From $66K to $5M: The Deals That Built a Property Empire with Gus Vella

Hi, I'm Andrew Wright, principal of Professional Southport, and this is the Andrew Wright Property Podcast. I've built a multi-million dollar property portfolio delivering a seven figure annual rental income, and led my real estate team through thousands of sale and lease transactions. In each episode, I share real deals and strategies that will help you find, fund and operate profitable property deals.

The aim of this show is to provide education and build a community of like-minded investors who can collaborate, share insights, and help each other in each other's journeys. You can make excuses or you can make money, but you can't do both. So come and join us.

Good day, and welcome to the Andrew Wright Property podcast. Today for the first time, I'm bringing on a guest and he's a long-term friend of mine, perhaps, uh, nearly 20 years. Mr. Gus Vella. We are going to break down four fantastic deals that Gus has done. The first deal was a $185,000 purchase that Gus managed to sell for $5.1 million, a $5 million profit deal, two, a $650,000 block of rural land that Gus sold for $1.7 million, a $1 million profit Deal.

Number three was a block of units that Guss renovated and sold all within a 12 month period with a 33% return on money. And his final deal was a Morga in possession sale that he purchased $700,000 under market value and. A $250,000 rental income. Gus, welcome to the show.

Thank you.

Can you, I've known you for a long time.

Um, can you tell our audience a little bit about your background and how you got into property?

Yeah. Um, good question, Andrew. Yeah, I, um, I was a school teacher, um, in my early twenties and, uh, I, uh,

on the Goldie

on the Gold Coast. Yes. Yeah. High school teacher. Um, and, uh, started doing that and bought my first property about three months into, um, being a school teacher since I had a, my first permanent job and I

You were in your twenties or,

yeah, early 22.

22. Bought your first house at 22,

20, uh, 23. I, I graduated 22, 23. I bought my first house.

Yeah.

Um, and, um, in Southport, uh, for $66,000, a three bedroom, brick and tall house. Um. We discussed this previously, but Yeah. In Marin Street, not far away from where your offices sort of thing.

Yeah.

Um, and, uh, yeah, yeah.

It, while, while I was school teaching, earning my $30,000 a year before tax, I, um, got a call from the agent, um, the following year. So after approximately 12 months, he rings me up and says, um, are you choose of selling your house? I said, well, I've only just bought it.

Mm-hmm.

And he goes, but I can sell it to you.

Sell it for you. Uh, right now for 140,000, I'm going, why would I, no. Is that for real? 140,000? I've just, that's

more than double.

More than double in 20 months and 12. I'm going, what's going on here? Here I am at school teaching economics. You know, how, how the real not, not the real world works, but, you know, all this curriculum you gotta based, based on, you know, information to students about how the, how, you know, what happens in the world and

Yeah.

And this guy's telling me I potentially made 70 odd thousand tax free.

Yep.

Um, while I've been school teaching, earning probably more like $20,000

after tax 20.

And uh, so I, I looked at myself in the mirror one day. I went, well, you know, these students, they're giving a bit of a hard time sometimes and I'm, do I really want to do this for forever?

And I, uh, kept on doing it for a bit longer, but, uh, realized that I could, um, potentially, you know, make my, um, life goals happen a bit sooner, you know, than, uh, through school teaching, you know? So that was a, something that triggered me off having an interest in real estate.

And was your transition straight into it full time or did you do a couple of investments on the side while you were teaching?

Or did you just quit your job and go?

Well, I did quit my job the following year. Um Okay. But I could, 'cause I could get loans 'cause I had a permanent job, you know?

Help

people, loans and all that. So

yeah,

after getting that and getting that sale, I, in my, my home, I looked an opportunity, which was that first one we were gonna talk about because I had equity.

Then all of a sudden I've gone from very little equity to a lot of equity property and the banks would, could see that I could borrow money to, to finance my second property, which was that property for 185,000, which I sold, I purchased after my 140,000. Okay. On sale. So, yeah.

And before we run through the four deals, uh, you, you have been not just land banking and making money, but you've actually been involved in developing sites as well, just in.

In summary, uh, what have you built? Units or townhouses? What sort of developments have you done?

I've, um, built predominantly townhouses, um, from, from vacant land or in some cases we knocked houses down and built, um, blocks of, um, boutique blocks, like from five up to sort of 15 sort of blocks of units, or sorry, townhouses.

