UK Expat Turns $120K Deposit Into $500K Equity in 3 Years

Ultimately, by renting and paying a little bit more here has enabled us to be able to accelerate in so many other areas. So total cash, if you round it up, even just go, there's much cash in. 120, 130. Where do you get that return? Nowhere.

Growth is great. I want everyone to be comfortable they've got growth, but I really want to challenge that to say, what does good growth look like to you? Noodle alert! Property nerds. The home for data-driven property investors.

Where we uncover Australia's hot and cold markets, latest headlines and trends. Welcome back to another episode of the Property Nerds podcast. I'm your host, Arjun Paliwal, and today we're in for a treat. It's an investor story episode where we're catching up with one of our clients talking about the journey that they've been on to building wealth here in Australian property and being able to do something where if you actually just stripped away property from the equation and you said out loud, say $500,000 in three years, people would say you're crazy. Well, this is the reality for this investor, but through the power of equity.

And so I'm joined in by my good friend, James. Jimmy, what are we calling you today, mate? Jimmy. Jimmy, it is. Jimmy, welcome to the show.

Thanks for having me. Great to be here. Mate, I want to take you back to even before investing because I've spoiled it already. $500,000 of equity saved or equity grown in just such a short amount of time. And I'm not talking this like over 20 properties and that's just normal and that should be the case.

This is over just a couple of assets, which is even more powerful because people sometimes think the higher the properties, therefore the greater the result. But this is what a couple of well-selected, well-timed assets have done. But let's go back because property isn't just, I just bought that and I bought this and this happened. There's humans behind it. There's where jobs take you, where couples or singles or relationships, family takes you, mindset takes you, decisions take you.

So I want to peel that back because on the way to achieving this journey, there is you who goes through various aspects of life to get to this journey. So for those who don't know, I'd love to know a bit about the background. You're obviously not from Australia originally. So where you've come from, when you came here, how life kicked off for you and just those earlier days. Yeah, sure.

2014, arrived in Australia with the aim of being here for just one year. It was never the intention to still be here 12 years later. I decided that the climate was a little bit better than the UK one and maybe the earning potential, but on a visa you can be limited and stayed another year and then found myself sponsored and then found myself looking for residency. And all of a sudden it's 2026 and I've been here for 12 years. Obviously met Danny, my partner, who has been on a very similar journey.

We were kind of introduced by mutual friends that has put us into the position that we're in today. Yeah, that's me. That's how it all kicked off. But I mean, mate, I've been fascinated. Obviously, I've been to the UK for the first time last year and Australia is very far away.

The plane rides are not for the faint hearted. So when it comes to that decision to choose Australia, like what was the original decision there? Was it people that you knew here? You're like, I want to hang with you for a bit. Was there an opportunity that you saw?

I'm intrigued when it comes to like all these amazing countries along the way. You know, you've got the Spain, the Italy, the Dubai, so this and that. Like, I'm always intrigued. What's the reasons? Yeah, that's good.

And I always say to people that I've never really traveled Europe because we think of it as a number of countries away. Like I could fly to France, I could fly to Spain and yet Croatia, all these are seven or eight countries away. But to get here, I was like, let's go to Asia for a bit and then maybe we'll go there for a year. And I had one of my best friends was here in Australia. What kind of gave me the comfort?

Yeah, we'll go via Asia. We'll come on here. We'll just do that one year. And I've got my comfort blanket of my friend. That's probably what made me sort of jump to the other side of the world because it wasn't supposed to be.

Let's pick everything up and move. Now, when you're on the other side of the world, I see this often. You're landing here and you look around. Sydney, firstly, is not the cheapest city in the country. Sydney property is not the cheapest property in the country.

And so I'd imagine someone from I'm just going to be here for a year to then. All right, let's hang here longer to then looking at all the prices of real estate, which also it's not cheap in the UK either. Are you looking at all this stuff? Did it ever come to you that, hey, that's going to be me? I'm going to be in the market.

This is totally possible. I'm getting in. Like, what was that gap for you in terms of what you saw versus where you're at? And how did that bridging of it start to happen? Yeah.

So firstly, the earning potential for me in Sydney is probably why I stayed in Sydney. There was such opportunities for me as a result of that. And then, yes, the Sydney property market, maybe I felt priced out. That's actually why I came to invest again. Me and Danny wanted to buy our preferred home in Sydney as opposed to choosing a suburb that we didn't want to live in.

