Join us on this episode of Property Investory where you’ll hear her experience of begrudgingly entering the property market in her 30s, and how her perspective changed so drastically that she developed her own property mantra! You’ll also learn what she sees as the key to investing and how you need a combination of those keys to unlock your property goals, and the unique style her business applies to help clients open those doors— both metaphorical and physical!

Timestamps:
00:47 | Rolling With the Punches
05:07 | Whoops, I’m Late
07:37 | As Long As You Get There in the End
09:42 | London Calling
12:22 | Passionate About Property
16:07 | Getting the Ball Rolling
18:08 | 15 By 50
23:24 | Strategy Step 1: Reassess Your Strategy
28:04 | If Only...

 |

00:38 | Don’t Stop Me Now
04:33 | Property is a Team Sport
07:05 | Discover Your Goal, Then Make Your Plan
10:25 | Select Your Service
13:28 | Slowing Growth is Still Growth

Resources and Links:

[00:29:07] The agent was telling people it was going to be offers over $90,000 at the time. And so I thought, 'I'm in with a shot here because I've got $150,000 to spend. So I'm in with a good shot here.’ It got to the auction, it was packed, packed, and the thing sold for $155,000. 

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 Karen Young, the founder of Property Zest, a Telstra Business Award winning buyers agency. We’ll hear about how she’s all about quality over quantity, her experiences as a nurse fostering her career today, and how her parents inspired her property journey— but not in the way you’d expect!

 

 

Young is a busy mum of two who spends her days playing multiple roles, and no two days ever look the same.

Karen Young:   

[00:00:47] I do a lot of things! I exercise, I drive a lot. I analyse people's requirements and locations, I go and inspect houses, I make offers. I organise things. I organise clients, and agents and contracts. And I talk on the phone a lot, email a lot, and I manage people. So I pack a lot into every day. And it's different every day.

Tyrone Shum:   

[00:02:24] How would you describe yourself as a property investor?

Karen Young:   

[00:02:32] I'm pretty relaxed, actually, as a property investor. I think having done it for quite a number of years... initially, I was very stringent about what strategy I was doing and what I was looking for. And now I'm a lot more relaxed about it. I've realised that over time, your strategy actually evolves and changes and morphs. And a lot of that is based on where you're at in life. So what was relevant for me eight or 10 years ago is not as important now, and you have to adjust with those changes in your life. You can't do a strategy that's very time intensive or money intensive when you have young kids and you don't have time and money. So I think I'm a lot more relaxed as an investor.

[00:03:34] At the moment, I'm actually looking for a property, which we might talk about a bit later. But I'm not as desperate for a deal. I can look around because I'm looking at property every day. I'm fortunate enough that I will stumble across an amazing deal. And I'm in a position now where I can just grab it if I wanted to. It's a nice position to be in.

Tyrone Shum:  

She grew up in the northern suburbs of Melbourne, and moved around Melbourne in her early adulthood before living overseas.

Karen Young:   

[00:04:05] I lived in London for about four years. And then I came back to Australia. So essentially I'm from Melbourne but now I'm a Queenslander through and through because there's no way I'm going back to that cold!

 

[00:04:35] Look, it's a great place. I love Melbourne. I wish I could just transfer Queensland weather to it. 

Tyrone Shum:  

She got into property somewhat begrudgingly, and it took her a while to warm up to the idea of investing.

Karen Young:   

[00:05:07] I've always kind of liked property. But to be honest with you, I was just doing what people do. I was living life. I was travelling, and I worked and did bits and pieces. And I didn't really seriously think about investing in property till quite late, until I was sort of about to turn 30, I think, and suddenly decided I need something in life, a future type thing. 

[00:05:29] But up until that point, I really hadn't given it a lot of thought. And I think now a lot of times when you ask people advice, they say, what's the one thing you wish you could change? And it's ‘I wish I had started earlier.’ And I'm no different, I wish I had started earlier. But alas, as long as you wake up at some point and start doing something at some point, that's the main thing, really. I really wasn't that into it until I was probably about 30. 

[00:05:56] And realistically, I came back from living overseas, and I realised I'd been spending money and travelling and doing all those great things, but then I realised it was time to really get started, to think about something for the future, and buy something on my own. So I did, I bought a little flat in Melbourne. It was a one bedroom flat in Carnegie, actually. And I did all the mistakes, and I paid too much money for it. And I listened to what the agent told me to offer on it and what they said and did all of that. But even then I sort of bought that and sat on it for a bit. And I didn't really do much seriously, I just bought this and I sat on it. And I still wasn't really that into it. 

