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Ex-housing commission resident with 20 homes says property buyers have wrong mindset

Ex-housing commission resident with 20 homes says property buyers have wrong mindset (1)

A 28-year-old with 20 homes, acquired while working as a bartender, fast food cashier and clerk at a paint shop, says first home buyers have the wrong approach to the property market.

Eddie Dilleen attracts a lot of “haters”.

The 28-year-old owns 20 properties spread around the country, six bought in the last year, and all up his empire is worth about $5.5 million-$6 million.

It’s a trove of properties stockpiled while working some of the country’s lowest paying jobs.

He bought his first home while working at McDonald’s and subsequent properties were purchased on an income of $60,000-$70,000 a year.

It’s not surprising then that the Mt Druitt native’s approach to real estate has stirred controversy, especially on social media, but he also gets asked for market tips from first home buyers hungry to replicate his success.

His advice may come as a surprise.

“People think it isn’t possible (buying 20 properties) but it is. You have to stop saving a big deposit, and stop looking in your local area,” he said.

Ex-housing commission resident with 20 homes says property buyers have wrong mindset (5)

Most inexperienced property buyers were unable to capitalise on opportunities in the housing market because they only considered properties they wanted to occupy and only looked close to where they lived, Mr Dilleen said.

They also clung to traditional methods of getting into the market, he said.

“You’re better off using a small deposit and paying lots of mortgage insurance so that you can get into the market quickly. It’s better than saving five years for a huge deposit because the growth in value will be faster than your ability to save.

“Buying property should be about making money, not trying to save it.”

Mr Dilleen said expensive housing costs in Melbourne and Sydney meant first home buyers should consider investing in other locations and continue renting, rather than aiming to buy their dream home.

Ex-housing commission resident with 20 homes says property buyers have wrong mindset (4)

“I see Brisbane as the best place to pick up bargains. It’s been held back since the global financial crisis so there are more opportunities for property to grow than in Sydney and Melbourne, which I think are plateauing.

“You can rent much better properties than you can buy. A Bondi rental could cost $700 a week, but will cost thousands a month to buy. If you rent, you can buy somewhere else and still get growth.”

Mr Dilleen said buying properties that rapidly grow in value was the key to building a large portfolio of properties.

Growth in each property gave him equity he could draw to fund the purchasing costs for a new property, without having to save a deposit each time.

He only purchased properties where the rents covered most, if not all, his mortgage costs. This allowed banks to continue issuing him loans – even on a low income.

Ex-housing commission resident with 20 homes says property buyers have wrong mindset (3)

It meant he required minimal income to sustain his portfolio and could use money from tenants to pay down his debt.

His total debts are about $2.5 million, he said.

“I’ve been stuck many times trying to get financing,” Mr Dilleen said. “It was a struggle to get loans when I was on 10 properties earning $60,000-$70,000, and then when I had 12 … if you do a lot of research you can find (the loan).

“What I’ve learned is you can approach different lenders at different stages. Big banks are useful in the beginning but you can go to second tier lenders later on.”

He added that most buyers entering the market were unaware of their loan options and often thought they needed more money to purchase property than they really did.

“Some people think I only did this with an inheritance, but you have to work for it. I grew up poor. We lived in housing commission. My parents never had money. I invested in property because I wanted to get out of that life.

“The important thing is to do a lot of research. It sounds simple but there are a lot of people giving out the wrong information and it takes work.”

His first property was a home in Central Coast suburb Tuggerawong purchased for $138,500 in 2010. The initial rent was $220 per week, netting him a rental return of about 8.3 per cent – enough to cover his mortgage costs.

Still a teenager, he purchased the two-bedroom unit with a $20,000 deposit he saved from working at KFC and then at McDonald’s. He was earning about $500 a week at the time. The home has since tripled in value, he said.

Most of his subsequent purchases were units in southeast Queensland snapped up for $100,000-$200,000. Mr Dilleen also has properties in Adelaide and more expensive properties in NSW.

He funded the purchases often while working multiple jobs, including in the admin department of an automotive paint shop in Penrith and later in an IT admin role in the Sydney CBD. His income from these jobs was supplemented with earnings from bartending work in Western Sydney.

Ex-housing commission resident with 20 homes says property buyers have wrong mindset (2)

“My maximum income across two jobs was $95,000,” Mr Dilleen said, adding he usually only had two jobs while trying to get loans.

Last year was a busy year for him – he purchased six properties, including duplexes in the Ipswich region of Queensland, a townhouse in southern Brisbane and a house in Parramatta – now his principal place of residence.

Some of the properties he bought last year were funded with his super. “I’m probably one of the youngest people to buy property with a self-managed super fund,” he said.

Mr Dilleen also got married at a ceremony in Italy and has started a business as a buyer’s agent.

He suggested new investors stick to three principles. “Take all the emotion out of it. Always buy existing properties that are undervalued, not new homes. And always focus on getting high rental returns.”

 

 

 

This article is republished from www.news.com.au under a Creative Commons license. Read the original article.

