Passionate about the Great Australian Dream—buying and owning your own home—Ferris is determined to use Coposit to keep the dream alive. Sharing the goals and aim of his company, Ferris reveals the hard but fruitful journey that he undertook to create his own, successful company.

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Man. Absolutely, I think it's all about growth. It's all about the journey. And I think just learning from your experiences and tak[ing] those chances, I think that's going to be a really important lesson. And if that's the take home message, I can leave for anyone, it's just just take the changes, give it a go, you know, quit that job, you can always get back to that job if you need to, and just take that chance, like it's okay, you'll make it work.

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 Chris Ferris, the cofounder of Coposit. Continuing to share his wisdom, Ferris gives us invaluable advice on navigating current interest rates, shares his super secret strategy and champions the Great Australian Dream. And as a fun little bonus, he tells us how his company got its name! 

Continuing where we left off, Ferris’ path to success is far from complete. We’ve covered his childhood, his education and the initial plunge into property. And now, his journey is about to really kick off. As we all know, the most important thing with property investing is to turn one property into two, into three, etc. If  you’re Chris Ferris, then you can turn four into 40!

So that site that we amalgamated which was for Latino, quite large lots. Yeah, we had, we had a scheme, and we were going to get a development application approval for about 8590 apartments on that particular four box, which is why we were able to sell it for a significant gain. 

It was like, I suppose we had good connections with some agents within the area, and one of the agents approached us say[ing], ‘Hey, I've got a buyer that's missed out on about four other development sites’. And this was back in 2013/14, at the time, and she had actually missed out on quite a few different development sites, as we were getting very anxious to purchase. 

So she came to us and made an offer. And we're just like, well, we've got to accept this offer. Okay. And so we accepted that offer. And we said, ‘look, we can either develop this one in isolation, so go through, develop it, get it built, get it sold, sell it off the plan, and deliver it or we can then sell this one off, and actually lock up a few more properties and maybe develop four or five sites’. Yeah.

Next up, when he went into 40, so we locked up for some insane options, like somewhere, you know, on, I think, 48 month options at the time, but you know, if the property was worth 600, they were getting 1.2. At the time, so, you know, some insane jumps.

This is really, yeah, that is insane. I'm gonna have to ask you some questions here. Firstly, where did you learn about options? Because it's a very advanced strategy, as you know, you know, not everyone understands that concept. 

Chris Ferris:  

So the idea of options actually came from Daniel at the time where he said, ‘Look, we've got this, have you heard of optioning?’. And I said, ‘No, let me have a look into it’. And I came back to him about three days later [and] said, ‘We need to option our properties,’ because it was low. So let me explain. 

So it's extremely high risk. Let me put that out there. It's an extremely high risk option. But if you can do it, right, it makes a lot of sense. Yes. Then when we got introduced to the accountant first, who then said met my partner in the legal practice, who had done a significant amount of options for other developments as well. 

And the accountant and the lawyer, who were our partners as well, at the time, were able to give us the knowledge to say, ‘Well, this is how you do it’. Here's the structure of the agreements and whatnot. 

So we were able to, but it was Daniel and myself that were physically going out knocking on the doors, speaking to homeowners getting the options done, which, you know, looking back on that now, Daniel will say the same thing. Optioning our properties is one of the hardest things is, like, I'm not I'm knocking on your door, you do not want to sell your house. Yeah. But for me, having a no is not an answer. So I have to make it work. 

Tyrone Shum:  

Like a great real estate agent, because that's what they do day in [and] day out. 

Like they did not want to sell. So I've got I've already secured the neighbour, I've already secured the other neighbour, I need, I need the person in the middle. So for me, it's not an option to accept, no, it's about finding [a] way and you get people that you're not gonna do four or five times and they don't want it, they want to speak to you, they don't want to know you. But just for us, it's not having persistence, right? And not giving up that was one of the early lessons is not giving up. And that's how we were able to get 40 together and we're able to work on...

Tyrone Shum:  

The road by the way, or in multiple different areas? 

All different locations. So, you know, we had this big one, a two map, yeah, big huge map printed out that lived on our desk. And we would play like a life save game of Monopoly money.

You know, Oxford Street, etc. No, that would be such fun. So when did you target melee?

Chris Ferris:  

We were just in Seven Hills. So all those properties were in seven hills. So around that, that train line. So I remember George Strait Ali Street.

Chris Ferris:  

So these are the locations. So this was actually asked to develop the best road there. These are all the products that we have developed over the last eight years. And it's all because we were able to leverage off the back of first property investing experience, able to option. 

When it comes to hearing about others’ success, it can be easy to pass it off as just luck and nothing more. As Ferris discloses details on the risks he had to take to succeed, he debunks the myth of luck once and for all. 

Chris Ferris:  

And, you know, was it lucky to find that buyer to come in? Well, you know, there's a famous saying, it's funny, the harder I work, the luckier I get. Right and that is that is very much the case. You know, that was an amazing story/way for us to be able to get started. And we're able to get through an option [for] some further properties. 

