Coming from a mining manufacturing background, Darryl Cracknell took a chance to chase his passion. Find out how he ended up where he is today and why he loves what he’s doing now in this episode of Property Investory.

Timestamps:
0.59 | From Manufacturing to Mortgage Broking
4.29 | Growing Up in Two Countries
14.14 | Leaving School at 17 Years Old to His First Property in 2007
19.00 | The Leap of Faith into the Property Profession
22.26 | Development Woes
25.06 | What the Future May Hold and Lessons Learnt

Resources and Links:

[17:23] I was leaving behind a good income, a secure job to go into an industry like mortgage broking. Took the leap of faith, but I'm glad I did.

Tyrone Shum:
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 Loan Gallery Finance mortgage broker Darryl Cracknell, who’s unique upbringing and property journey provides an insightful perspective into the risks that come with property investment and the importance of attention to detail.

Cracknell has been a mortgage broker for 8 years after starting off in manufacturing, and he shares with us how busy a day in the life of a mortgage broker can be.

[00:59] Previous to becoming a mortgage broker, I was in manufacturing and was doing that for a number of years, basically straight out of high school, doing that for about 15 years. I guess the path that I went on was, as in manufacturing, I started, purchased my first property in that role in that job and an investment as well. And I guess just the experience I had during that period sort of led me towards wanting to know more about the property, the property industry, the property market, how that all works. So I guess it piqued an interest, it made me realise that I had some interest in this actual industry. And here I am today.

[2:12] Every morning, after I drop off the kids to school and get them ready, I obviously just go through all the files that I'm working on. I'm preparing, responding to emails, calling new leads, new prospects, obviously calling existing customers as well that we're working on applications for and with, preparing applications to submit to banks, obviously, there's communications with lenders as well, you need to communicate with them as you're working towards obtaining an approval for your customer. So, there's a lot of emails, a lot of communications, appointments as well with customers. So it's a pretty full day. It's not a typical nine to five job, that's for sure. So you've got to be flexible, you've got to be able to, I guess have a part of your life, to be to be quite honest, from sunrise to sunset.

[3:35] Normally, I'm home by dinnertime and I'll have dinner with the family and I've got a couple of young boys, so I'll spend some good time with them after dinner. And once they're off to bed, it's generally the best time to catch up on some work, sort of around that 8-9pm afterwards time, the phone does tend to stop ringing so there's less distractions.

Growing up in the Philippines, Cracknell’s experiences from a young age gave him an open-minded worldview and an inherent sense of adaptability. 

[4:29] I was born here in Australia in Melbourne, Pascoe Vale pretty much but at a very young age, my mum's from the Philippines, so we moved over to the Philippines and I actually grew up and started schooling there. And then we came back to Australia when I was probably in grade three or four as a young child. So English wasn't great back then. But it was all good actually. Yeah, the Filipino language was my first language that I learnt. So that was quite interesting. We were sort of all over Melbourne, always been in Melbourne. From, I guess more central Melbourne to towards the end or towards the later period, towards my teenage years we were based in the western suburbs of Melbourne. And that's where I did most of my high schooling.

[5:43] It's a completely different lifestyle. And I think it helps to sort of keep an open mind to things when you do have parents of different backgrounds and different nationalities.  Growing up in the Philippines was... it's a beautiful place. I remember just going out the back and by the river, getting chased by water buffaloes, and these sorts of things. And just, it's an adventure, I'd say, it's not your typical Melbourne [upbringing] as you would experience here as a young person. So I've got to experience both.

[6:49] We probably just explored too far beyond the safe zone. I just remember all of us just running in. One of my shoes came off. And that slowed me down. And I guess that just got my heart racing even faster. It was just one of those things back then, when we were kids. It's not like it is today. You just used to go out and explore. In some sense I’m probably lucky to be alive.

Wanting to retire in the Philippines, Cracknell’s family moved there when he was young, but health complications brought him and his family back to Australia. 

[7:43] My parents built a house in Manila. Lespinasse, a smaller suburb or district was called, but it was in Manila, which is the main island of the Philippines. So yeah, I started my early schooling there, which was different. Get picked up by a bus and if you weren't behaving, you'd get a strap, that's for sure. So we had to make sure we're on our best behaviour. But it's a great experience, it's not something I look back on and think that I wish I didn't go through. I enjoyed every moment that I did, and got to experience it.

[8:33] My dad was sort of retired at that stage. So he wanted to have a beautiful life in the Philippines. Built a house there. My mum was originally from the Philippines as well. So we lived there for a few years. We got to a point though, where my dad started having heart problems. And obviously, the medical side of things overseas is not the same as what it is here in Australia. So that eventually led to us moving back here.

Even though he was born in Australia, returning to Melbourne was quite a culture shock for Cracknell. 

