In this episode, we embark on an exhilarating journey with Bharata as he takes us through the rollercoaster ride of property investment. From the heart-pounding moment of buying his first property in the bustling city of Sydney in early 2021 to expanding his empire into the lucrative markets of Perth and Cairns, Bharata’s tale is a thrilling adventure of seizing opportunities and consequence challenges. And what is his secret weapon that has allowed him to attain such success? It’s the power of podcasts and digital resources, providing him with trust guides and strategies for this electrifying quest towards financial freedom.

Timestamps:
01:04 | Navigating the First-Time Home Buyers Maze
05:42 | Perth’s Property Boom
08:39 | Two Years, Eight Properties
09:37 | From Gaming Frustration to Property Triumph
14:12 | Mastering the Market
15:11 | Aha Moments
18:26 | Chasing Financial Independence
20:30 | Tech-Enabled Mentors
21:58 | Time, Your Greatest Resources
24:06 | Reflecting on the Past, and Plans for the Future
26:00 | The Perfect Harmony
 
Resources and Links:

[00:05:25] Basically, in property, to make it simple, you just have to have access to funding, and you need to know where to buy and what to buy. If you can combine the two properly, then you can keep multiplying. But simply that's how you create wealth. 

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 back with Richard Bharata, who by day is a project manager, and by night, a buyer’s agent. His journey has evolved from an initial property acquisition in Sydney, where he navigated legal and financial challenges, to amassing an impressive portfolio of eight properties in just two short years.

Bharata shares his experience of buying his first property in Sydney. Despite the stress involved, he highlights how his passion for attending open house auctions greatly facilitated the process. 

[00:00:06] [The] first property [that I purchased] ever was in early 2021. And that was when my wife then and I. Sorry, [I meant] my wife now; we just got married, so no longer [my] girlfriend. We bought our first house, which [is] where I'm sitting here in Padstow Heights; we bought it in early 2021. We could afford it in mid-2020, [but] 2020 [was] probably the best time to buy [property] during that COVID panic.

[00:00:35] But we ended up buying [the property] still at a good time in Sydney, early 2021. There was this house for about $1.2 million. It was a very stressful first time buying. But I did [have] experience because I like attending auctions [as] I always loved properties. 

[00:00:52] Naturally, I attend[ed] local auctions just to see how the market was going after we secured our place. And then there [was] similar property selling for like $1.3 million, you know, $1.35 [million] [and] $1.4 [million]. Just crazy. You know, [a] once-in-a-generation boom. [Even for] $1.5 [million], $1.6 [million] [and] $1.7 [million]. Like, wow, this is crazy how this [process] goes. 

[00:01:15] [A] real estate agent [was also] trying to knock on my door saying, 'Hey, I know you only bought your property recently. But we can sell it for $200 000 higher'. Like no thanks. That way [by attending these local auctions] I can see the potential in [a] property [and] that was back in 2021. 

In their quest for a place to call home, Bharata and his partner embarked on a journey through the vibrant neighborhoods of Greater Sydney. Driven by determination and insightful knowledge from a property podcast, they successfully secured their current residence. 

[00:01:43] We liked [the] Sutherland Shire to begin with. But you know, everything was so expensive down there. We almost bought one over there but got beaten. 

[00:01:53] Then I think Jess's cousin—long-distance cousin—lived in an area called Revesby, and then she was sharing [the property]. So they [both] were looking at Panania here and there. 

[00:02:04] Then naturally, we start[ed] looking somewhere in that area. And then this house came [up] on realestate.com, and we both liked it. We decided to inspect it on a Saturday and put an offer [in] on the same day. And by then, Jess was already listening to My Millennial Property, like those good property podcasts. And we knew we had to be quick [from the] bit of education [we learnt on that podcast]. And we secured it by Monday.

Purchasing your first home is usually a joyous occasion, but Bharata and his partner’s experience was different. They had to navigate numerous legal and financing challenges and made some risky decisions, but in the end, it all paid off. 