So we rent vest and used invest a kit to obviously get to the goal of creating equity to get us our preferred suburb. So that's kind of where I started to see the gap come. But yeah, I couldn't have afforded to buy in Sydney, maybe just working. There was a clear gap there. Did you have a whole bunch of peers around you who made similar moves from overseas and from the UK to Australia?

And they're like, that doesn't even come to mind, like the concept of rent vesting, the thought of even any property ownership. It's just good sun, beaches, lifestyle, good job, earn, have a bit of fun, enjoy the social life of Australia, and then maybe head back or a different country or explore what's new. Does that happen a lot? Like what separates? What's the separation between a few that do achieve it versus those that don't?

I think everyone on working holiday visas and anyone who is then working hard to get their residency for citizenship. We know how difficult it is. That is absolutely not in our kind of goal or ambition to look at property. It's just what can we do to stay in the country? So very early on, most people will just say this is not even on our mind.

It was only once I got residency and then you're like, OK, actually, I'm here for good. What's next? And then in my group of friends, we have really close people that had already started this journey before. And so I was like probing them on. What do you mean you've got two properties?

How did you do that? Like, I just know you from, you know, working in the call center. You were here for the sun. Now you're here for good. What do you mean you won't do?

So that's kind of where that then became a bit of reality. And then I kind of poked up a little bit to sort of dig deeper. Makes sense. Now, let's go forward to what I think is an actual superpower for those who actually aren't from here. And that is the element of ignorance, like not knowing like anything.

It's like bliss here, because when you don't know, you know, you need help. Or when you don't know, you don't have biases attached to stuff. Because if I think of the first property we'd purchased together, Farnorth, Queensland. And in Farnorth, Queensland, if you're a Sydneysider, it's like, I'm not sure if there was an appropriate meme to chuck in, but people go, ooh, brother, what's that? You know what I mean?

People are like, ooh, what's that? Right. And they're like, not to say any hate for the Queenslanders, but it's more like a Sydneysider just going, I'm from Sydney. I know Sydney. What's Queensland?

What's Farnorth? What about South Australia? Why? All these moves that people make. How does that help you?

Do you feel like that actually helped you not knowing all of Australia in the way that people know it? Because that mindset then doesn't exist around what's possible versus something set around where you go and where you don't go. Yeah. I actually was aware of Farnorth, Queensland, but not to the detail that I knew Sydney. Nowhere near.

I'd lived obviously for years, but in my first year, I did a little bit of travel. So I passed through. I mean, our first property is in Townsville. All I got with it was the bus ride in and a ferry to an island. I didn't know anything about Townsville other than what I saw for those two hours.

So yes, I now have a bit of confidence for what was given to us. And this is what's in this area. Just because you're X amount of thousand Ks away doesn't mean that's not the right move. We just needed maybe some confidence of why to go to those areas. But yeah, that's kind of where I started to see the gap.

But yeah, I couldn't have afforded to buy in Sydney, maybe just working. There was a clear gap there. Did you have a whole bunch of peers around you who made similar moves and everything fell into place. So high level it was, but en route it was just having that confidence, I think, to see the numbers, to be like, we can absolutely come back to the second one because we know what we're going to expect next time around. It's so important getting that first one right then, isn't it?

Because I just imagine if it didn't grow as well, you've committed to a journey, you're working with a professional, you're paying fees for it, you're going borderless, you're not getting the place that you could live in, even though it was many, many kilometers out, it probably takes away from the lifestyle aspects as well, and you're shooting at a dart where maybe like some, you're throwing a dart where so many people were like, oh, don't do that, or maybe don't do this, or why there? And I can totally see that the power of that first one getting it right, going over to the second. So let's talk about the journey of doing it yourself or doing it with professional help. What inspired you to go, look, investigate, I want to work with you guys to help me, and I don't mean it from the perspective of why investigate, but why have a professional on your side to even begin with? Yeah.

Firstly, Danny would quite often, we had a busy lifestyle. Saturday morning, click contact agent, because she's always trawling through the listings. By the time Monday morning comes around, it's just sometimes we didn't even get a reply. Some of the replies are, this is gone. This is not on the market anymore.

