Is it safe to have all your property investments in one town?
For many property investors, it takes time and a lot of research to find the best areas to invest in, so they tend to put all their eggs in one basket once they determine a good market—but is this a good strategy at all?
After a few years in his property investment journey, MJ Anthony decided to explore regional towns to expand his portfolio. He went to Wellington, near Dubbo, and bought a three-bedroom house with one bath for $69,000, which was revalued at $130,000 in 2015, then went on to buy another investment property in the same area after five years.
“The other week, I created a little spreadsheet of where I was in 2015 [and] where I am today. Back then, I had four properties with about $200,000 of equity and $1.3 million of value, [and] since then I've bought another eight and the portfolio's doubled,” he shared.
“[Back then], I'm like, ‘Oh, I've only bought two properties this year—what's going on?’ But then when you look back, you can see how far you've gone. It's very important to look back, not just look forward.”
Moving forward, MJ said that he’s willing to buy more properties in Wellington if his overall capacity as a property investor would permit it. However, he’s also willing to explore new markets in order to achieve his goal of 100 properties and $500,000-worth of income every year.
“A lot of people go ‘You're crazy,’ and I'm like, ‘Well… have you done what I've done ... ?’ Walk a mile in my shoes before you comment,” he said.
“I don't mind where [I invest] as long as the numbers make sense.”
Smart Property Investment’s Phil Tarrant agrees that there a lot of good property markets where people can get worthwhile investments, and it’s always best for property investors to do their research before committing to a purchase.
For MJ, his biggest challenge as an investor is to find a property that is priced just right and ticks all the boxes of the fundamentals of a good investment property.
At the end of the day, it’s all about setting your goals and determining your capabilities and limitations as a property investor in order to find the best strategy that will work for you.
After all, no property investment journey is the same as another, so knowing your portfolio better than anyone else is always the best first step towards success.
Phil concluded: “Know your numbers intimately—that's pretty important if you want to have the aggressive growth targets in terms of portfolio sizes you've had. If you didn't know your numbers, you're talking down to pretty much cents on what each individual properties' positive contribution to you saving money in the future. You've got to know your numbers.”
Tune in to MJ Anthony’s episode on The Smart Property Investment Show to know more the benefits of investing regionally, how buying cheaper-end properties helped quickly expand his portfolio, and how he’s pigeon-pairing property to balance his assets.
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