In the face of adversity

Cheerful and with a no qualms attitude, Ms Keenan is proof that a positive attitude can help someone confront the darkest of challenges.

“My life’s good now,” she laughs. “I don’t have to work.”

Ms Keenan maintains an enviably optimistic outlook on life. Good investments made earlier in life also make maintaining a positive attitude that much easier, she adds.

Without the security of a property portfolio behind her, life would be much more stressful, she says.

With five investment properties totalling $1.6 million and delivering an $80,000-plus annual rental income, she is glad she and her husband made the move into this form of wealth creation.

Ms Keenan didn’t, however, begin investing until reasonably late in life, while her husband likes to take the credit for laying the foundations of their portfolio, she smiles – with a modest little purchase back in 1988.

A good start

One year before they married, her husband to be purchased a basic, small property in the western suburbs of Melbourne for a price tag of $52,000.

While Ms Keenan was busy enjoying the freedom that came with being in her 20s, her fiance was happy to be a little “financially challenged” so as to be able to buy his very own bricks and mortar.

Ms Keenan wishes, in hindsight, that she had realised the potential of property investment back then, but still refuses to think ‘if only...’.

“That first house was very modest, but it enabled us to buy the house where we live now and then another couple of investment properties quite close together,” she says.

As well as providing a foundation for their portfolio, the Melbourne house has proven a worthwhile investment for the couple. It’s now worth $290,000, with a yield of 28 per cent.

By the time the Keenans decided to buy what would become their principal residence, they had built up a substantial amount of equity in their Melbourne property. They had been renting it out, which made their next purchase very easy.

At this point, they were living in southwest Sydney, where they had moved seven years earlier.

Ms Keenan’s husband’s work in the defence force had forced them to leave Melbourne shortly after their marriage, and they had spent the next seven years living in the local defence quarters.

“It was basically subsidised housing,” she says, but rather than saving, the couple took that time to spend their money on travelling.

“We got the travelling bug out which was good,” she says.

In 1994, they found their new home, just 15 minutes’ drive away.

The following year, the Keenans purchased another house, just down the road, driven by a large tax bill and inspired by an acquaintance of theirs who was investing in property.

“One of my husband’s friends in the army at that time had four or five houses and I used to think, geez, he must be loaded!”

“I think that sort of got us thinking,” she recalls.

They decided it was time to try their hand at buying another property – to reduce their tax obligations if nothing else.

Like the Melbourne property, this one was unassuming: a three bedroom, single bathroom fibro house on a 900-metre square block.

Again, the couple was able to tap into the equity they’d built up in the Melbourne house, and they secured the new property for $119,000.

Today, that property is worth $350,000 and delivers a healthy 10.9 per cent rental yield.

In 1996, eager to purchase yet again, they began looking for something near the water that could serve as a holiday house.

Soon, they had secured a block of land at St Georges Basin, on the NSW south coast.

While the couple was in no rush to build, Ms Keenan soon became pregnant, and once her unpaid maternity leave kicked in, their household income was in for an unpleasant shock.

They needed to find a way to generate income from the block ASAP, and this came in the form of a three-bedroom hardiplank house that cost them just $60,000 and immediately secured them long-term tenants.

“It’s been earning good money ever since,” Ms Keenan says.

The dream of a holiday home of their own has, for the time being, been put firmly on hold.

“We’ve thought about making it a holiday rental, but the idea of giving up that regular weekly income... well, we just can’t,” she says.

So, when their first son was born in 1997, property investing took a back seat while the couple concentrated on their new role as parents.

Bad news on the doorstep

By 2001, the Keenans were keen to explore the investment property market once again, but their plans soon came to an abrupt halt – Ms Keenan had been diagnosed with breast cancer.

Investment took a back seat as she began her battle against the disease.

Initially, following extensive treatment, it looked as though she had been successful but in 2004 the cancer returned – twice – and then again in 2008.

On each occasion, she received a grim prognosis and the thought of being so ill that she might leave her family behind terrified Ms Keenan.

However, she remained resolute and in 2011, Ms Keenan is still here and with some improvement to her condition.

She attributes her improved health to a strong support network, a massive overhaul of her lifestyle and a positive attitude.

“It doesn’t mean you can’t cry but, long term, you have to be positive,” she says.

Pressing ahead

Ms Keenan continues to pursue property investment despite her battle with cancer.

Once she had a couple of properties under her belt, she realised she had become extremely fond of real estate and was an avid market follower. She spent many a late night surfing the pages of online property sites.

In 2003, the Keenans made their first purchase, in Queensland’s Townsville, since Ms Keenan’s first cancer diagnosis

Now a lot savvier in their approach, the couple took the time to really do their homework on the Townsville market and even flew up north to get a feel for the area and inspect some properties first hand.

Eventually they secured a DHA (Defence Housing Australia) property for $279,000, which Ms Keenan says has been a great buy.

“It’s had really good returns,” she says. “Even though they [DHA] charge a 16 per cent management fee, the secure rental has made it a great investment.”

The house was last valued in 2010 at $430,000 and brings in a weekly rent of $430, a yield of eight per cent.

In 2004, the couple secured an off the plan unit in Kalgoorlie, WA for just $166,000 and this property has delivered them the best returns – at least, in the shortest period of time.

Again, thorough research paid off and the property almost doubled in value as well as bringing in a yield of more than 12 per cent. It’s now under a five-year lease with the Western Australian Government and is cash-flow positive.

Building security

According to Ms Keenan, property investment can bring with it a feeling of security: “It’s the knowledge that it’s there, the comfort you’ve got substantial investment behind you,” she says.

Without their properties, the couple’s life would be a lot more stressful, she adds.

“For me, especially now that I’m not working and not able to contribute to my super, it’s good to know the houses are there.”

The Keenans’ investment strategy has not been an aggressive one, nor has it been particularly prescriptive, but it’s what has worked for them.

Of course, the couple is now keen to buy again and they are currently working out their next move.

“We’ve just got to be a bit careful now because our cash flow has taken a bit of a hammering since I stopped working,” says Ms Keenan.

“But I’m getting withdrawals!” she says. “I’m starting to shake!”

Clearly, their next buy is not that far away...