[00:02:52] It was [a] very stressful first time buying. We don't know how the legal [process] worked. We had a solicitor or conveyancer [that] was really slow in responding, [as] they [were] too busy. 

[00:03:04] Our broker [also] missed out on [a] critical policy. NAB couldn't lend us more than 80% [LVR] because we were buying this [property] all with our own money. So we had to go up to 90% LVR back then, but then NAB said [they could] only do 80%. I was like, oh, how are we going to get this? So, we basically signed a contract without finance approval at the time.

[00:03:30] That 10% [difference] is equivalent to $100,000.

[00:03:33] $120,000 because [the property cost] $1.2 million. We didn't have [that type of] money; she worked in the bank in Macquarie. So we did in-house internal, [which was] very rushed and a lot of stress. [It was a] very difficult time, but then my broker also tried to find another solution, which they did. So we ended up signing with ING and got it to 90%. I think we paid like $30,000 LMI because we didn't know better.

[00:04:04] But sometimes you need to get it over [the] line in order to own that property or the asset. You have to actually sometimes take that extra insurance so that way you can get it. Otherwise, you lose out, and if you had lost out, you would have lost a couple of $100,000 anyway from the appreciation. 

[00:04:17] Absolutely. Yeah, with the opportunity cost. But maybe we could have gone with 88% LVR instead of 90[%], or they would have reduced the LMI significantly. Anyway, that's okay. We got it just one day before the cooling-off period.

[00:04:32] Wow.

[00:04:32] And [now] we are all happy.

After the excitement of their first property purchase, Bharata began exploring the market again. Through tempting opportunities that arose in Brisbane, nothing materialised. However, armed with fresh insights gained from property courses and podcasts, Bharata embarked on a new venture in the Perth market.  

[00:04:42] When I saw how property prices went up, we all say it's [the] benefit of hindsight. I was already ready to buy again in mid-2021. You know, like [I] could have picked up in [the] Brisbane [property] market at the time—May 2021 [to] late 2021. But we [instead] were buying furniture, TVs, fridges [which] easily cost us $20 000 [to] $30 000. They were very important for us to enjoy our place.

[00:05:15] But we didn't buy in 2021. We did, [however], buy our first one in 2022. 

[00:05:21] Yep. 

[00:05:22] So I was not using a buyer's agent; I was considering using a buyer's agent. Because for me, it's easy. Basically, in property, to make it simple, you just have to have access to funding. And you need to know where to buy and what to buy. If you can combine the two properly, then you can keep multiplying. But simply, that's how you create wealth. 

[00:05:49] I knew the concept. I have access to funding, but I didn't know how to buy, and that's when I was considering a buyer's agent. But I ended up doing a course [with] PK [Peter Kelaher], [who] I think [has] been on your podcast. And then, obviously from there, I took some other courses as well, but no one I [can] give a shout-out to because his was really good. And basically, I bought my first one in February 2022 in Perth. 

[00:06:17] Excellent. 

[00:06:18] So that was the first one.

[00:06:20] And did you fly back to Perth at that point in time?

[00:06:23] No, no. 

[00:06:23] No, you didn't, okay. 

[00:06:28] But we did have people inspect our place, and we have friends as well [who] live there.

Bharata explores the reasons that led to his interest in purchasing the property in Perth. 

[00:06:45] Well, it's all in the data. And you know, and I am someone who always challenges [ideas]. Even though I did take the course, I did try to cross-check with other professionals, you know, [and] just trying to do some kind of expert validation there. 

[00:06:59] Perth was basically a very hot market already back then, even in early 2022. So we bought a place in the city of Kwinana, [in a] suburb called Leda. We bought it for $381,000 back then—four bedrooms, two bathrooms. And there's such a short[age] of supplies, even now, if you go on real estate [websites], there's only three properties for sale, and they're all under offer. And [now] they are already asking [for] $500,000 plus.

After his success in Perth, Bharata has continued to expand his property portfolio, including his recent property acquisitions in Cairns. His portfolio has reached an impressive state, highlighting the remarkable growth potential within it. 