Yeah.

Um, in some cases prestige houses as well. I've done, um, by the beach front, you know Oh, yeah. Down over the border in New South Wales and Kingscliff.

Okay.

So I've done some houses down there in a new brand new estate by the next to the beach. Um, so that's predominantly what I've done in the new, new developments.

Yeah.

Right. Great. Okay, well, um, let's get, get into these deals. I'll just refer to my notes here. Deal 1 49 Eggers Dorf Road. Oromo. Uh, this is, uh, unreal. Gus uh. Bought for 185,000, sold it for $5.1 million. Can you just talk us through the deal and the, the timeframes and how you financed it and talk us through the deal?

Yeah. Okay. Well, that property there, I purchased as like my second property, um, which I eventually rented out, but I

How old are you at this stage?

I am in my mid twenties.

Mid twenties?

Okay. Yeah, mid twenties.

Yeah,

because that property, when I sold it, I was 40. So yeah, we held it, I held it for approximately 15 years.

Okay.

So I did the financing through the sale from my first house.

Yep.

Used the equity, got into that. I again,

so you paid cash for it or?

We, I borrowed funds.

Yeah. How, what, what's like 50% over the year?

50% because I had that 50% equity out, out of the sale from the first property that we put some. Our own equity into the purchase.

Yep. And also the capital growth that we had, which was tax free.

Okay.

And then, yeah, the rest we find,

so what was it, how many, how many, like acres of land and what sort of house was

it originally? It was mine purchased, it was advertised as 15 acres, which is six hectares.

Yep.

Um, with a two story brick house.

Um, approximately 40 squares solid brick.

Yeah. Right.

Brick house.

Okay.

Um, four bedroom, double gap, you know, you name it, billiard and was fully furnished, build table. Everything was the person unfortunately was ill.

Yep.

And had to get out of it quickly. Um, was suffering from ill health. Um, and it, um, was soulfully furnished, had, uh, guest quarters as well, had machinery, shed with machinery, tractors, everything.

You know, it was like old hobby farm. Um, but, but the thing I liked was the location that, um, I'd been looking and reading about the, the growth in the area and, um. Realizing we've got a capital city up the road about an hour up the road as we know Brisbane.

Yep.

Third largest city in Australia. And the Gold Coast being only, you know, an hour south, I guess.

And, um, approximately while I suppose six larger city in Australia. And all, all that reading I was do, I was finding out, um, my, my, my research was that this corridor was gonna be in high demand in the future. 'cause the natural progression of growth being in the same state was, was north from the Gold Coast.

Um, west. We've got, you know, the, there are hindrances with mountains and hills and being further from infrastructure and the beach and the coast. So I thought that the corridor was the way to go. That was what my research was telling me. Um, and

was marketed with the price, was it, did it have a price on it when you purchased it?

And was 180 5 in your view a bargain at that time or just a little bit?

Yeah, it was, it was advertised around the $200,000 mark.

Okay.

Um, but we managed to get it for 180 5. Yeah. That was. I thought it was exceptional binding. Mm-hmm. Because I was, I went down to the council and looked at, I didn't even engage a town plan, I just did, did my own due diligence and looking and seeing that it wasn't a, a future urban footprint.

So they had, the council had earmarked, well back then was called the Al Shire Council, that this was a, a future urban footprint area of, um, for where the, the town was gonna grow from this Omo area. You know.

So you thought one day it would be used for residential development,

for houses, for residential.

That's what I was led to believe by the, um, council footprint saying this is a future urban zoning that's gonna happen even though it's rural now, but this will be future urban, down the track at some stage in the future. So from my point of view, it wasn't a, a short term investment, it was gonna be a long term.

And, um, that was. The way I was thinking anyway.

And at some point in time, you told me prior to the podcast that you were approached by the state government to reclaim some of the land. Can you tell us what happened there?

Yeah. I was advised when I was purchasing the property that there is li high likelihood that adjoining the frontage of the property of the corner of the property that like a triangular tation, that the Queensland railway were going to build a train line again.