[00:06:38] And it wasn't until I had kids a little bit later, that I then really started to learn and understand and realise that I needed to start setting some goals and start working towards something. I just bought something early on because I felt like that was the thing you did when you were about 30, you bought a house or a flat or something. But then it wasn't two years later that I actually went, 'No, hang on a minute, I need to be planning for the future here.’

Tyrone Shum:  

Young’s parents were the driving factor in her getting involved in and understanding property, but not in the way you’d think.

Karen Young:   

[00:07:37] They weren't property investors, they worked their whole lives to pay off the mortgage on the one house. They actually split up, they're both retired and they live on a pension, they don't have investments. 

[00:07:55] And it was really seeing them work hard their whole lives to really end their working lives with not much to show for it, other than this one house that they paid off and then had to split between them. So that did inspire me to actually go, 'Well, that's not what I want to do. I don't want to work my whole life to pay off a property, and then really have nothing much at the end and then end up on a pension trying to be supported by the government'. The pension is not a lot of money. And that was the inspiration for me really getting into it. So like I said, they were inspiring, but perhaps not in the way you thought. 

[00:08:53] I don't think it matters where your inspiration comes from, either. I didn't come from an affluent family. But that inspiration still came from there. And I've got a friend of mine, Claire, and she was on our show, actually really early in the piece. And I've also had her dad on the show. And it was funny because when she grew up, her mom and dad, they invested, they bought about 10 properties all around Mount Waverley, Glen Waverley, in Victoria, which is really expensive now. And she was inspired to invest in property from her parents investing. But essentially, as long as you get there in the end, it doesn't matter where you take that inspiration from.

Tyrone Shum:   

[00:09:42] Prior to starting investing in property and before becoming a properties agent, what previous jobs did you have as well?

Karen Young:   

[00:09:49] I've had lots of jobs actually! I sort of have done 10 years stints at different careers. So the first thing I did out of university— I actually studied nursing— and I worked as a nurse, I was an intensive care nurse for about 10 years. I worked overseas as a nurse in London and then also in some of the major hospitals in Melbourne. And that was an amazing time. I loved the technology of it to be honest with you, in intensive care, and I loved all the machines that went beep. And understanding all the physiology of peoples' bodies and the way that you could manipulate inspiratory pressure on a ventilator. And it would change this physiology over here and things like that. So that was really cool. And I did that for about 10 years. And I did some postgraduate study in that as well. 

[00:10:37] And then after that, I actually liked those machines that went beep so much that I decided to do a grad dip in Information Technology. And then actually went on and did a Master's in Information Technology. So I then worked in IT for about 10 years and actually took that knowledge I had from the clinical sort of side of things and worked in clinical and medical IT related fields. So I'd write software specifications for clinical information systems and things like that. So that was really interesting. I did that for about 10 years as well. 

  

[00:11:13] And then I really felt that I wanted to do something that I was really passionate about, and property was my hobby and my passion. And at that point, I'd already started the podcast, Everyday Property Investing. And so I was doing that and I wanted to make a way that I could turn property, my passion, into what I was doing every day. And so I looked at different property related occupations. And in the end, I thought a buyer's agent would be the right thing for me. I'm a very analytical person. And I like the analysis side of property. And so that was a really good fit. And that's when I started the business. And that's been going great guns, we've been buyer's agent of the year for the last two years, we've been a finalist again this year, we've won Telstra Business Awards and things like this. So it's been a really, really good ride. Still loving it.

She took her IT knowledge and applied it to her property agency, showing just how transferable every skill can be.

Karen Young:   

[00:12:22] Our agency is a paperless agency, and I don't know that there's any other one like that. We use all of these amazing IT systems. Everything you do leads you to somewhere else, in my view. And so all of that IT knowledge, there's no way I could have set up and made this business what it is if I didn't have that knowledge. Yes, you could make a successful business without having IT knowledge, you can bring in that knowledge. But for me, we were in a position where we had to start it with very little capital, and really get all the marketing and all that. 