[00:07:48] Since February, we bought our first [property] and then we bought our second one in Cairns. And that was in April 2023, so about two months after. We bought in Cairns, [and that was] probably not my best purchase, to be honest, because I slightly overpaid on that one. But it still grew regardless till now. We bought it for $465,000—corner block, mountain backdrop. So [it's a] really, really nice property— four bedrooms, two bathrooms. Yeah, that was in Cairns.

[00:08:21] Okay. Well, I'm just curious how many properties total that you currently have in your portfolio at the moment, then?

[00:08:27] Yeah, so including the place we live in, there are eight now. There is [also] one that is settling in two weeks, actually.

In a revealing conversation, Bharata opens up about a pivotal turning point in his life. He shares how he fell into the addictive world of online gaming, spending thousands of dollars and wasting countless hours. This experience served as a catalyst for him to reassess his choices and embark on a journey to turn his life around.  

[00:08:54] You know how I told you, and you know, this Property Investory, a story is always good. So, you know how I told you [that] I saw a pattern of how I was so lazy back in high school, and then, only later, I realized it's like a slap on the face. And then I bounced back really quickly and did really well. 

[00:09:14] I see that's repeating again here. To be honest, I haven't really shared this publicly. I was wasting so much [of my] money in my mid-20s when I was earning reasonably well for my age back then. I wasn't investing; I was trapped in this online game. It's a pay-to-win game on your mobile phone, and I easily spent almost, maybe even $50,000 in two years.

[00:09:40] That's online gaming for you. 

[00:09:43] Online gaming, yeah, it's like an addiction, it's crazy. And not just money, but [it impacts] your time as well. So it came to a point where, after my honeymoon, I realized. I actually looked back in the log and then [saw] month-by-month how much I spent; I created a histogram [chart]. In January [and] February, you can see a pattern. It started with like a few $100, not even $100, and then more, then a few $100, and then like $1,000 [to] $2,000 a month, and then like $4,000 or $5,000 until like $6,000 [to] $7,000 a month. 

[00:09:47] Then I realized what have I done [with] my life. That's like a slap in the face. And then that's why I'm bouncing really quickly now. And I know I'm doing really well now. You know. So anyway, that's why I'm going aggressive [with my property purchases].

[00:10:29] Yeah, thank you for sharing that. I really appreciate it. And it's [a] really good story to share with the audience. Because it goes to show that anyone can make the change as long as you realize what isn't, you know, healthy, I guess, in that sense, because some people don't mind online gaming, I don't mind it, you know, it's as long as you're not going crazy with that, and especially when it might not be adding value. It may add value to other people's lives, but maybe not you.

[00:11:00] It certainly taught me a lesson.

[00:11:02] That's a big lesson. 

[00:11:03] I was actually going to ask you, what's one of your worst investing moments? Obviously, it's not really investing, but it's one of your worst moments in life. Would you say that's sort of your turning point? 

[00:11:13] You know, what's funny? With that game, people won't call it [an] investment, but in the game, like they have this monthly discount, 'Spend $200, and you get a value of $500 of value; best investment ever'. That's how, like, they advertise it. And then you [end up] spending $2,000, you know, just like that. 

[00:11:38] And then at one point, I tried to sell the account because it's a grinding game. But with that kind of strength in the account, I could have sold it for an easy $5,000 or maybe $4,000; people would buy it. But I was stupid. I used [my] personal email in that account. So I couldn't sell it. I couldn't sell my personal email because it's got a lot of my personal information. So yeah, it's probably the worst investment.

Coming up after the break, we’ll explore the fascinating mindset and attitude that propelled Richard Bharata on his path to building a thriving property portfolio …  

[00:14:41] Money is just a number in your bank account. You know, they can just in the next day send you 100k just like that, and then all of a sudden you can use that number to forge to buy another asset just like that.

His strategic roadmap to make his apsiration of attaining financial freedom a reality … 

[00:17:06] We want to reach that financial freedom, independence as soon as possible. The first milestone for me is to be able to retire my wife. 