'cause they had, there was a train line once upon a time to the Gold Coast and, and all their wisdom, they sold off all their land back to, to, to, um, all the private landowners and never, you know, they thought, no, it's not gonna happen again. But it obviously was on the cards 'cause of this growth. Um, I mean, most people looked at it, shied away from it and thought that was gonna be an issue.

You know, who would wanna be next to a train line, which 99% of people would probably think that way.

Yeah.

Um, I. I could see that it could be op an opportunity that something could come outta this with more, more, more growth in the area that need needed to be near services nearer to services, be it residential, commercial, um, so might even be another train station there one day.

That was what was I, I was being led to believe, you know, that there could be a a, a big push of urbanization so they could be a risk for a train station there in the future.

Just, just on that, like, uh, my subconscious has, has come up with a question now about w when, when everyone else looked at that site potentially, uh, going to be a rail station, did that mean that that property was, no one else was interested in it?

Like was it on the market for months or did you buy it straight away without any competition in the first couple of weeks? Or was it a site that was difficult to sell? 'cause everyone knew there might be a train train going through there.

It was a hindrance. Yes. The train line was a hindrance to most people.

Yep.

So I can't say, I can't recall 'cause this was obviously.

Long time ago.

Long time ago. Yeah. How many people were looking at it? But we certainly, I didn't muck around with it once we found out about it.

Yep.

And we put an offer in and remembering that it was fully furnished with all the, all everything walk in, walk out type thing.

Um, so

free pool table, you gotta play fire place,

eh, tracked all the, to all the, all the toys out there. You can play around with lot modern mowers, you name it. The whole, you know, there there's even a chicken pen with chickens in it, you know, so it came with everything.

Eggs for breakfast every morning.

Yeah. And there was several fruit trees and Yeah. Wildlife go with it. And it was only literally 500 meters off the M1. 'cause they remember 49. That means it was 490 meters from the M1. 'cause that the fire brigade, they tell them, they, they do, um. Number of properties.

I didn't know that

they work on how many me meters, you know, from the, to, to, to work out

Wow.

How far they are from the M1 'cause they're all rural properties and day, so it was, yeah, roughly five, half a kilometer off the M1 and, um, yeah, sorry.

And so what, what happened then? Like, you, you lived in that place where you rented it out for 15 years. What happened?

Lived in it initially. Yep. Mm-hmm. Um, eventually moved out and moved back to town and rented it out.

Yes. So we, we, I was getting approximately $300 a week rent. Um, so you can do the sums there. It was paying itself like in the time that I held it.

Yeah.

I was in front just on rent. You know, if you look at positive cash positive, yeah. So, um, and that was only just renting upstairs, predominantly upstairs. I kept the upstairs for myself so I could still go there if I wanted to on weekends and falling.

Do anything with the machinery or maintain any property of the back. 'cause the people, you know, there's a 15 acres, um, in initially until the resumptions happened,

and you've told me that the secret to that massive $5 million profit came about when at some stage the council rezoned that land. Can you tell us what happened?

Yeah, well, uh, like I said to you, initially it was a, in a future urban footprint

mm-hmm.

Um, as my neighbors who probably weren't as patient, um, as myself, they sold their land to developers who then subdivided their land into residential rotmans.

Mm-hmm.

Um, new estates, um, I suppose I was almost like the last man standing with this property, um, in this urban footprint that hadn't developed it.

Mm-hmm.

Where they wanted the, the center of this. Or Motown or whatever you wanna call it.

Yep.

Um, um, township. So, and that put probably more pressure in, in changing the, the, the little.to a blue dot, which was more commercial.

Yeah.

Um, and then people like Coles, for example, came knocking on my door, you know, to, to want to, to buy it.

Yeah. So was

Cole's the buyer of your

site? No. Kohl's. Kohl's bought it and, and they bought the property next door and they've now got a Cho Cole shopping sign there. Yeah. Right. Yeah. Yeah. So,

so you, we, you weren't advertising it, they just knocked on your door and said, can we buy your site? We wanna build a Kohl's there.

Yeah. So I mean, you need a bit of luck at times, but then I guess if I was impatient, um, 'cause several years earlier I was in the process of selling it. 'cause I found something else I thought better, um, in. Foxville Road, which is now Kumar Town Center. So I was gonna do a similar thing.

Yeah.

But I couldn't do both.