But it's not always, we weren't always winning those, one out of those 40, there was a group of six properties that we are sorry, five properties that we had locked up. And, you know, we had a site of five properties, we had a site of eight properties, we had a site of temporaries. 

At a time, we went too hard, we went way too hard, too fast. And we got to a point where we had two sites, quite large sites that were looking to develop and build. But then we'd had this other settlement of these five other properties that [were] coming up. So we had optioned the properties a couple years back. 

And later, two years later, three years goes a lot faster, coming off a settlement, and we couldn't settle. We couldn't, we couldn't settle on it. So we decided to walk away from that. And there was a six figure amount that we lost on that, on those particular sites, we just lost those deposits so that the owners got to keep the properties. mucking around kept the deposits. 

Lucky. That's that's the game, right. So but it's, the net sign was obviously quite beneficial. But on that one, we lost significantly on those particular sites. But we are able to deliver in that area, we delivered close to 400 apartments in that location over an eight year period. And...

What a journey!

It was an amazing journey. It was tough. But going back to the Monopoly board, we would have a two page printed out of every single property in that location, we would, we would have outlined each property, we would have a profile on each one of those properties. 

So we would know before we even knock on those doors, we would know who that person was, when they bought the property, how much they bought the property for, we try and figure out what would motivate them. Like there was one, one guy who we knew we let we knew to leave him all the way to the very end. He was a real estate agent in the area. And we knew that if we had gone to him first, then maybe he would have tried to help America and affected us. 

So we had got everyone else mine locked away, and then went to him last. And he said, ‘Well, I'm just gonna go speak to my neighbors, and I'll get the deal done with them’. We had said, ‘Well, it's too late’. We've already got you know, say it was a full time game of Monopoly, which you're talking about my childhood. 

And I can say, Daniel and I have played 1000s and 1000s of games of monopoly, I screwed up. And one lesson that I always learned from monopoly was when I was always losing in Monopoly, right, because Daniels, the older brother, so I would lose sometimes. And, then he'd be about to win. And all of a sudden, when you're about to lose, I flipped the board, right? So when things aren't going your way you flip the board. 

So whenever someone's expecting [to] flip the ball, but that little lesson of flipping the board, it's not about throwing the game away, it's about if something isn't working for you, change it, don't just keep doing the same thing. Flip the board, what's your equivalent of flipping the board, right? 

So figure out how you can flip the board and change something that can make it work for you. And that's what we did in this scenario. And it was a great success. 

We had a 10 year partnership with our other two partners. Canon, the lawyer, has a great partnership, being able to deliver those properties and those amazing homes for people that are still living there today. And I love it. We speak to them and speak to a lot of the buyers still today.

Wow. 

Chris Ferris:  

And they love what we've delivered there. And it's been an amazing journey. 

So, it might not have been the unluckiest journey out there, but it was certainly still a challenging one! Although he has many remarkable projects to choose from, Ferris reveals one such struggle. The important takeaway? Always keep going.

I'll talk about one of the servers in Olive Street, which you probably know of Seven Hills, and that was eight blocks. So eight normal houses. I think it was 800 square metres per block. We managed 400 square metres. Yep. Yeah. So big site, amalgamate all of those properties together. We submitted a development application for 138 apartments on that. 

So you know, we turned six dwellings into 138 new homes, which I always think about. I think that's just mind boggling. Talk about density and how you deliver homes. Well, you turned six, or sorry, eight houses were eight families living and now there's 138 families or people or more people than that, but 138 families now living on those eight dwellings that were there before. 

So that's how you bring people into our location. So it took two years for us to get that approved in council and shout out [to] the back Town Council. Thanks for taking two years.

Most councils take longer sometimes. So you've done very well.

Crazy to get that. It just took so long to get that done. And you don't realise, you know, I think people look at developers and think wow, you know, there's so much money to be made here and so much time but yeah, there's there's so much risk that developers carry and there's so much time and pain that they go through to get these projects off the ground. 

So I think you need to look at both sides of the equation. To the risk and reward, there is a lot of risk and pain to get that, you know, it is a big reward. But there is a lot of pain to get to that point. And it took us about two years to get that under construction. But this was I'm talking on this one, because this was the one that settled, we had settled all the purchases in 2020. And this was in I think, August or September of 2020. So this was [the] peak COVID period as well. 

Tyrone Shum:  

Wow. So that's not long ago, then. So it's quite long-ago.

It was quite recent. And I'm picking that one because of the COVID story and settling during COVID. We had people that were just this, you didn't know if you could shake someone's hand, you didn't know if you could even be next. And we had to settle. We had to settle 138 properties. 

And that was my job to go speak to everybody to give them the confidence to say, Hey, it's okay. Don't stress. You know, you had reports from banks during the time [the] same property is gonna go down 30 or 40%. If you remember during COVID. Yeah, right through, on the way down. But people will pick a lot of money.

So just to clarify when you said you settled 130. Are you saying that that's when the apartments are finished building by that time, and you're ready to collect all everyone's life settlements, 138 settlements, all the buyers ready to go in and just hit COVID? Everyone's uncertain, because they don't even know they're probably still worth the same price. 