The importance of him fulfilling a purpose driven life beyond his career and financial success and ensuring to leave a positive mark on the world … 

[00:27:32] Because you only live once you don't want to just live [and] work, because you have to, you want to make a tremendous impact in someone's life. 

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

Bharata discusses his positive experiences in his property journey, highlighting how all of his properties, including his most recent purchase, have experienced substantial growth. This highlights his astute strategy of entering the market at the right time and buying properties at favorable market values. 

[00:12:18] It's all been positive to date, nothing really negative. All [the] properties grew really substantially, even for the last one and a half years. We bought seven [properties] in the last one and a half years, [and] they all grew at least $50,000. Even the one that we just purchased because we bought it so well. The [cost of the] last one was $517,000, but literally, next doors [price] was $690,000 [and] sold a few months back. Even the bank valuation came [in] higher, like during [the] purchase, [which] normally doesn't happen, right? 

[00:12:53] No. 

[00:12:53] Yeah, it's like $8,000 higher with a major bank. So yeah, it's all been positive Tyrone.

Bharata’s most enlightening ‘aha moment’ was a revelation about the opportunities that the financial system provides. He shared this insight through the entertaining story of his sixth property purchase, where he seized a remarkable opportunity. 

[00:13:36] We bought, for example, not the last purchase, but I think the sixth purchase, we bought it off [the] market. I was looking for a client, actually, but the client couldn't spend more than $500,000. So to me, it [was] too good to be let go, so I bought it myself. I didn't have [enough] finance back then, but my broker said just do it you'll be fine. So, I valued it at around $575,000 [to] $580,00. 

[00:13:42] Excellent. 

[00:13:43] I bought it for $512,000 off listed. And that was true three weeks later, even before settlement, two major banks—like separate banks—already valued it at $600 000. So, basically, what that means is I can refinance these banks and get $90,000 cash just like that. That is a lot, and obviously, it is not free. 

[00:14:39] But that's an aha moment to me like it's crazy how money is just a number. Money is just a number in your bank account. You know, they can just in the next day send you 100k just like that, and then all of a sudden, you can use that number to forge to buy another asset just like that. So I feel like, wow. 

[00:15:03] So, people have the mindset of scarcity; they are scared if they have like $200,000 [to] $300,000 saved in the bank, [which is] lazy money and doing nothing. But you know, that's a big opportunity they can use [the money for], but they're scared of losing their $300,000. But yeah, it's a big opportunity, to be honest.

[00:15:25] It's very interesting, because ultimately at the moment, with our financial system, I guess it's backed by quite a number of things. But it's very easy for us because of the supply and demand that we have in the market for things to sort of just shift around with numbers. And I've seen it happen a lot within the financial sector because I work in this space all the time. And some things evade certain things, and, you know, so forth, because, yeah, I'm a private financial broker. 

[00:15:52] You're a lender. Yeah, it's a very unique model there.

[00:15:55] Yes. So that's why I see it happen every single day, and it's not uncommon. But for everyone else out there, I guess that they're still looking at doing all this and learning about it. It is a very eye-opening type of industry.

[00:16:11] The velocity of money, right, like how fast it moves in and out.

[00:16:14] It's very quick. And I guess at the end of the day, all they want to know is making sure that these banks that you go to to get financing and so forth is that—Can you afford it? Can you pay it back? And can they get the money back? And if they mitigate all that risk, they're happy to throw more money at you. 

[00:16:33] Yeah, it's important [that] you know how your household budget is performing and [at] each property how much money it's taking from you so that you're not forced to sell it at one point. 

[00:16:45] Exactly. 

Bharata openly shares his ambition of achieving financial freedom and enabling his wife to retire. He aims to reach this milestone within the next five to six years, outlining a well-thought-out strategy inspired by industry experts like Simon Loo and Sam Gordon. 