  

[00:12:53] So I made the website, I did all the videos, and all this sort of stuff, all the marketing, I had the knowledge to do all that stuff. So everything that you do sort of leads you somewhere. Although it is funny, though, a lot of clients, or potential clients will say,  'What qualifications do you have?' And the funny thing is, as a buyer's agent it's very little qualifications that you actually require to work as a buyer's agent. So when they say what qualifications do you have, I give them a list of all of these Bachelors and Masters and this and that, and they're all not property related at all! But realistically, you need a Certificate 4 in Real Estate to be a real estate agent. So sometimes life experiences and those experiences are more important.

Tyrone Shum:  

She divulges the secret to her organisation and how you can do the same.

Karen Young:   

[00:14:12] I'll give you one basic one, this is a really simple thing. But to me, it is absolutely vital. And I use this not just for the business and the buyers agency. I use it for projects. So if you're doing a property related project, you're deciding that you're gonna make your next purchase, I use a project management system called Asana. And Asana just organises my life. I organise my life in Asana. If it's in Asana it will get done. And it also helps me to unload the things that are all in my head, so that when I have time off, I can relax because I know I don't have to remember all these things that have to be done. They're in Asana. So to me, I think Asana is an amazing tool that you can use. It's basically you write to-do lists, essentially. A project management system is essentially a bunch of to-do lists to do with the project. 

[00:15:02] So if you've got a project, for example, your next property purchase, you can put that in Asana and go, 'Okay, what's the next steps I need to do to make this happen?' And then when you put it in there, and you put a date next to it, and it's sending you an email to remind you needed to do it, they're the things that push you forward and make you do things. So I think so many people say, 'Oh, you know, I wish I had have invested, I've been looking to invest but I just get busy', and all that sort of stuff. If you don't write it down and make it a task in your life, then often it just gets pushed to the side because we're all busy. So Asana is an awesome tool for everyone.

Tyrone Shum:  

After she bought her first property, she didn’t do anything with it until years later.

Karen Young:   

[00:16:07] I just bought it and I actually lived in it. I got a first home owner grant and I lived in it. It was just a tiny little one bedroom flat. And then a few years later, and I actually had a partner, I had a baby on the way, and we thought, ‘We need a family home.’ So we decided to sell that property. 

 

[00:16:25] I hadn't made massive capital growth, but it had some. But it was enough that it leveraged us into a family home. So we bought a family home. And I actually still own that house, in Melbourne, it's a rental property now. But we bought that house, and after we had the baby I really started to get involved in educat[ing] myself. I went to a lot of seminars and I did a lot of reading. I read magazines, I read books, there was a couple of books I really liked. Margaret Lomas' book really resonated with me at the time, I think it was How to Create an Income For Life. I think even one of the Steve McKnight ones, I think it was how to go from zero to a million properties or whatever it is in two minutes. But at the time those books really resonated with me, and the other one that I really liked was Robert Kiyosaki, Cashflow Quadrant. Rich Dad, Poor Dad is a favourite everyone's, but I reckon Cashflow Quadrant is the best. So those were sort of inspiring books, and I learnt lots and lots. 

[00:17:29] That was when we actually went, 'Okay, now we're going to consciously invest in property.’ And we actually went and joined an investing group at the time, and that was really good because we surrounded ourselves with like minded people, and people who knew stuff about how to do it. And then we actually made an investment property purchase. 

[00:17:49] And when I say we made an investment property purchase, I did a massive amount of analysis. I had a spreadsheet and I put all the suburbs in Australia and narrowed them down on vacancy rates and yields and this and that, and blah, blah, blah, until I had this shortlist of property areas that fit the criteria. And then we went and bought a property. 

[00:18:08] So I actually bought a property in Melton, in Victoria, which is outskirts of Melbourne. And we bought this property that was a little bit rundown. We did just a minor spruce up on it, we put tenants in it, and that was cash flow positive from day one. And it also actually had a bit of development potential on it as well, which I didn't realise until later on. So that was interesting. So yeah, we bought that. 

[00:18:33] And then it was a matter of I really wanted to buy one a year type thing. I had this goal in my head that 15 by 50 was my mantra, I wanted 15 properties by the time I was 50. And that was my mantra. And nowadays, like as I said, I'm a bit more relaxed these days. And I realised that it's not about the number— you don't need 15 properties, and it's not about how many properties you have at all. It's actually the quality of properties or what you do and depends on the strategy you're using. Two really well placed properties with great capital gain could set you up for life, the same way that 15 properties could with a different strategy. 