 

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Market Place

Real estate industry in testing social distancing shutdown amid coronavirus fears

Real estate industry in testing social distancing shutdown amid coronavirus fears

Australian estate agents will set out this week to ascertain if they can continue to transact their property sale listings and leasing managements given the social distancing shutdown regulations.

In the absence of any official industry edict as at Monday morning, some estate agents will seek to adapt how they can continue to transact their property listings and managements.

Many agents are hoping it is business as usual.

On Sunday both the NSW Premier Gladys Berejiklian and Victorian Premier Daniel Andrew announced they will enforce a comprehensive shutdown of “non-essential services.”

But neither Premier indicated that the real estate industry was restricted from trading.

The later official advisory on stage one of the measures from the Federal Government advised the following facilities will be restricted from opening from midday 23 March 2020:

  • Pubs, registered and licenced clubs (excluding bottle shops attached to these venues), hotels (excluding accommodation)
  • Gyms and indoor sporting venues
  • Cinemas, entertainment venues, casinos, and night clubs
  • Restaurants and cafes will be restricted to takeaway and/or home delivery
  • Religious gatherings, places of worship or funerals.

The Urban Taskforce CEO, Tom Forrest, has called on State and Commonwealth Governments to be clear with their messages.

“The announcement must be clear and targeted”, Mr Forrest said.

Mr Forrest said that the messaging to date has too often been clumsy and ambiguous.

“If there is to be a close-down of business in NSW, what does this mean for construction workers? What does it mean for those working out-doors or indoors? What does it mean for delivery drivers or manufacturers?

Mr Forrest called on the NSW Government to be clear about if businesses should continue to operate remotely or shut down altogether.

“Urban Taskforce members support measures to prevent the spread of COVID 19. But support for the property, construction and development industry is critical to the economy and the hundreds of thousands of jobs involved,” Mr Forrest said.

The real estate industry appears spared from the extreme of the first stage of the shutdown if it enforces social distancing that doesn’t put the participants at risk.

One of the ways agents can adapt to these measures is using available technology.

Whether open for inspections for multiple unknown parties can continue is highly questionable.

Limiting auctions to registered bidders practising social distancing appears wise.

Requesting that visitors to open inspections come in small private groups and keep hands in their pockets while doing so are among measures being taken by some agents.

Last week some auction slated for inroom or indoor were moved outdoors to stay within the government’s 100 person limit on indoor non-essential social gatherings

All non-essential indoor gatherings of less than 100 people must have no more than one person per 4sqm.

“All Australians should expect their local businesses to be following this rule,” the latest official update advises.

There are around 115,000 sale listings on the market, according to CoreLogic. SQM calculate 68,079 vacant residential properties.

 

 

 

This article is republished from www.propertyobserver.com.au under a Creative Commons license. Read the original article.

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Brisbane

Brisbane auction buyers still keen amid COVID-19 fears

Brisbane auction buyers still keen amid COVID-19 fears (1)

As social-distancing measures ramp up in response to COVID-19, public auctions present an interesting challenge for real estate agents. Despite this, a bumper 94 auctions went ahead across Brisbane at the weekend, with a clearance rate of 39 per cent.

“Buyers were cautious walking in,” said Nick Penklis, director of Space Property Paddington, of his auction of the two-bedroom, one-bathroom house at 20 Atthow Avenue, Ashgrove.

“[People] kept their distance. But, having it in the backyard certainly helped a lot, because it can provide private space.”

Brisbane auction buyers still keen amid COVID-19 fears (5)

About 30 people gathered for 15 minutes to watch the auction, with five registered bidders attempting to walk away with the keys. Bidding opened at $700,000, and quickly jumped to $750,000.

Things slowed somewhat after this as bids of $5000 and $10,000 edged the price higher. Eventually, the hammer was dropped, and the house was sold for $885,000.

Despite the need for social distancing and hand sanitiser, buyers were still keen, Mr Penklis said.

“The buyers were there to buy, not to view,” he said. “It wasn’t like ‘Oh, we’ll just see what happens’. That was a strong sign for our market. The only thing we can’t do is shake hands. But, there were smiles all around, within distance.”

Brisbane auction buyers still keen amid COVID-19 fears (4)

The vendors have owned the house since 1997, and have used it as a family home and an investment property. Meanwhile, the buyers are looking to get a foothold in the area.

Auctions in Sydney and Melbourne are under a cloud from next weekend with premiers in those states flagging shutdowns of non-essential activities. No such plans for Queensland have yet been flagged, though it remains to be seen whether coronavirus may bite into Brisbane’s much smaller auction scene.

“We’re not expecting to see an impact on the values of homes but we will see the number of sales fall as people wait and see what is going to happen,” said Real Estate Institute of Australia president Adrian Kelly.  “Estate agents are pretty good at adapting in these circumstances.”

Elsewhere, Kosma Comino, of LJ Hooker Sunnybank Hills, sold the five-bedroom, two-bathroom house at 10 Mansfield Place, Mansfield, in Brisbane’s south-east before auction. He said COVID-19 was having an impact on people’s willingness to sell in the short term, but several sellers were still keen to get things moving in the coming months.