[10:19] It was a big change because as I mentioned earlier, my first language was actually Tagalog, the Filipino language and obviously, I'd spoken to my dad in English, but I really had that Filipino sort of slang in a lot of my pronunciations. And I guess the way I spoke wasn't proper English, so to speak. It was confronting as a, I think I might have been eight or nine years old when we moved back here. So going to a primary school, which was in Beric, at the time, where there weren't very many Asians or people of different races, it was quite challenging. I guess what stuck with me was, it didn't matter where I was, when I was in the Philippines, when I went to school there, they would call me the white guy or the American, the Yankee. And then when I came to Australia I thought I was actually coming home, coming to where I belong. But even when I arrived here, the kids were calling me [names], they weren't being too mean, but it sort of gave you the impression that you kind of don't belong anywhere. I've gotten over that now, obviously. I guess what I was touching on before is, I see it as an advantage to be able to come from those two different backgrounds and not have such a closed minded, for lack of a better term view on things to be quite honest.

[12:49] Family is a big thing for Filipinos. It's all about family, really. And with our family, we've got a huge, like this presence. We've got two sisters, here in Australia and another one in the Philippines. They have their kids as well. So, it's certainly huge for us, and particularly for my mum at the age that she's at. It's all about family and getting together during those important periods. It's absolutely huge.

Cracknell reflects on his schooling in Australia, explaining what led him down the path of manufacturing. 

[14:14] With schooling, I didn't even complete high school to be quite honest with you. So it's not that I wasn't doing well with my grades. It was just, there was no push there, no determination. I guess I was just doing school just to be in school. I wasn't really aiming for much at that point in my life, to be quite honest with you. So I was 17 when my dad passed away. And at that stage, so with me, being the youngest child, I just made the decision that I'll just go and go into the workforce at that point. So I didn't do year 12. I guess from my mum's point of view, as well. I just wanted to just give her that sort of release from pressure if there was any, from her end being a single mother at that point in time.

[15:09] But I mean, academic wise, it's not like I was doing bad. I was always good. I was always getting good marks with maths, physics, those sorts of things. I was always doing well in those classes, but I wasn't excelling or anything like that. So I left school to do an apprenticeship. That's how I guess I got into the manufacturing industry. I just got comfortable in that job. So I completed my apprenticeship, I was put in a managerial role pretty quickly after completing the apprenticeship, so I was earning a good income, six figure salary back then, which was great. And after doing a few tax returns, my accountant kept telling me that I needed to offset some of my taxes. And at the time, I didn't know what he was talking about. Obviously, he was sort of suggesting investing in property and the rest of it. And that's when I purchased my first property, probably back in 2007. 

[16:16] I purchased a small unit out in the west in Truganina. Back then, from memory, I think all that I needed to contribute was about $8,000. And I was able to buy this unit, which was my first property. So it was much easier to get into the market back then. Compare that to what first time buyers are faced with today. In manufacturing, I bought a block of land. Shortly after that, I suppose when I met my now wife. And we were looking at, hoping to obviously build our first home. And I guess some events occurred there, which didn't pan out too well, in the end. And I was getting really sort of stale. I think it may be the word in terms of my career path and where I was at. So it kind of led me to taking a bit of a leap of faith and jumping into a completely different career, which at the time was extremely scary. For sure. I was leaving behind a good, good income, a secure job to go into an industry like mortgage broking where there's no ongoing salary. From scratch, it took the leap of faith, but I'm glad I did.

Not feeling proud of his career in manufacturing after 15 years encouraged Cracknell to take this leap of faith. 

[19:00] The manufacturing was basically cast iron. So it was called a foundry. So basically, it's more we melt metal and we pour it into dyes or casts and basically produce mainly material for the mining industry, such as augers or impactors, those sorts of things. It wasn't a career that was very rewarding in terms of being able to one day tell your son, ‘Hey, this is what I did for a job’. It wasn't that kind of thing. But, as a production manager, I guess that that sort of wore me down as well,  that was the managerial position that I was in, because it didn't really matter.

[19:47] For me, it didn't really matter how well I performed or how hard I worked. It was always copping it from all angles. You were copping it from high management. You were copping it from customers if your products were late, not on time. And then you have to deal with the workers as well who are generally lazy and try to get away from doing as little as possible. It wore me down quite quickly, that role.

Coming up after the break we’ll talk more with Darryl Cracknell as we get stuck into his investment journey.

[20:54] It was something that a lot of my peers, a lot of people around me were doing. People that I work with were buying their own properties.

His key investment turning point when trying to build on a piece of land.

[22:27] So that was the tricky part and this is why I sort of enjoy what I do today, because it's closely linked to that.

The lessons he learned from the difficulties he experienced. 