And you're like, but I've just clicked on it. So firstly, there was that very clear, where do we even, how do we even get in? There's a lot of noise in this space. You can hear about one area from someone, another area from someone else. We were, I have close friends that then started investing.

And I said, oh, why would you pay someone for that? So you just go and view it. And they're like, yeah, yeah, but it's not around here. It's not local. I'm like, well, where is it?

And then they would start describing some of these locations that match kind of in their portfolio. And I'm like, well, when are you flying to see that? They're like, Jim, they do everything. And then I started understanding, okay, actually, you're paying someone a service to do quite literally everything en route. So that would be understanding what is the right market for us, the research into that area, the listings and getting walkthrough video, everything was there.

And even something that I definitely overlooked initially was like, well, who then tenants it? I didn't realize until we started buying the first one. I was like, okay, and it's like, don't worry, we've got someone that we recommend. It was like, I would have never been able to do that if I did all that. I just think about the amount of components that is involved in doing it yourself.

It's just no way. And you know the dangers of doing it yourself. It's not that people can't go and emulate it. It's the fact that human nature will take you to make the easiest decision possible. Where can I feel it?

Where can I touch it? Where do I know? What have I heard of? What looks good on paper? What piece of paper did I get?

Was it full of information or less of information? Oh, it's full of information. I got that. Perfect. Even if it was the wrong one, even if it wasn't the right one.

Who was the nicest to share this info for me? The sales agent that got back to me the quickest. You notice how none of these metrics have data to actually drive success of a property or a portfolio, but they're all the metrics or the signals that make our human brain come at ease. And then when it's at ease, you make poor decisions. It's just like, you know, the occasional time where I'll open up the fridge and grab something I shouldn't grab because it's a lot easier than cooking up the stuff, right?

But mate, we go to the second place, right? And the second place we go over to Wodonga. And again, this is testing the whole, where is this? What's a Wodonga? So you're probably saying, right?

That one was where it was. And so all of a sudden, this now introduces our formula to investigate, which is diversity, both in states and cycles. And for those listening into this who want some context as to why it's so common, the investigate thing, investigate system. It's the fact that I'd take you back to 2018. And at 2018, when I'd first kicked off investigate, I look back and I met this couple.

And this couple that I met, and this is the unintentional reason for the strategy. This couple that I met had half the value of assets that I'd had even prior my business starting or just starting. They had half the amount of properties that I had, but they had four times the land tax bill. And I was like, the hell is that? And then they were upset when times are bad nationally.

They were happy when times are good nationally. And I'm like, again, what's up with that? And then I realized that unintentionally, I'd created this huge layer of diversity in my own portfolio from trying to just find some pretty good markets at that time. And then my portfolio before starting investigate was already at Taz, Vic, Queensland, New South Wales, as an example. So across four states.

And so that was a big eye opener for me. And that made me realize that you can have such an inefficient portfolio, both in taxes, and you can have such an inefficient portfolio in terms of cycle timing, where something is going up when everything goes up at the same time and something's going down, your whole portfolio goes down. And then I made sure that, hey, I got there luckily for myself to have that. And I never wanted it to be luck again. And I never wanted it to be an issue for any other portfolio.

And so like you guys follow that strategy to a T and straight away you went to Victoria next. And I want to take you back to this time in Victoria because a few things are going on. Number one, the taxes are in Victoria. Don't do that. The government is really stuffing up the state.

Number two, hey, the highest cost stamp duty in the country. Don't do that. Number three, again, where is this place? You know, all of these things. I'm not saying you said that necessarily.

Maybe you did say that. But those three things were commonly coming up in people's mind. Again, I want to ask you this question. How do you block the noise out? How do you make decisions together as a couple to go like, this is it amongst all these things that seem down in circles, networks, internet, on the news, wherever the information is coming from?

I'm not naive enough to call things like land tax or anything like that, the small stuff. But truly, that now goes into the bracket of sweat and the small stuff. If the research and the data and what can lead me to make a decision is better in the long run, then it's kind of inconsequential looking at those little things. There's going to be things on the way. I mean, you refer to it a lot, speed bumps.

The strategy was built as a buffer to waive any speed bumps. And I wouldn't even call land tax a speed bump. It's a cost that's involved in allowing me to generate the equity to get to my goal. So hopefully that answers that. Yeah, no, definitely.