[00:17:05] Goal is we want to reach that financial freedom as soon as possible. The first milestone for me is to be able to retire my wife. So we are having our firstborn soon, and we need to spend more time with them, especially my wife. She has a really good job, and she's doing really well in where she is now. But, you know, ideally, [a] full-time housewife because that's harder than working in the bank. We want another kid as well. 

[00:17:35] So that's my first milestone for me, you know, ambitiously, within the next five [to] six years, we can reach that status. But conservatively, [in] 10 to 15 years, we can definitely get there.

[00:17:50] Time flies when you have kids. 

[00:17:52] Yeah. 

[00:17:53] It just adds a little bit more extra; you are just going to have to be a bit more disciplined, I guess you could say so. 

[00:18:00] So what's the strategy then to be able to achieve those goals?

[00:18:04] Yeah, so my strategy is quite simple. [It's to] buy and hold [and] try to buy under market value. So I'm a big fan of Simon Loo, Sam Gordon, obviously, you know these guys, Arjun Paliwal. They all have their own tastes in doing things, but they all try to use data [to] buy affordable properties and get really decent rental yields, so it's not too hard to hold. Simon is very big in buying way below market value. Such an inspiration. So is Sam, right Sam Gordon? 

[00:18:34] Yes, both of them do. 

[00:18:34] It really inspires me to negotiate harder, finding those below-market value deals. [Also] look; I'm the buyer's agent. I am like killing five stones at once now because if I have four or five buyers, and if all of them pass like a property [I have brought to them], I can buy it for myself easily. So that's a strategy that we are doing.

Bharata unveils his instructive mentorship strategy, harnessing the power of podcasts and digital resources. He underscores the critical role of immersing oneself in content aligned with personal goals and aspirations, a driving force behind his motivation and accomplishments in the field of property investment. 

[00:19:27] To be honest, podcasts like yours are a big mentor already because I learned a lot from [you]. And that's how you started your podcast because you wanted to learn from these guys and then publicize it so everyone else can learn. There is a saying that you are the average of [the] five [to] 10 people [you] surround yourself [with]. If I listen to this kind of podcast like two [to] three hours a day, that's me surrounding myself with people who've done it, who have similar goals, who've done [it] successfully, and it becomes normalized in my life.  

[00:19:55] That is right. 

[00:19:57] It becomes normal. I consider that [to be] mentors—like visual digital mentors— if you call it that. So obviously, I still talk to PK [Peter Kelaher] sometimes when I want to ask [for] his opinion. He has done really well himself. And my broker, shout out to him as well, he's got $12 million [to] $13 million of properties portfolio. He's done it in [the] Sydney market, Melbourne and Canberra. But no specific mentor, where you do a regular one-on-one every week or something like that. Yeah, [I] try to learn from everyone, basically.

Bharata graciously imports straightforward advice to our listeners, emphasising the paramount importance of seizing the present moment and recognising time as the most valuable resource for accomplishing goals, particularly for those aspiring to own property themselves. 

[00:21:07] I can't remember who told me this. I don't know if I can give advice; maybe that will work [instead]. Probably start early, like start when you can; don't procrastinate. Time is one kind of resource, which, no matter how poor you are [or] how rich you are, [if you are] Bill Gates or the poorest of the poor, they all have 24 hours, we all have 24 hours in a day. 

[00:21:34] That's right. 

[00:21:35] And it's how you use that time [which] will determine the outcome and the life you'll be in. Look, some people are lucky they are born in[to] a very rich family. But there are people who aren't, but they made the best use of their time, and they've done really well. So start early, especially [with] that compounding effect of investing. So invest early. 

[00:22:00] People only live like 85 [to] 90 years [on] average, and [the] retirement age is like 60 [to] 65 [years old]. Personally, I don't want to be working until I'm 65 [years old] and then enjoy the last 20 years. I want to be in a position where I have the choice to not work if I don't want to when I'm like, I'm 30 [years old] now, maybe 35 or 40 [years old] max.