[00:19:11] I'm one of these one size doesn't fit all types. There's many ways to skin a cat investor I call it. So I think there's many ways to make money out of property. And so we then started buying roughly about a property a year. We looked at different strategies. So we looked at renovation, and we did a buy, renovate, subdivide, sell down in Traralgon, which is regional Victoria. In that house in Melton, I went to a development seminar and I learnt about development. One of the first things they said was, look at the properties you already have. And I thought, 'Hey, yeah!' So I looked at one and I thought, 'You know what, we've got that property there on a corner block with a big backyard. Why don't we see what we can do there?' 

[00:19:10] So sure enough, we could actually build a three bedroom townhouse on the back of it. We didn't build it, mind you, but we did go down the process of getting all the approvals and everything and then we onsold with the approvals. I don't think it was massive profit in it to be honest with you, because I don't know why people would give you an approval to build a three bedroom townhouse on the back of a 450 square metre block. Like, that's tiny.

  

[00:20:28] These are all part of the learning. And so yeah, in the end, we ended up with... I think we had about five or six down in Melbourne, before we moved up to Queensland. Obviously we were starting a business, and so we decided to sell down a few to raise capital for the business. So we sold a few off down there, we kept a few. And since we've been up here, we've also bought our own place of residence. And that's actually had really significant capital growth in it, which has been great. 

 

[00:21:01] I've always believed when you're buying your own home— that's a good tip— you need to think of it as an investor because it's a massive investment. And you can make significant wealth off your family home if you choose right. So we chose pretty well, I think, and we've got some good gains in that. We've bought property in our self managed Super fund up here as well. We've still got some property in Melbourne and got some property up here in Queensland, in Brisbane as well. So that's it in a nutshell!

Tyrone Shum:    

[00:21:28] That is very, very interesting. And how many properties do you currently have in total?

Karen Young:   

[00:21:34] We've got two on a block of land in Melbourne, we've got two up here, and we're just looking for another one.

  

[00:21:50] It's really important for people to have a goal. And we had that mantra, 15 by 15. I don't really subscribe to that anymore. To me, it's all about what you do and what your strategy is and stuff like that. So at the moment, I'm looking for a property now that has development potential to put townhouses on it. So there's a variety of things you can do. But I guess one of my tips is don't get hung up on the numbers of things. At one point we had, like I said, I think we had six or seven. But realistically, the bank owned a lot of that. And they were in sort of lower budget areas in some of them, where the capital growth wasn't massive. So one well-placed property with a lot of equity in it is worth more than 10 that the bank owns 90% of. So you've got to have a think about that. Don't get too hung up on the numbers of it.

Tyrone Shum:  

Young uses what she calls a morphing strategy, as she applies new criteria to check off the more she learns.

Karen Young:   

[00:23:24] With every purchase I make, I actually re-evaluate: What is the point of this purchase? What does this purchase need to do in my portfolio? And I think that's an important thing. Because earlier on, I would have said my strategy is cash flow positive property. Because that's what it was when I first started. I wanted 15 cash flow positive properties. But then as I got up to five or so I started to think, 'Hang on a minute, these are cash flow positive, but they're realistically making very small sums. And I'm going to need a truckload of these to actually retire on this. What I actually need out of this is growth.’ 

 

[00:24:03] There was a couple of them that grew really well. And I thought it was a bit of an aha moment because you leveraged off the growth to buy more. The cash flow was interesting and helpful in the fact that wasn't draining your finances, but realistically it was the growth that was leveraging me into more. So I needed to find some growth property as well. And so that's my strategy now, is to reassess my strategy for every single purchase. 

 

[00:24:28] So right now at this point in time, my last purchase was a middle ring suburb in Brisbane, it's a negatively geared property— well actually it's not because it's in my Super fund, it's actually neutrally geared— but it's a growth property. It's not one that I plan to make cash flow out of at all. It's a growth property. And obviously in a Super fund, you can't leverage off the growth, but it's my retirement plan. 

[00:24:53] My next property that I'm looking at is actually an equity creator. So I actually want to create a chunk of money out of it, or potentially cash flow, I still haven't decided on that. But either way we're going to build something, find something that we can sit on it for a few years, put townhouses on it. And then we'll either sell that off for profit, or we'll sell part off and keep the other and essentially get a free townhouse for ourselves that gives us cash flow. 

  

[00:25:19] So my strategy is funny, because it's not a strategy as such. The strategy is to reassess your strategy every single purchase. 