“I’ve got a lot [of auction campaigns] launching after Easter, but I think a lot of the sellers are up in the air with what’s going on with the coronavirus,” he said. “At the moment, what we’re seeing is a lot of increase in buyer inquiry, I think there’s a lot of panic buying at the moment.”

Brisbane auction buyers still keen amid COVID-19 fears (3)

On the other side of the city in Brisbane’s inner north, the four-bedroom, one-bathroom house on a spacious 810-square-metre block at 295 Days Road, Grange, sold under the hammer.

Just one party attended the auction, making one registered bidder and an audience of two people. Despite this, the house sold over reserve.

The single registered bidder was a developer, who opened with a strong offer and, after about 20 minutes of private negotiation, the hammer was dropped and the house was sold.

The vendors were two sisters who inherited the house after a death in the family. It was particularly process for them because the house had been in the family since the 1980s.

Brisbane auction buyers still keen amid COVID-19 fears (2)

Selling agent Georgie Haug, of Belle Property Samford, said the successful result was thanks to an incredibly smooth process, as well as the vendor’s willingness to trust her advice.

“I sold the seller’s property in Ferny Grove a couple of years ago for a record,” she said. “So, just the trust and the communication. I took [this] job in a heartbeat because they had so much trust in me to do the right job and get the result. It was just a really beautiful process.”

Closer to the city, the two-bedroom, one-bathroom house at 16 Skinner Street, West End, sold in an incredibly fast auction. About 20 people gathered to watch as two registered bidders battled it out for under five minutes.

Bidding opened at $700,000 and moved quickly to $800,000. Bids continued in increments of $20,000 then $10,000 until the house was sold for $970,000.

Selling agent Keryn Osgerby, of Sold Property Group, said 33 groups inspected the property over the five-week campaign, with the vast majority of interest coming from families.

“It was overwhelmingly young families who wanted to be in the area of lifestyle reasons,” she said. “Second to that would be the schooling benefit, but most of it was all about the West End vibes and lifestyle.”

The buyers fit this bill exactly and will be moving in with their young family very soon. Meanwhile, the vendors live overseas and were using the property as an investment. They sold because of a change in circumstances.

 

 

 

This article is republished from www.domain.com.au under a Creative Commons license. Read the original article.

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Cairn

Cairns real estate: Buy and sell remains strong in a pandemic

Cairns real estate Buy and sell remains strong in a pandemic (1)

A global pandemic has not dampened demand for property in the Far North with many agents posting record sales.

A GLOBAL pandemic has not dampened demand for property in the Far North, with many agents posting record sales.

Elite Real Estate Services sales director Karl Latham said this week had been the firm’s busiest in months.

“Obviously there has been a big impact in a negative way on the share market and bricks and mortar is relatively safe,” he said.

“We’ve got high vacancy rates, the mortgage rate has dropped to about 2 per cent. In any previous economic shift, usually the property market is affected in a negative way, but not now.

“We have just got to adapt, really – there is still an intention out there to buy and sell.

“There are still rental properties on the market, there will still be people taking job transfers and needing homes, people moving away and selling.

“I think the market will go on – the conditions will make it more difficult for inspections, but we will all come out the other side, whether it’s (in) a few weeks or a few months.”

Cairns real estate Buy and sell remains strong in a pandemic (3)

RE/MAX Cairns principal Ray Murphy said that in the past 10 days his office had completed seven cash contracts.

“And they were not small either – they were for properties worth $400,000 to $800,000,” he said.

“We’re finding because the stock market is so vulnerable and unpredictable, people are pulling their money out and putting it in bricks and mortar, and we are seeing a positive flow-on from that.

“I’ve talked to first home buyers who have said ‘if I lose my job, I’ll have to pay rent, so I may as well buy the house because the house is cheaper’.”

An auction held on Tuesday at the Whitfield chapel recorded a 50 per cent clearance rate.

Cairns real estate Buy and sell remains strong in a pandemic (2)

For those who already own property, Mortgage Choice Cairns’s Lindon Reed said there were two ways to take advantage of a highly unusual economy.

“Look at your own individual circumstances. If you are in a casual job and the future is a bit uncertain, talk to the banks,” he said.

“If you’re in a safe job or you’re self-employed but stable and you’re expecting your income might drop a bit, considering refinancing, even if it is a 50/50 combination, so you’re getting that benefit of the reduction in interest rates.

“We are preparing for people to hunker down and take advantage of these low rates.

“People are starting to say the RBA doesn’t have too much room to move, we’re expecting things to flatten out a bit. The banks have already proven they are passing the cuts on. Earlier this month, all they did was drop the variable rate, never touched the fixed. This time (on Thursday), the variable stayed the same and they dropped the fixed. They are hedging their bets.”

With first homebuyer’s grants and the mortgage insurance guarantee certain to continue, according to Mr Reed, the property market should continue to get an injection from the younger demographic.

“The First Home Loan Deposit Scheme is going gangbusters, especially for smaller homes and units,” he said.

 

 

 

This article is republished from www.news.com.au under a Creative Commons license. Read the original article.

 

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