitely demand for tenants, but we wanted to get a better yield. So we looked at an option of maybe extending it, adding an extra two bedrooms or something like that. And the house was a Queenslander. So they are relatively easy to convert or extend. 

[00:31:54] However, the cost was reasonably high. So when I did the fees on that it just didn't really stack up. Because we were a little bit too close to the rail line. And the amount of acoustic treatment required was just making it too expensive and not really worth it. So we took a risk and said, 'Well, let's just renovate it as it is. Just do it really cosmetically, don't spend too much money and we’ll see what happens. If we don't sell it we'll just get the tenant in and we'll see how we go later.' With property right now we would have probably made even better money. 

[00:32:52] Especially the early predictions were, like, 30 [or] 40% drop in prices. So when you see things like that, we were really concerned.

Premek Borek’s story continues in the next episode of Property Investory. We’ll further discuss the changes COVID-19 has brought into the property market...

 

[00:02:21] As probably many people know, they actually stopped advertising the prices, it was just 'For sale.' Because even agents couldn't put a price against it. They just let it run its way and see who's going to pay the most. 

 

He lets us in on his psychological secrets to success...

 

[00:04:22] I think negotiations is probably one of those things. Once you discover what the other side wants, you've got a huge advantage. 

He shares how you can prepare for property negotiations in day-to-day scenarios.

[00:12:52] I had a period of time that I would go to a dealership and just try to get the best possible price on a car I could get. And you get, like, 10% [or] 15%. And you think they are well trained, but you apply some of those techniques, and you can definitely negotiate the prices. 

 

And that’s next time on Property Investory.