Tyrone Shum:  

Young’s strategy is based on her current situation and evolves based on what her needs and wants are at the time.

Karen Young:   

[00:25:52] I think that moment made me more open minded as an investor, because like I said, early on, I was like, 'It's all about cash flow, it's all about the cash flow'. And that resonated for Margaret Lomas' books and Steve McKnight's books, it was all about that. And I was always pooh-poohing all the negative gearing people. But negative gearing isn't a strategy. Negative gearing is like a tax break. That's what that is. But the strategy there is capital growth. If you're going after a negatively geared property, you're going up to capital growth, and surely you're not just chasing negative gearing for the sake of it. That doesn't make sense. And a lot of people don't understand that. 

[00:26:24] So I think that aha moment was not just that I needed a growth property, it was, 'Hang on a minute, I can't just stick with this one strategy of cash flow positive property forever, because that's just not going to pan out unless I get a whole truckload of these, and I can't see that working— I need to change and evolve.’ And that was where my mind opened to a range of different things. And that's where I am now. I'm still open to doing renovation and selling, we did a reno flip project a couple of years ago up here. I'm open to development, I'm open to still buy and hold. It just depends on what I need at that point in time.

[00:27:12] I think it's always looking at what you have in your portfolio, what you need next to take the next step. And then that's what you go for. And then you reassess again after that. I think it's just to sort of go, 'This is my strategy and I'm blindly following it without flexibility' sometimes is not successful.

 

Coming up after the break, Young reveals the people and books that have inspired her...

 

[00:01:14] I haven't really latched on to one person and think they're the Messiah or anything. I tend to look at: What am I doing at this point in time? And then who can help me with that? 

 

The way her business works and its personalised service...

 

[00:11:45] We're very collaborative. So we actually involve the client at each phase. Because I think the best person to make financial decisions for yourself is you. 

 

She shares her thoughts on the Brisbane market and which price point is moving fastest.

[00:14:25] Where Brisbane is at the moment, I think we've had significant growth for quite a while. I think we're still growing and we're still very busy on the ground. It's still multiple offer situations when you try to buy properties, it's still very competitive. 

 

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

 

 

Tyrone Shum:  

Although she tries to see the positive in every situation, Young still has a property experience that she wishes she could go back and do differently.

Karen Young:   

[00:28:04] I'm not a person who dwells on, 'Oh, gee, that was a terrible thing, then terrible purchase that happened' or whatever, I sort of take it all as learning, and then move forward. So I'm trying to think of what's the worst moment. I don't have really negative feelings toward anything to be honest. It just was what it was. And I learnt something from it. 

[00:28:26] Perhaps the thing that I look back upon with the most regret is probably when you start thinking about the things you didn't buy. So it's not the things I bought that went wrong, because like I said, I've had a few little bits and pieces, little blips, but I haven't really lost any major money. I haven't lost any money, actually, from anything. Which is one of the great things about property. I think it's the things I didn't buy, and I wish I had have that were perhaps some of the worst sort of things. I tend not to dwell on them too much. 

 

[00:28:58] The first property I ever tried to buy was a one bedroom flat in Mentone in Victoria, and it was a two minute walk down to the beach. The agent was telling people it was going to be offers over $90,000 at the time. And so I thought, 'I'm in with a shot here because I've got $150,000 to spend. So I'm in with a good shot here.’ It got to the auction, it was packed, packed, and the thing sold for $155,000. So this is in the days of when they bait you in with certain money and then the auction sells for so much more. 

 

[00:29:40] If I had have bought that, the money I could have made on that... and likewise there was another property in a really good suburb, a bayside suburb in Melbourne. And I remember I was gonna buy it to live in, we would have got a first home owners grant and lived in it and stuff. It got up to about $350,000 and at the time I was like, 'That is so much money, so much money.’ And I was buying it by myself. So I'm like, I'm gonna have this massive mortgage and blah, blah, blah. And so I pulled out of this purchase. I was in the running with someone else who was competing for it. But essentially, I stopped at $350,000. 

 

[00:30:13] And if I look at what that property was worth, now, I would just have to, I don't know, I'd have to crawl in a corner somewhere. But you know, at the time I had no kids, I had a good income, I could have supported that mortgage. And if I had, I would have made a lot of money. But I didn't buy it. Instead, I bought an outer suburban cash flow positive by $3 a week property. And in hindsight— probably not the best move. 