People are coming in. And I'm sure again, you're hearing that the media headlines that 30% drop. And as we know, property is a confidence game. So there is no confidence from people to actually settle. And we had value as of the time coming in. And they were valuing below the contract prices. So it was a crazy time. 

But we then had valuers that understood and came in and valued it correctly. Ultimately though, hurting the clients to try and settle. But thankfully we had 137 settled. We had one buyer who was an overseas buyer who we still to this day, can't locate property. 

We just had to receive them and put them back [on] the market but they're since sold. And you know, I look back now. And I think those buyers, they've probably made five or 10% Since that amount since that settlement. And you know, you just think, do some of these headlines that people follow and see, you know, even when you think about the other headline that was interest rates aren't going to go up until 2024 from the RBA themselves. 

And here we are in 2024. And I think interest rates have gone up a little bit, haven't they?

Last two years, it's gone insane. I remember it was like 3%, and then jumped [to] 7%, or whatever it is. So it's just insane. 

Right, right? Yeah, you've got to shut out the noise in property and maintain your long term view in property, the short term, the short term view is a dangerous view, you've got to maintain that long term view and that long term strategy. So why are you actually doing this? 

Because particularly if you've saved three, four or five years for that deposit Anyway, you've had a long term view to save your deposit. Why should you take a short term view with your property investment strategy, you should also take a long term view with your property investment strategy.

That's exactly right. You got to hold on to it long enough. And that's when Only time will tell because people get into it and hear these headlines and instantly go Oh, no, something's happening. So they're going to try and sell it. And then by the time that it's sold out, the markets [have] gone up again. And it's too late. So it's crazy. Some people just need to hang their motions. It's a long term game. 

Chris Ferris:  

Apartment construction is a different game, let me tell you, it's not just doing a granny phone or doing a renovation, it's a completely different game, whether it's from consultants, all the way out to the construction partners and the trades that you need to use. 

But we were fortunate as well on that project to have the accountant have to get a range of builders that he'd seen, that he'd worked with. And he'd introduced the builder who became a partner in the project as well [as] to build that and deliver that project for us, which was an amazing project. I suppose my main role in the development side of things was looking at the finance, the sales and the acquisition of the sites. 

So if I'm acquiring the sites, all the way out to getting the pre sales and the selling of the sites to the finance side of things, and working with our finance partners to get the products out of the ground, which is I take that knowledge now into what I'm doing, I posit to not only sympathise and empathise with the developers that we're working with, but that knowledge, you know, we know the pain that they're going through and what they're dealing with. 

But then we've also known on the flip side, their customers so the clients, the purchasers, we know that the pain they're going through to be able to get into the property market. So the experience dealing with property purchases was the reason how couples will be born. We had a project. I'm gonna use the street names because you know them in [the] best road in Seven Hills where we had a client who wanted to rent one of the properties. 

And he had a household income, [a] great income of 160,000 at a time. And it was a $400 per week rental and I said, Look happy to accept your rental. But you know, what are the reasons stopping him from buying what's going on. And he just said, ‘Look, every time I save, and I get to a particular point, the market either moves, and I just can't accumulate enough deposit to be able to get into the property market’. 

And then we said, ‘Okay, well, we've got a next stage coming up,’ which was the illustrated stage that I just mentioned. I said, ‘Look, why don't you read, and we'll let you buy without a deposit in this particular one, but pay us two and a half $1,000 per month’. And we'll get to the end and see how you go with the deposit. He got through, he paid two and a half 1000 for 24 months. 

So he had accumulated that 60 grand deposit that he needed. And he was able to settle, and he and his wife were able to get into the property. And he just turned around and said Celsius mate, that was the best thing that we've ever done. Because we were ready. 

So we're still living, we secured a property we were able to save for that property whilst we secured it. So you remove those moving goalposts of trying to save for a property whilst properties [are] still going up. And they were able to settle and they're still living there to this day. 

That's what spawned the idea of composite where it's like, well hold on, is there a bigger application for this? In the market? How many people are actually struggling with getting to the deposits, or whether it's a first time buyer or an investor? How many people are actually struggling with a deposit? Turns out a hell of a lot. 

Oh, yeah, I'm struggling to get the deposits to buy a property. 

Chris Ferris: 

So that was a real eye opener to [the] stock, I paused it. And then on our final stage, which was on George Street next door to polish, I say fine. Well, that was the final one. As a developer, I'm no longer we no longer developing properties. We develop, I suppose, through our clients, and we see the developments that they do.  

We tested composite out on that project when we launched it in 97 apartments there on George Street. And we opened it right up and the model had shifted a little bit where it was: you start with a $10,000 deposit, and you pay weekly payments, until you get to a full 10% deposit prior to set[ting] up. And we had a huge uptake. We had 60 out of the 97 apartments sold utilising the composite platform, which was just mind blowing for us. 