[00:22:25] Now, I still do work, even though the passive income is sufficient, but I'm doing work that I'm passionate about, [and that] I can add value and make your life more meaningful. Because you only live once. You don't want to just live [and] work because you have to. You want to make a tremendous impact in someone's life. 

[00:22:45] For sure. 

[00:22:45] That's my aspiration [and] my calling for where I want to go.

[00:22:52] Your strong why, your purpose, everything that you want to do.

[00:22:55] My strong why, yeah. Take action, start early, start now. Just do it, talk to people, calculate your risk and you will do well.

Looking back a decade ago, Bharata shares a powerful message he’d convey to his younger self and anyone seeking financial wisdom. Shaped by conversations with successful individuals like PK, his advice underscores this transformative potential of early financial education, investing readers to learn from his past mistakes. 

[00:23:30] Start now, start saving. PK, when I was interviewed in one of his YouTube channel [videos], he [told me he] started when he was 21 [years old]. And here he is, only 33 [years old], [has] $12 million, no debt, and maybe 500k passive income because he started early. But everyone has their own race. So if you're already 40 or 50 [years old], start today, [and] start educating yourself. Like, you know, everyone has their own journey. 

[00:23:58] But if I [could] go back 10 years ago, I would tell myself [to] still enjoy life. But start investing, don't play online games. Don't spend $50,000 for [a] zero return.

In the coming five years, Bharata anticipates an exhilarating journey as he envisions his property portfolio doubling in value and achieving financial freedom, enabling him and his wife to work fewer days and cherish precious moments with their family. 

[00:26:10] Look, the portfolio doubling, maybe not the Sydney one, but Perth; I have seen it double in [the last] three [to] four years. I'm sure it will outperform a lot and, hopefully, keep buying properties until we can't afford it or our cash flow doesn't allow for it. And then retire in five years. Not like retired [and] do nothing kind of thing, but I can tell myself and Jess, hey, let's work three days a week because we want to enjoy two days with our kids kind of stuff. 

[00:26:49] Yes. 

[00:26:50] So I'm very looking forward to that and I think we will get there.

[27:06] So you've achieved a lot in this short period of time. How much of your success is due to this skill, intelligence and hard work? And how much of it do you think is because of luck?

[00:27:21] I think [in regards to] my personal [success], I feel like it's the perfect Venn Diagram of those—luck, skill, intelligence and hard work. It's like everything is working in harmony. I'm very lucky. I did say my parents didn't spend a lot of time [together] when I was young, but they actually worked really hard, and I learned indirectly [that] I need to work hard. And they taught me how to save really well; not [all] parents are like that, so that became ingrained in me. 

[00:27:49] [I have a] funny story as well, my parents both; sorry, I'm getting a bit off-topic [and] off tangent here. 

[00:27:56] This is really important; it's really good.  

[00:27:58] My mum bought the land in Jindalee back in the '90s, [and] my dad bought the BMW around the same time [and] for [roughly] the same price. You can probably guess they still have both of them. I just asked her yesterday, just in preparation for this podcast, where’s the BMW by the way, [and] it's still in the backyard; no one wants to take it for free. [And] the house in Jindalee went up to $700,000, and people want to live there up in the hill. 

[00:28:25] That's an excellent example.

[00:28:26] I think I'm lucky. My mom always when she has [an] argument with dad, she always brings that story up.

[00:28:26] You can call that rich man poor dad.

[00:28:28] That's a good one, rich mom, poor dad. And it's becoming something that I always think of. You want to buy appreciating assets; don't buy very expensive cars. I can afford nice cars, but I know it's just going to go down in value. So that's me being lucky. 

[00:28:59] But then I'm [also] working [very] hard. I'm actually putting [this] into action [by] trying to buy these appreciating assets with good rentals. That's my hard work.

[00:29:07] I'm also reasonably intelligent, and [I'm] able to find an undervalued market [and] find the right growing market. And I'm [also] honing my negotiation skills as well as my research skills. So I think it's a perfect harmony of everything.

Thank you to Richard Bharata, our guest on this episode of Property Investory.