  

[00:30:21] So I think it's the things that I didn't buy that are probably some of the worst moments. But like I said, I don't dwell on it. You take it as learning, you do what's right for yourself at the time, or what you think is right at the time, and you just have to move forward.

Tyrone Shum:  

[00:31:54] What are you most excited about in your property investing currently?

Karen Young:   

[00:32:02] Because I run a business now, I'm flat out busy for a start, but I haven't bought property as frequently as I used to. The last project we did was a couple of years ago now in our Super fund. And a couple years ago we did a reno flip project. So it's been a little while, I feel like, anyway. I've just been sorting out some numbers and we're back in the market. So I'm very excited, I get excited about the chase and the potential and looking at something with potential. 

[00:32:32] So I've been having some fun looking at some sites with the development potential. And really, I've done a lot of education based stuff around development in the last two years or so. And now really putting some of that into play in finding and assessing sites for development. So that's what I'm excited about the minute I think. And then the business, obviously, our business is helping so many people, it's so exciting, too. We would buy at least one property a week. And some weeks, a couple of weekends ago, I went out, I bought three properties on one day, and it's so exciting. I still get excited about buying property. And not all for me, obviously. But I'm sending that excitement to the clients as well. So that's really good.

Tyrone Shum:  

Once she decided to invest in property, nothing could hold her back.

Karen Young:   

[00:00:38] I'm that sort of person. If I decide I'm going to do something I'm actually quite determined. But I think the thing holding me back was just I was busy. I was too busy living life, and I wasn't really thinking about the future. But once I knew that that's what I wanted to do, then I don't think anything really held me back after that.

Tyrone Shum:   

[00:01:06] Did you seek any mentors to help you with your property investing journey as well? 

[00:01:14] I haven't really latched on to one person and think they're the Messiah or anything. I tend to look at: What am I doing at this point in time? And then who can help me with that? Margaret Lomas' book was really good. And that was helpful. And then I became involved in that property investing group. And that was really good. That was what I needed at the time. 

 

[00:01:35] And then after a while, I kind of outgrew that group a little. And then I needed something else. So I latched on to the next thing that was helpful to me at that point in time. So there's been a range of people. I think Troy Harris down in Melbourne, when I first got interested in development, I went to one of his development days, I think it's called Working Developer. And that was really interesting, it spurred me into an interesting development. 

[00:02:00] Elise and Dean Parker. They did a renovation product. And it was an amazing product, it really was a fantastic product. And they've got an amazing success story, if you're ever looking for people to speak to, and they now run a very successful development company here in Queensland. And I actually went over to their house and interviewed Elise Parker, like after all these years, she was like this amazing story. And I actually got to meet her, it was really exciting. It was like meeting somebody famous. 

  

[00:02:31] Their reno stuff was really, really good, really good quality stuff. And I bought their product. And I went and I put it into play, I literally did it, what they said, and I followed it, and I learned so much from it. And we made a profit out of that project. So they were really helpful. So I think in terms of mentors, I tend to move to like, what is interesting, and what am I looking at at this point in time, who has done that? And I could read their books, I could talk to them, I could make contact with those people. So I've had a range of mentors at different points in time.

[00:03:56] Jane Slack-Smith's got a really good renovation product, like an education product if you're interested in renovation. And the reason I like her product is because it's not just focused on making your house look pretty. It's more focused on choosing the right property location, the one that's going to work, the numbers, it's more focused on that because renovation isn't about making the house look pretty. It's about making a profit. And so that's a really good, good product for that. 

Tyrone Shum:   

[00:04:33] What's the best advice you've received for property investing?

Karen Young:   

[00:04:36] I think the best advice I've received is a bit generic, actually. it's applicable to anything, not just property investing. But maybe three things I can think of. One is maintain your integrity. So there can be a lot of shonkiness in anything to do with making money, there can be a lot of shonkiness and a lot of dodgy people around. And there's spruikers. And there's people who are there to make money from you. But I think you need to be somebody who always maintains your integrity. So even in an individual deal, you don't need to do wrong by people to benefit yourself. You can have a win-win, I really believe in that. And I think you need to maintain your integrity. 

 

[00:05:25] Number two, I think people are everything. So this is a relationship business, real estate. And so you need to seek out the people you need. Whether that's just because, like we talked about, you need a mentor, you need advice. Seek out the people that are going to help you. Or whether you are looking for deals, seek out the agents who work in that area and make a relationship with them. Or you're looking at a development site, seek out relationships with a town planner, and a building designer. It's a team sport, really. So people are everything. 