When it comes to that decision now, I mentioned at the start of this episode, 500k of equity created. And there are so many vehicles where one can invest in. But if you take your initial capital, the initial one, because remember, the second one didn't come from your capital, it came from equity. That's right. Right.

And for those who are like first time investors, like Jimmy was back then in 23, in property in Australia, that equity piece is essentially the fact that the Townsville property grew so well, instead of using your own savings between you and Danny to purchase the next property in Wodonga, you basically, I have the saying, you scribbled three pieces of paper. One is, hey, equity loan, give us some cash. Second is pre-approval, give us a new property. And third is contract to sell new property. Right.

So these three scribbles of papers, obviously the thick stack of papers, don't get me wrong, but those three things created this new wealth. So if you go back in time and you go to the original capital, how much was the first deposit input into Townsville when you look at deposit stamps and everything, just like a total cash, if you round it up, even just go this much cash in. 120, 130. Four times the cash in return in three years. Where do you get that return?

Nowhere. Yeah. I just think it's funny. Like we always, me and Danny look back at it. It's one of those things we don't try and look back in a negative way.

It's one of them things we laugh and we're like, why did we hold off for like a year before? Because it was ready to go. Yeah. But we just. Do you ever think of the moments and go like, what exactly would, what was it?

Did you guys ever come to the answer? Like, was it the smash avo or was it something else? What was it? What was it in your eyes mind? What specifically?

Yeah. What specifically was it that held it back? Like, was it something that you two talked about that was like that? I put it down to this thing here. No, ours was You get to track some of the results that happen down the line and you see the successes or you hear from case studies you've seen in the past or your own journey.

What are some commonalities, whether that be like mindset, decision making, things that they do differently to those that have had a rough start for themselves? What do you notice? Because you speak to so many people. It's totally trusting a professional. That's probably the most obvious.

Not only were they buying their backyard as maybe a mistake, but they felt like they knew areas because they might have heard something on Google or they might have done what they feel is due diligence. But really, when you look at the profession, I know the team with the first one, certainly, that was an eye opener to be like, OK, there's a significant amount of due diligence that goes into this process. I can trust these people. And so the commonalities I see from all the people that come on board is like, I need the team around me. I understand getting from property one to two is not just an easy decision.

Everyone can't do it, as most obviously don't. Having the right team around them, following the data, and of course, the due diligence of the guys to say, this is the one. When they all trust in that process, it always generates the results that we obviously see daily. So you feel like the difference between those who just go, hey, I'm going to have more success or end up having more success. It's just that more like the guards down, the barriers down.

And so it's just trusting of that team around you, like integration. All I do all day, every day is hopefully understand, is there anything that people don't have in their journey at the moment? Is there anything they think they need? And if it's things that we bring, and more commonly than not, it is, I can then obviously show them what they can expect going forward. So yeah, and the ones that see the value in that totally put the trust in us to start the process.

Yeah, that's what we see. When it comes to our journey, this is like back to something I was just thinking of. And I've got a few things in my phone that I had some notes of. But one thing that makes me like most happy isn't just your results, but you actually have a very large circle of friends that have worked with us multiple times over. There are just people indirectly you've known too that have ended up working with us too.

And I have a fun fact to share with you is, and I'm bringing this here, your group of friends and you together are the second largest referral link in over 1900 clients across Australia. So referral link for those who may not be familiar with the term I'm using, it's basically the chain of people that know each other. It goes into the dozens and dozens of like people who know each other, then kind of know each other, then know you, that know him, that know you, that know her. You know what makes me like just, and I know this isn't a question, this is more a thought I just wanted to pass on. It's like, you know what makes me like most proud of that isn't the advocacy and trust alone.

That's super commendable to all those people that made that difference to us. But it's the fact that like when I go to bed, I sleep at night and when I wake up and I think of all the portfolios, think of all those involved, there isn't one person that comes to mind either I know or you know that hasn't crushed it. And like I just feel like that to me is just so important when it comes to that advocacy because we're in this world where like our industry, advocacy is very like dangerous and very helpful. Like it's one of those helpful ones where it can change the person's life. But as this chain gets bigger and bigger and bigger, you'd hate to be that one person that didn't work out for.