[26:06] I wouldn't say putting the deposit down was the worst experience, it was probably just the delays and just not knowing. If I had the knowledge that I have now, about the property market, I probably would have taken some different steps.

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

Cracknell’s investment journey began in 2007, when he started investing as a means of reducing tax. 

[20:53] I guess it was something that a lot of my peers, a lot of people around me were doing. People that I work with were buying their own properties. At the time, I think I was still living with my sister, actually. So I didn't want to rent, I obviously wanted to buy my own place. And that was something as well as a child growing up with parents who, I guess by the time we came back from the Philippines, we were renting as well. So we were moving from all over the place from one place to another. And that was sort of something that I didn't want to do, [be in] this sort of situation. So I guess all those things led to that point.

After this first experience, he wanted to build a forever home with his wife a few years later, but that experience was not as smooth as he’d hoped. 

[22:26] So that was the tricky part and this is why I sort of enjoy what I do today, because it's closely linked to that. So we went to these new estates, where they're developing blocks of land. We sat down with a sales consultant there. And they told us obviously, about everything that's going on in the estate, what's happening. And we were excited, we were looking forward to really building our own home, we were told that the land would title so we could start building within three or four months, so it'd be ready to go. So we were over the moon. 

[23:03] But after three months, we were told that there'd be delays. And we were told that again, after six months, then after 12 months, then after 18 months, then after 24 months, there was still nothing. During that period of time, it was quite devastating. Because it felt like your whole life was on hold, you couldn't do anything. We even went to the point of asking for our deposit back by pulling out of it. Little did we know it's an unconditional contract. There's no getting out of this. So we were stuck. We were stuck in that situation. And during that period, while we were waiting, my wife happened to get pregnant. So our whole life, it just completely changed everything. And by the time the land actually titled it was sort of just like, my wife was off work. And it was sort of just like we just the, I guess the excitement was certainly long gone. We just felt deflated. And we just basically, we settled on it in the end. But we didn't end up building, we just ended up having to let it go to be honest with you, because of the circumstances that we were in at that point in time.

[24:42] We sold it for the same price. It was probably two or three years after we sold it when the price popped up. Exactly. Sometimes you learn these lessons the hard way.

After learning these lessons and working hard to rebuild back to the point of being able to invest, Cracknell is looking to the future. 

[25:06] The property that we're living in now, it's taken a while for me to be in a position to, to invest again into purchasing property, obviously. You know, with the career change, and all in there. So, we purchased our property, probably nearly two years ago now, I think. And actually one of the properties that I did have, that unit, I just just sold as well, just recently, so I guess I'm clearing the decks now. And I'm ready to actually start. I'm gonna be in the market, basically, to start my property portfolio once again. 

[26:06] I wouldn't say putting the deposit down was the worst experience, it was probably just the delays and just not knowing, the ins and outs. If I had the knowledge that I have now, about the property market, I probably would have taken some different steps. But if I held on to that land, if I did just build on it later on, then it could be a different story. It's just that there's no guidance, I guess from, from any connections with any experts in the industry. Both my parents and my wife's parents weren't really investors, they had their own property, and they paid off their own mortgage the old fashioned way: pay off your own home, and then you'll retire comfortably, that sort of thing. So there wasn't a lot of advice or guidance that we had received, but it is what it is. 

So what would he have done differently if he had the knowledge he has now? 

[27:37] On the land side of things, I'd look into the actual estimate, when they actually, when they give an estimate of titles, I should say, when they expect the land to title I'd be looking into that much more closely. I would get a conveyancer to check the contract for me before signing an unconditional contract. In no circumstances, you sort of hope that the salesperson would tell you these things, but it's not how it works, unfortunately. I guess it's just doing more due diligence, understand particularly, I mean, I wasn't a first time buyer, but for my wife, it was the first time that I was building a home. There's a lot of excitement attached to that. Obviously, it's easy to overlook these very important things and a lot of people such as us at the time aren't even aware of these important steps that you should be taking so that's probably what I would do differently, conduct more due diligence.

Throughout his unique journey, Darryl Cracknell learned a great many lessons and he applies these in mortgage broking which we will see in our next episode…

Darryl Cracknell: [1:03 transcript part 2] When I got to the point where I was just like, talking to people, as a person, rather than as a mortgage broker trying to win their business, just being real to a person. 

His time working in selling investment properties…

[3:28 transcript part 2] It was sort of a dual role, you were sort of a mortgage broker, but mainly what you're doing is you're selling investment properties to people.

Helping people achieve their own property goals…

[3:48 transcript 2] I just enjoyed the mortgage brokering side of things much more, because you just feel like you're, rather than trying to sell something to someone, you're actually on their side, and you're actually trying to help them out.

And that will be featured on a future episode of Property Investory. Thanks for listening!