 

[00:05:56] And then the last thing I think is to believe in yourself. I think that you need to believe in 'I can make things happen.' And that's something I'm a person, I don't [have] that whole, ‘I can't do this’ mentality. I'm more of a 'How can I do this?' or 'How can I make this happen?' person. And I think you need to be that sort of person to make things happen for yourself. So there's a few bits of advice.

Tyrone Shum: 

Although she can’t give financial advice, she can help with strategies— but recommends you don’t put all of your advice eggs into one basket.

Karen Young:   

[00:07:05] It's a tricky area as a buyer's agent— you are a real estate agent, and you can't give financial advice to people. In saying that there are some buyer's agencies who do provide written financial advice to people. Perhaps they have a financial services licence, I'm not sure. But we don't provide written strategies for people. 

[00:07:23] I think that often is the hardest part when you're getting started, if someone could tell you what to do, you would just do it. If someone said, ‘Do these things, and you will be successful in property’ you would just do it. But finding the person who can give you the advice on what to do is very, very hard, in my experience personally, and also with clients. So I often get phone calls from people or emails from people saying, 'Hey, I'm looking for someone who can help, to be my mentor, to give me advice on what to do.' And most people out there are giving you advice from a vested interest.

[00:08:00] There's a lot of people who write your strategy, but they are promoting off the plan property, for example. And so they write your strategy on how to buy six off the plan properties in the next five years. But they have a vested interest in obviously selling you that idea. So to find a person who is completely independent to that is difficult. 

[00:08:19] And same with us, we're a buyers agency, we can't give financial advice. I do talk to people, though, about this stuff, usually on the phone in an informal way. Because, honestly, I think the best person who can decide what you need to do is you, but you in conjunction with a bunch of professionals. So I think you need to talk to your accountant, you need to talk to your broker, you need to talk to someone who's got some experience in investing. That can be really difficult because everybody's experiences are individual. So they come at it with their own biases as well. So it's a really, really tricky one. 

[00:08:54] When a client comes to us and says, 'Okay, I've got this money, what should I buy? What's my strategy?' I do have a talk to them about 'Let's have a talk about where you're at in life. Let's have a talk about what your goals are, are you trying to get out of the workforce in the next two years? Are you planning on working for the next 10 to 15 years? Do you need something with high cash flow? Is it the growth that you're looking for?' 

[00:09:19] So we try and nut out what the goals are for this particular person. And then from there we can then make a plan for the next purchase. Like I said, I'm a person who believes in flexibility of strategy, so we can nut out what you need at the moment. But that's not necessarily what you need in 10 years' time. So I think the long term 'Here's your 10 year plan strategy'— At a high level, it's okay. At a detailed level, I think you're probably too far out to be doing detailed level analysis.

Tyrone Shum:  

Young’s services differ based on each individual client’s needs. They offer a full buyer’s agency service, but can also provide partial services and variations.

Karen Young:   

[00:10:25] People will come to us and say, 'I have this amount of money, I want to buy a property.' Sometimes they'll say to us, 'I'm looking to buy a number of properties in the next few years, I'm in the workforce, I've got a good job, I'm probably going to be in the workforce another 10 years.' So once we nut out that sort of stuff, we can work out, 'Okay, well, you've got a good income, you can support something that potentially may cost you a little bit of money to hold, maybe a growth property is a good thing at this point in time.' Perhaps when you drop down, if it's a couple they may be looking to have kids in the near future, are they going to drop down to one wage, maybe it's a different style of property at that point. 

 

[00:10:58] So we talk to them about what they want. And then we establish what's our criteria for this purchase, this next purchase, based on where we think you're heading, what your goals are. So then once we nut that out, we come up with a criteria. So we have a brief, it's a one pager that says, yep, this is what we're after. And then we go into a location analysis phase, where we actually analyse and say, 'Okay, based on your brief and your budget, here's the areas that we would suggest.' And we actually give them a few ideas, a few recommendations. So it might be north side versus south side, or it might be east versus here, it might be units on the inner city versus houses in the outer suburban area. And we actually do a report that's specific for what they are trying to achieve. 