You'd hate to be that one person in the group where everyone's around and like it didn't work out. You'd hate to be that person who let down this large group that's gone on to just tremendously like spread the word. Like I can remember one time and it was wild. Like I remember going to this like boxing event in Bondi and there were two people who I didn't expect to be there. They're like, you know, friends of yours.

And they said, hey, and another person knew another person who goes, hey, meet this person. They're like, what do you mean meet this person? I just used the team last week. And then the other person in the ring finishes fight comes down to Bondi gym there and he just goes, yeah, all the mates here said that about, you know, working with team investigate and I'm chatting to some of you guys next week. And another person overheard is like investigate.

Wait, are you guys there? Oh, you know him. You know her. Yeah, I know them. You're obviously on the other side now.

How does it feel seeing the other side? Like, how does it feel like seeing the inner workings of it all? And what do you feel it is that has gone on to create some of this impact? But yeah, I just want to get your view of things on the other side, I guess. Yeah, I mean, it's quite a good question.

Sincerely, the detail that goes into everything you mentioned earlier. Everyone has the same amount of interest in the business as you and you would call BS that you're the only one that thinks the way you do. I saw that instantly day one. The amount of effort that goes into every single department or every step of a I just saw it instantly. So I think the reason as you explain it, I had like a good analogy in my head.

Sometimes we don't refer people to a job role that we work in because we're worried that we're going to let our boss down and we're going to look bad. I will never under any circumstances doubt anyone when I say you should use investigate. There's never been not from since day one. I've never thought this won't work for them because I know that it's and now I can see it on the other side to answer your question, which is I thought as a as a referrer, shall we say, or as a friend that was like, you should choose them. I was like, they'll get you good results.

They'll look into your finances. They'll build buffers. All that's great. Now I look at the detail behind. So I'm talking the hundreds of properties that don't come to me and my friends.

Yeah, that that shocked me. So when I joined, it was like, oh, we're rejecting that many. If one doesn't make the checklist, that's it. That's in the rejection pile. That was kind of powerful joining.

I kind of thought, oh, great. We've just got access to more. No, it's it's clearly the detail. Nothing second second rate or second grade, should we call? Yeah, that's probably been and like because it's people's future.

It's people's financial future. It's not like it's not like, oh, that's a bit odd. Let me go get you a new one from out back. It ain't that. So true.

I mean, it's like, oh, did you drop your coffee? Let me make you another one. And look, I'm not downplaying any of those areas, but I'm just like emphasizing the importance of what we do in terms of the dangers and the positive impact. Like you can win big in this world as a client, but you can also lose. And so like you have to just go that like that referral chain does not happen if along the way people don't have success.

And not everyone in that chain knew each other. So your example was great because there's so many of us in it. I literally met someone three hours ago. Yeah. I said, oh, you know, Danny.

Yeah, this is great. Do you know about these people? I didn't know they use you. Yeah. And I said, how did you find out about us?

And they named two people that I didn't know used us. Yeah. So there's so many of us. And that only happens, as you said, organically by everyone getting the same result over and over. Absolutely.

And you know what else is surprising is the sheer number of people from Salesforce. Like it's crazy. Like how many people like are in that building? Like I just use it as an excuse now to head up to the rooftop to have a coffee on the house, the view. And it's just amazing.

But mate, I also wanted to talk about one more thing. Rentvesting. You're obviously doing that now. And that's been a game changer from the financial aspects. Many people don't talk about the game changer it can have, though, on the actual like growth aspects.

And I'll tell you what I mean by growth, not financial, but it links to financial. Where you rent versus the value that you can get in comparison to what you pay to buy. That value gets so much larger, the nicer the location you choose and the nicer the property you choose. So like getting as close to the town or the beach, getting as expansive as a property or amenity up property equals a larger multiplier effect in positive favor of the tenant you have in Sydney specifically as a rent investor. And so the growth that that can have for people, it's so underestimated.

Like I'll give you an example. Where you work and the proximity and commute. Where your friends are and the social life and what you have after a long, hard grind day to look forward to. How the flexibility you can change, the amenities that you can have at your fingertips that are deemed as extreme luxuries, but at the quarter of the price because of the mortgage and these things not being an equation. Do you feel you've now, A, become a major rent investing fan now?