Tyrone Shum:  

[00:17:25] And that was an excellent strategy. I'll say for any developer, to be honest, if you can actually pre sell all of them using that kind of strategy, you've got yourself a development completed, basically.

Chris Ferris:  

Correct. And that's what we're seeing now with, you know, there's over 50 developers now liv[ing] on our platform, who utilise the K posit method. And this is why we've stopped developing because we're helping the clients be able to solve the number one pain point in the market, which is the deposit, you know, so often we hear affordability is the issue. 

And absolutely it is an issue. But before you can consider whether I can afford a property, you need to have the deposit first, then consider affordability. So we hope we hope with that first barrier, which is the deposit and then they help on the affordability side. 

So you know, across the country now we've got projects in Queensland, New South Wales ICT, where clients can actually now buy with $10,000, deposit any property and [be] able to save weekly to get to that full 10% deposit. So it's a game changer for not only purchases, but for developers who are able to now get their product started sooner, get the sales across the line, maintain price in their products as well. 

So that Coposit is being seen as the incentive for clients to be able to get into the property. And we're seeing a great uplift in a great take up from a lot of the clients and purchases. It's a no brainer, because it's completely free to use [to] get positive or for the purchases.

Absolutely. Let's just break it down. I like to use your example down on George Street, as you said, is it George Street that had 97 apartments that you started? Yeah. Okay. So that particular one, how did you actually implement that initially? Because firstly, you'd have to go out and find buyers, and then from those buyers, I'm assuming real estate agents to be able to, you know, market and so forth. Did they come directly to you to discuss that? Or was that sort of market as part of the campaign that you started with a sales campaign? 

Chris Ferris:  

It was marketed as part of the campaign. So we had, you know, we had a Display Suite there in seven hills as well. And then we had composite available here and people like what's composite? And they'd walk into the Display Suite. We had already educated the selling agents as to what composite is and how they can use it. And they loved it. Right. I mean, a Coposit for them is, you know, one of their sales blockers. I don't have a deposit right now.  

Tyrone Shum:  

Yeah, I can't find it. I don't know. I like that property. I can't buy it, though.

Chris Ferris:  

I love that property, but I can't buy it. So we then say, well, no, you can't buy it. Now. We're looking [at] their financial circumstances, we make sure that they can actually settle [their] completion, but we help them accumulate that deposit during the construction period, which hasn't been used before to actually accumulate a deposit to secure a property today. 

The selling agents were the primary, you know, front facing, you know, soldiers I suppose actually selling, what couples it is and the benefit of and it's and it becomes a no brainer in the selling process. You know, do you want to pay a 10% deposit? 

So for the $800,000 example, do you want to pay an $80,000 deposit? It sits in trust, nobody gets to use it for that two or three year period? Or do you want to pay 10 10,000 and pay weekly payments and cash flow yourself out? You might have 80,000. 

But you might say well, I'd rather cashflow myself out, leave that money in an offset account, for example, or have some money for living. And it becomes a no-brainer in that sales process. So [the] clip was very much a part of our sales process when selling that George apartments project. 

Tyrone Shum:  

Yeah, that makes absolute sense. So what I'm just curious [about is], as you said, this is a free platform to use for these guys. How did you make money back out of it? Because ultimately, you still have to be able to have enough profit in your composite business to be able to find that sustain and upkeep to have any overhead costs, pay staff and so forth. Where was it that you guys, because if you had a buyer coming in and putting just a 10% deposit, and they waited two years and cash flow that weekly basis, you know, it's great for them, but for you as a business with with you guys to make any any profit, especially the time and effort you put in? 

Chris Ferris:  

Yeah, look, absolutely the easiest thing for us could have been, we could have just said, look, let's charge the client or the purchaser X amount [of] fee to be able to do this. But we then said, Well, these people are trying to get on the property ladder, they may not have the deposit, we can't punish or penalise the people that are trying to get on the ladder by charging them. 

[00:21:34] And that's why one of our core principles is [that] it needs to be beneficial and free for the customer to use. So from the developer side, the developers have marketing budgets, and they have costs where they have these budgets to get their products sold. 

So we've seen as a marketing courseware developer funded and the developer pays per sale for us where it's able to develop it. So every sale that's made composite gets a fee for that sale to be done. And we disclose that to all parties because when a purchases war, it's free from your hold on a second, what's the catch? 

Yeah, and that's our hardest question to answer, what's the catch, there really is no catch. It's a free platform to use. We've just changed the process and made it a better process than what it is now. And we're develop[ing] a fund. We're similar to, you know, an IRA or a domain platform where there's project listings, you can download our app from the App Store, or the Google Play Store. 

And you can see all the products that are listed there. So there's a pay, I suppose to list onto the platform as well. And that's how we monetize the composite platform.

Having generally summarised what his company—Composit—does, I am sure many of us feel inspired to maybe start our own business! Of course, starting a business is not as simple as that. Outlining his learning process, Ferris shares how he made the jump into start-ups and tech, and shares a couple tips for us too! 