 

[00:11:44] Then we talk about it with them. We're very collaborative. So we actually involve the client at each phase. Because I think the best person to make financial decisions for yourself is you. And so my job is to arm you with the information you need so you can make an informed decision, plus the benefit of our knowledge and experience. So once the person chooses a target location, then we actually get into the search phase. So we search for the property, negotiate, get something under contract, walk them through the contract phase, help them out with the building and pest, maybe renegotiate the price, do the pre-settlement inspection, and then help them with the management of property. So it's a full end to end service. 

[00:12:19] And then we have variations on that service where we offer just partial parts. Maybe just someone rings up and says, 'I'm putting an offer in on this property, can you do an inspection for us?' So we have an inspection only service, we have an inspector negotiate service. So there's variations but essentially, it's all a variation of that full level service and parts of it that suit people.

Tyrone Shum: 

Her company provides these services to all buyers, whether they be local, interstate, or even overseas.

Karen Young:   

[00:12:50] We deal predominantly with investors. In saying that we do home buyer purchases quite a bit. We've got a couple on the go at the minute. And mostly they'll be interstate investors from Melbourne, Sydney, South Australia, Western Australia. A lot of people who are away working, perhaps in the mines or working overseas, there's a lot of expats who want to buy back at home. So we deal a lot with people remotely.

Tyrone Shum:  

Young reveals her thoughts on the competitive Brisbane market and how to some buyers, 400 square metres seems more like an acre.

Karen Young:   

[00:13:28] It has been a growth market here for that time. A lot of people are just getting on board with that. And so we do get the phone calls now and again that's like, 'I've heard Brisbane is about to take off.' And I think Brisbane's actually been moving for quite some time. 

[00:13:51] It's funny, I was at a meeting not that long ago of buyer's agents, Brisbane based buyer's agents. And people talked about the property clock and where they think it's at. And 10 people there, 10 different views on where it was at. So that was really interesting. And no one knows these things except for in hindsight. So we're all talking about trying to pick the top of the share market, you can only really do it in hindsight. You can do your best guesses, but realistically, no one knows. They're just guessing. 

[00:14:25] Where Brisbane is at the moment, I think we've had significant growth for quite a while. I think we're still growing and we're still very busy on the ground. It's still multiple offer situations when you try to buy properties, it's still very competitive. But at some point in time, I think that growth is probably starting to slow. That doesn't mean it's going backwards like houses are losing value. It means the growth is slowing. And a lot of people mix those two things up. So you hear that the growth is slowing and people are like, 'Brisbane is going backwards!' No, it's not, it's still growing. It's just not at the heat of that flame. 

  

[00:14:57] So I think it's gonna slow. Whether it takes six months to do that, 12 months to do that, I don't know. Certainly when the election was on last year, bang, everything stopped for a month. While we all waited to hear what happened to negative gearing. But yeah, it's very busy. It's very competitive out there, particularly in the bread and butter sort of markets, between about $300,000 to $800,000, really busy.

[00:15:40] I have clients ring me up and say, 'We're looking to buy a townhouse in Brisbane.' And I'll say, 'Okay, what's your budget?' And they'll say, '$900,000' and it makes me laugh. You'd get a really good house in Brisbane for 900,000. I have a client who we bought a property for, and it was on a 400 square metre block. And I said, 'Well, look, it's a small block.' And he came up to look at it and she's like, 'This is acreage.' It was 400 metres squared. I said that's a small block.

[00:16:21] One of the problems that people face with that, Tyrone, is that they come down and they overpay. Sydney investors overpay for things, because they're just like, 'Oh, my God, that is such a bargain.' Stop that, people!

Tyrone Shum:  

Young’s Personal habits help her to succeed both in business and at home. 

Karen Young:   

[00:16:57] I think list making is the thing. I spoke in our earlier discussion about Asana, the project management system and the task management system, but I'm a massive list maker. And that includes goals. So actually sitting down and writing goals and putting them somewhere, like documenting them. I make lists, and I make goals. And I think if you keep doing those things, then you will keep moving forward. 

 

[00:17:25] But it's really easy to go, 'I want to buy a property this year', and then off you go to work and off you go home and you're looking after your kids and you're going away on holiday. And just to say I want to buy a property, it doesn't happen because you said that. It happens because you made a commitment. And then you took consistent action towards it. So to me, being a list maker and a goal setter is something that's made me successful in business and personally, as well.

Thank you to Karen Young, our guest on this episode of Property Investory.