Well, that was a huge learning curve, the technology side of things, because when we were [a] couple years back when we're looking at the composite idea, or said, ‘Well, how do we best deliver this to our customers?’, so to the purchasers. 

And you immediately think, well, an app, everyone's got phones, everyone's got, you know, an app is the best way to deliver this to the customer. So we said, ‘Okay, well, we need to develop an app’. So we engaged a third party developer or app developer to build this for us. And that was an amazing process to go from. We learned a lot during that process. 

About a year and a half or two years ago. Now we bought all of that team in house. So located here in Sydney here in Summerhill. There's about seven people in that team, from engineers to product and product managers. And we've just had some amazing people in the past, you know, Wayne, who might [have] listened to this Wayne, who was a fantastic CTO who helped us build that team as well. 

And that was an amazing part where we were able to get this platform built, and whether it's the website or the app, able to get that technology side of things built but you mentioned that it's more of a technology come in and look, it absolutely is. 

But it's very, it's property is still a hand to hand combat, it's still a personalised game, you know, I remember five or six years ago, a lot of VR companies so the virtual reality companies thought that people were only going to buy property via the headset, and they'll do it from the house. 

We're still not at that point from the economic side of things. People still want to touch and feel and get that personalised service, particularly with property. I mean, it's so much it's the largest purchase generally that people will ever make. And some people only buy one if no one at all. 

Yeah, so it should be taken time to go and touch and feel and see that displacement experience so for sure, it's still a hand to hand combat business but um, we're seeing the technologies that it is very interesting to see the technology and property mix that you know, the prop tech side of things mix and we're doing a fantastic job to be able to bring that in and it's a full payment platform as well.  

So clients make all the payments by the composite app. So they are able to see that on [a] lot of time basis. So merging all of that has been an amazing experience. It's been an amazing learning curve. 

Coming up after the break, Ferris shares invaluable advice to listeners looking to buy in the current market.

Look, it's very difficult. And we're seeing, you know, first time buyers, in my view, we're going to have a tough 2024. I think with affordability and interest rates where they are, it's going to be a tough year for people trying to get onto that property ladder purely from the affordability side of things as well. 

He highlights how important it is to bounce back from losses…

And there is always a silver lining to any negative situation, no matter how bad it is, you've just got to go through it and try and find what that silver lining is. And for us that loss, the silver lining was we were able to deliver the other projects. So it was cut one off for the sake of delivering the other products or put all of them at risk. 

He reveals the most important principle he maintains to keep a successful business…

For us, you've only got one reputation. And when it's gone, it's gone. So having that trust, and building that trust, and having a solid reputation in the industry, is something that's extremely important to us. 

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

Of course, starting a business comes with even more things to learn beyond just the business and tech side of things. Thankfully, Ferris is more than happy to teach us! From the regulations and rules to the specific trust accounts, Ferris shares some information on how to get your business going.

Chris Ferris:  

Yeah, yeah. So we're licensed under the real estate licence per state as well. So Queensland, New South Wales, AACT, Victoria, we're licensed per state to be able to hold trust money. 

So all monies that we collect, go into a trust account, they go into individual accounts per client, and they're invested into term deposits, they earn interest as well, particularly now, legally, now it's becoming more important as interest rates have gone up, the interest over that two or three year period can be quite substantial for for purchases and developers to accumulate. 

So we're licensed and regulated under the trust side of things and the real estate licensing. 

And you mentioned interest rates, because as we know, you know, that the last few years as well, since COVID, right rates have been increasing insanely. How has that impacted purchases to be able to put money into these developments? Because right at the beginning, we talked about how hard it is to get the supply, but also, at the same time, how prices of properties have gone up so much. This is kind of a perfect time to talk about this topic. Because how do people afford to be able to buy properties [that] are so expensive at this point in time?

Look, it's very difficult. And we're seeing, you know, first time buyers, in my view, we're going to have a tough 2024. I think with affordability and interest rates where they are, it's going to be a tough year for people trying to get onto that property ladder purely from the affordability side of things as well. 

You know, if you earn[ed] an income of $100,000, back in 2021, or 2020, when interest rates were low, your borrowing capacity was a lot higher than what it is today. That's just that's just what it is. The difficult thing is as well, I think a lot of people think when interest rates come down, they'll be able to afford that property. 

The issue I think with that is there's going to be a lot of people in that same boat. So when interest rates come down eventually, at some point, whether it's the back half of this year, as people are saying or towards next year. That means, you know, if there were 20 people that were looking at that same property today, there's going to be 30 people that are looking at that same or even if not more, right, because they're all now now able to afford the property because it trends have gone down, which is, in turn going to push prices up.

Tyrone Shum:  

I was gonna say no, absolutely. And then that's what happened last time, because when interest rates were so low, everyone was going, yep, I can go and pick but then you attend these open houses, and you get queues and queues of people lining up 3040 50 groups going and competing. And then when you compete, this starts as a silent auction, and then prices start going up. And then that whole cycle happens again. So you know, it's not, there's not always going to be the best time to buy, but it's just gonna make a decision to buy now or later, and you just gotta wait for the time that you can afford to do it. Not you know, when the markets, right. 

That's the thing. I think when you can afford to do and, you know, not, I'm not giving financial advice by any means. But even if it's above the affordability, like really, at the time, when I bought my property at 300,000, I was earning an income of 33,000 at the time, but I knew that coupled with the rent and coupled with my income, I could, I could make it work. 

But I was always in the hole every month, it was a struggle. But I knew that if I maintain my long term plan, you know, judging, you've only got history to go by, right. So if you judge by history, you know, property is going to go up every thought saying back then every 10 years or double, I don't know if that's gonna be the case, again, but every 10 years, it doubles. 

So if you maintain your long term view with property, what you think is expensive today in 10 years won't be expensive. And that's what I think gets you by and gets you into that point. So the right time to buy is when you can afford it and just try and get in and try and block out a lot of that noise that we're seeing. And the noise continues. 

Like we're seeing the noise now, like interest rates are gonna go down this year. That's what that's the noise we're hearing. That's for the Economist. And all the experts are saying that, right. So everyone's looking at that. And I think a lot of tech people take that at face value. And I think that dangerous predictions are the most dangerous thing. 

And listening to those predictions can be difficult. I think you've just got to pick some really good mentors and people that have done it before. Hear what they've got to say. And then at the end of the day, do your own research and make your own decision as well in accordance with your strategy and know your financial position. 

Although Ferris’ confidence when talking about his journey may deceive some into thinking he had an easy journey, it has never been completely smooth sailing. He shares the worst scenario he’s faced.

Chris Ferris:  

It's been a wild property ride. I've put it on hold because of what I've gone through. And because of what we're doing here, we can pause it, you know, I actually indirectly get to live my property, dreams or journeys through our developer clients, because I can see what they're doing. 

But I can also live a lot of that property journey through our clients that are purchasing, because I can see the struggles that they're getting through. You know, that's the struggles that I went through at the same time as well. And it's great to see people get to the end of the journey. 

But I would say the worst period of point was, was losing in that option part, you know, and that was a two year period, we'd spoken with the owners, they were great owners as well, they tried to help us get to that point, and we just couldn't get there. But you know, that loss was when you talk about mindset, that loss was the best thing that happened to us at the time, it felt like the worst thing that happened, and it was dark clouds coming over. But you just need to find the silver lining.  

And there is always a silver lining to any negative situation, no matter how bad it is, you've just got to go through it and try and find what that silver lining is. And for us that loss, the silver lining was we were able to deliver the other projects. So it was cut one off for the sake of delivering the other products or put all of them at risk. 

And at the time, we didn't know that specifically. But that's exactly what it was. It sacrificed that site and lost a substantial amount of money. But it was for the benefit of the other projects to get them up and running. And it was the best thing that we did in hindsight, two or three years later. 

And even to this day, we still look back on that big loss and say, that was the best loss we ever had. And it's rare that you can look back at a loss. And say, you know, that could have led to a financial ruin or a disaster in the property side of things. 

But it taught me as well, you know, don't drop the pie while reaching for the stars, you know, so you've got to, you've got to make sure that you know, it taught me a lot about risk. It taught me a lot with investors, and the investors were happy to come for that journey, because everyone did very well out of it, of course, but that was part of the journey. 

And you know, it was the most difficult lesson to learn from a mindset perspective. At the time it was depression days, right. But we got through it and made it work for the other projects. It was a fantastic learning experience.

Tyrone Shum:  

Yeah. I'm just curious as well, this is sort of a little bit off topic, what kind of like investments would we have required in order to complete all these projects, just acclimate it like have you total up how much you've ever had to put into that, because it goes to show that you're dealing with large sums of money here.

Look at typically, you know, a site like *unintelligible*. One, for example, it was 138 apartments, you'd need, you know, from the land price, which was about 10 million all up, then you've got probably a 40 or 50 million, all on costs altogether. 

So say your whole costs on that, say 50 mil or 60 million, you don't need 60 million in cash to do that, you need a certain percentage, and usually that works out to be at the time back then it worked out to be heavier land paid off, unencumbered, so no loans, and then the finance will will do the rest. 

But depending on whether you're financing those projects with a bank or a non bank as well, that's really important. Generally, if it's with a major bank, or a banking institution, it's lower LVR. So you can borrow less. And that means you need to put more money in. 

If you've got a non-bank lender, they're generally a little bit more aggressive, maybe priced a little bit higher in terms of the interest rate, but they'll generally give you more money, so you don't need to put as much equity in. So they both have pros and cons. 

At the time we use[d] bank lenders, so it meant we had to basically have the land unencumbered. So you know, we needed circa 10-11 million into that project to get that money. So that was a combination of investor funds. And then the original funds that we had made on that sale that we had, and we had dispersed that through. 

But then as you go through and make those, get those sites delivered, and you just keep moving across to those next stages. And so it's a substantial amount of money to get in. But we also had a great story to tell with the investors. And again, it was [a] great experience, figuring out how to work with investors and keeping investors informed. 

I think that was a really important one, you know, we didn't hide anything from our investors, whether it was good or bad, we just told it straight. Whether it's a problem, whether it's good or bad. I find if you aren't straight with people, then you get into more trouble. You need to if you've got issues, you just need to tell whoever needs to be told and think you can come up with a solution together or figure it out together. So that was something that was a great lesson for us as well. 

That being upfront is the best thing that you can do. And even if it means having a very, very difficult conversation with some investors or not, you're better for it in the long run. And everyone is thankful for that in the long run. So that was about [the] great mindset side of things. 

And, you know, even to this day, if I pick up the phone and contact one of those investors that I love talking in it's you know, we always reflect on some of the great times and the bad times that we had and it's just great to be able to have that relationship after you're finished with an investment. And if we need a new project or anything new going forward, we can contact those investors again. And they're happy to work with us, that's all. That's the main thing in life.

Tyrone Shum:  

Yeah, it's those relationships. It's the trust that you've built with them. It's that communication. It's so important. And so part of that, I mean, that's the, what takes time to build the trust. And once you build a trust, and its reputation. 

Chris Ferris:  

For us, you've only got one reputation. And when it's gone, it's gone. So having that trust, and building that trust, and having a solid reputation in the industry, is something that's extremely important to us. Absolutely.

Tyrone Shum: 

So let's take a step back and say, okay, if you met yourself, say 10 years ago, what do you think you would have said to this young Chris?

Chris Ferris:  

Well, that's an interesting one. I would, again, I talk on the losses, I'd say savour the losses, you know, like, it's, it may feel very difficult at times, savour the losses, don't dismiss it, don't put it to the side, don't bury those feelings, the loss should be there to drive you forward. 

I think, you know, if you if you have a difficult time, whether or not financial loss, even if you have a difficult time in life, just know that that's part of the process, it's part of the journey, and you, you're going through that for a reason, there's someone there that wants you to go through that for a particular reason, you're going to come out stronger, at the end of it. 

And don't be afraid to take risks, I think, you know, risks are part of a part of life, you don't want to get to 60, or 70, or 80. And even think, geez, I wish I did that. I can actually say to this day, I still don't have any. I wish I did that. Moments, I've [had] every opportunity that I've had, I've tried to go for it and try to make it work and try to have success in those opportunities, whether they worked or not. 

But I think you've just got to understand the risks and know when something is not a good opportunity and put that aside. But then know when something is a good opportunity, but it has a bit of risk attached to it. And it could make you feel a bit uncomfortable. But just go for it and know that that uncomfortable feeling is growth, and that's going to push you forward. 

Tyrone Shum:  

For sure. I love that I resonate with that. Because sometimes of the pain that you gain, there's actually a lot of wonderful things that can happen. And you don't know until it happens later on. That's the thing. And that actually helps you become a better person, change and grow etc. So I totally resonate with what you just said there. 

Man. Absolutely, I think it's all about growth. It's all about the journey. And I think just learning from your experiences and tak[ing] those chances, I think that's going to be a really important lesson. And if that's the take home message, I can leave for anyone, it's just just take the changes, give it a go, you know, quit that job, you can always get back to that job if you need to, and just take that chance, like it's okay, you'll make it work.

Totally, totally. Let's look at the future. Composit is obviously now your full time main role. You know, at this point in time, you've obviously had a really great run in property development. And I'm sure that one day you want to go back into it, maybe. But what do you see or are excited about that journey in the next five years?

Chris Ferris:  

Look, I'm really excited that I mean composite to me getting composite out of the ground, I call it, which is similar to a development, you know, you talk to my experience about building an app, it's very similar to building a building, it takes time and a process. But my experience in composite and where we want to go is there's been a huge journey to get us to this point. 

Today, it's probably taken us two or three years to not only build a platform and get an MVP, minimum viable product, get market recognition, but to get active discussions with the banks, which have taken 1218 months. And we've now as of the end of last year, we've now got a top four Bank, which is loving the composite platform. 

And there's multiple banks that are loving the composite platform, but this particular bank has said, we want to make a deposit as part of our process. And that's been and they're seeing it as an opportunity to help Australians get into property. And, probably from the social impact side of things. 

[00:38:56] So I think for us, this is the beginning of the composite journey, and the beginning of being able to change the game for people to say, you know, saving for that 10% deposit, then buying a property, you don't need to do that anymore. We've now changed the process for you to say, you can now save whilst you've bought the property, I think that's a game changer. 

Tyrone Shum:  

Absolutely. 

Chris Ferris:  

It's not done in [the] market yet. On a holistic basis, we're amalgamating the whole market to do that. And I see, you know, [a] really big market where all developers are listing on the composite platform Australians are buying with the composite platform, they're loving the fact that they can now get into property with just a 10k deposit. So we've levelled the playing field for everybody. 

For most, if not all of us, we dream of owning a home. Unfortunately, as the years go by and the interest goes up, this dream feels more and more like an impossibility. For Ferris, Composit is the answer.

Whether you've got 500 grand in savings, or 30 grand in savings, but have a good income. You can now get onto the property ladder. And I think that my concern is the Greatest Australian Dream. Is it dead? I mean, I talked to one of our staff members [who] joined us about six months ago, he's 21 years old, and I said, ‘Do you know what the greatest running dream is?’ And he didn't know what it was. 

It didn't know that the greatest strategy was owning property and I think it's because it's dying. And I think homeownership is one of the most important things to create long term generational retirement wealth as well. So owning property is really, really important. So keeping that Great Australian Dream alive is something that sits really close to my heart and making sure that people can buy property. 

I mean, I've got four kids myself. And I think, well, if they How the hell are they going to get into property? If one, let's say I don't help and I don't give a guarantor loan, if that's still around in 20 years time or 10 years time? How are they going to be able to get onto the property ladder? But the answer is there is no chance that that's the answer. 

There's going to be a generation of people that just read, and there's nothing wrong with renting. But I do believe that having homeownership is an extremely important part. So making sure that we keep the homeownership dreams alive and let's get the greatest range dream back up and running. Look, that's still a thing, guys. It's not dead. Let's get it back up and running. And you can now buy property. 

And the message is Composit can help you achieve those homeownership aspirations and dreams. Amazing. 

Tyrone Shum:  

I love it. Love it. The thing is this, yeah, you've done so much. I don't know where to start. Well, let's take a look at this is, Chris, you've achieved so much great success. How much of this success do you think has been due to skill, intelligence, hard work? And how much of it do you think is luck? 

Chris Ferris:  

Made? I wouldn't say I'm the smartest guy out there, I really wouldn't. I wouldn't. I don't like the term luck, I believe you make your own luck. And again, that quote, the harder I work, the luckier I seem to get, I think you've just gotta put yourself in the right positions to take advantage of the opportunities. And again, if you see an idea or an opportunity, just go for it.

I mean, I was working full time at Deloitte. At the time before we then I quit the light, which was a great job, great location, great company to work for, to then quit and become self employed, not even earning an income right at the time to then say, let's do this property development thing. Let's get this up and running. Let's see if they can work and, you know, take a chance. 

And I didn't know what was going to happen at that time. I just got married as well. No kids at the time, but I just got married, and quit my job. And I remember telling my wife, ‘Hey, I'm gonna quit my job’. And we're going to do this probably double full time. And she's like, ‘okay, just go for it’. You know, you're just just giving it a crack. And I think that was probably really important. Yeah, that was really important. 

My wife, she's amazing. You know, having that support network of her always pushing me forward or being that soundboard there, in my lowest moments, you know, she's just been there to bring me back up. And I think that's a really important point. 

But, you know, just take the opportunities that are there and just don't be scared of it and just just give it a crack. That's, that's, you can't lose by giving it a go. If you fail, that's just one step closer to having success. So just get out there and give it a go. And you might succeed the first time. And that's, that's a win.

Tyrone Shum:  

So no such thing as fail[ure] if you give up.

Chris Ferris:  

There's no fail if you've never tried, right. 

Tyrone Shum:  

Exactly right. That's exactly right. Well, Chris has been a real pleasure to have me on the podcast today, if listeners want to reach out to find out a bit more about code deposit, etc. How can they find out or get in contact with you?

Chris Ferris:  

Get in contact with us where you can look us up at Composit.com.au or you can download the Composit app on the website or Google Play. Or if you want to get in contact with me directly reach out to me Chris.Ferris@coposit.com. 

We can reach out to him on LinkedIn. It's an amazing tool these days to reach out to people. I'm happy to talk to people and talk on my journey and get the message out there.

Tyrone Shum:  

Finally, Ferris shares a light-hearted anecdote on how he got his company name!

Chris Ferris:  

Mate, I have a famous story. I have a note in my phone back in 2019. It was like 2am in the morning. And I had all these different name ideas like You deposit, Code deposit, Coposit. They had a slogan for Youposit which was like the deposit is based on news. Tragic, right? That's terrible. And then copilot was on the list. 

And I just looked at Daniel and I said, ‘What do you mean by this name, Copilot?’. And it's a word that it's not in the dictionary. It means nothing. And it took us like six months to educate Google on what the hell but it's a unique word. And that was something really important that we wanted to have a unique word two syllable Coposit. 

And it's a play on the word deposit, of course, but the word CO [means] we're doing it together. We're helping you do it together. And that's really important. So you know, we're helping you save your deposit in the Coposit platform. So the Coposit and deposits so it's just one of those words that just worked out but everyone we talked to when we started building the team two years ago. 

The word Coposit just got this familiar already to it. It's got this homely feeling to it.

I love the name too. That's why when I looked at it, wow, I gotta find out how it came about. It's a great it's been a pleasure to have you on and wishing you all the best as well too with all this.

Chris Ferris:  

Pleasure is mine. Thank you very much. Thank you. 

Thank you to Chris Ferris, our guest on this episode of Property Investory.