I had to sell one and I had a contract on it for 660,000 probably five years prior. And, and I was gonna buy another property for 300 and something thousand. Similar thing, nine acres Acres in, in the URA town center there.

Right.

Um, but I, then that deal didn't go through. So I was fortunate, but I would've made it on the other one too.

Did you, did you come up with 5.1 or Cole's just hit you with an offer?

I came up with five.

You came, how did you come up with that figure?

Well, I, I, I was paying a hundred grand commission, a hundred thousand commission to the agent.

Yeah.

And I said, you gimme, I need five. That's my figure.

Yeah.

And I'll, I'll pay you.

Good on you. A thousand commission a great

deal.

Right. I mean, the agent still made good money and

so five mil, um. Was any part of that capital gain exempt from tax because it was your principal place of residence for a while, or did you have to pay tax

on it all? No, we had it for a, for a fair, fair, fair time.

And also it was over five acres. So

it was over the threshold.

Threshold. They usually, the, from capital gains point of view, it's gotta be under like seven and a half

acres. Yep,

gotcha. Oh, sorry, yeah, five acres. Sorry, five acres. Not, not, it was a larger site. Yeah, it was one, one title as well. But, but, but, but you gotta remember, you're also

paying tax on five mill profit gas.

Yeah. You can't, you can't go broke taking a profit, they say. But, but I, I'd also had, um, um, monies coming from Resumptions as well. So the theran, the, the, the, the railways department gave me, I think it was around $45,000.

Yep.

From that portion, they cut of the front. And we also found out later that the, the road itself ran through the front of my property, so there was.

By the time it, it ended up being closer to five hectares and six hectares, but was around 13, I think 13.3 acres By the time you, you, you, you're taking the land resumptions.

Gotcha.

But then I got an extra 60 odd thousand, 60, $65,000. So about 185 was closer to 120

Mm.

And when you look at the resumptions Yeah,

yeah, absolutely.

Because that's what, 'cause they negotiate, they give you valuations of what the land was worth at the time and all that. Even though, you know, you think it's worth a lot more and they think it's a lot less. But you, you agree. I figure, um, so I got money, come money was, um, attained

that, that acquisition from the state government.

Did you have to do that first before Coles could have a survey plan of the land?

Yes. Yes. That was all done.

And that was, what was it, a

12, so ninth

period or

when Coles put it, you know, they, they bought roughly 5.4 hectares. Yeah. Or 13.3 acres, not, not 15, like I bought more's advertised. Yeah. Paid by the real estate age, almost 15 acres.

Gotcha.

Six hectares. But yeah, that's how it ended up. So they, they, they were buying at net of those areas that those 2, 2, 2 resumptions.

So the state government had defined the land that they were gonna reclaim and that allowed you to,

well, the road was already ran through it.

Yeah.

I, I, I assume my front boundary was there.

Yeah.

Yet it should have been through the road, you know what I mean? So it was never, if I had have measured it, got it surveyed properly, I guess I would've found out sooner.

Yeah.

But, um,

so you've started off life, um, doubling the value of your house within a year, and then your second transaction, you picked up 5 million.

Well, that, that's out of 15

years. It was a longer period, but it, it's still not a bad deal.

Help, help not being a school teacher. Yeah. So.

Gee, your mates are te still teaching at that time. Would've been angry, wouldn't they?

Yeah. Well, I did remind them, but yeah, that's all right. I used to go and do, um, certain economics lessons at school, teaching about getting into property.

Yeah. My life experiences, what property can do for you if you, if you started young especially and had a, had a go in life. Yeah,

that's a great story. Yes. Yeah. Okay. Well, let's, let's move on to deal number two here. I've got the address as 4 73 to 4 77 Gisston Road. Gisston. Yes. So rather than a, a rural to a commercial rezoning, this one ended up being a rural site that went down the residential development path, but you didn't actually do it.

Um, can you tell us about the deal?

Yeah. Well, this one was a, an opportunity was presented to me by a friend as well. Um, in this case, like yourself, who, um, thought it'd be

an agent.

An agent, your friend who said. This could be a good site for a, for a childcare center because it, it was earmarked also the same as the other property in Ormo as a future urban, even a commercial footprint for the town.

A little a town center going in on this property.

Okay. In,

in this proximity. So, 'cause it was, it was right next to the Gilson Hall. Um, and they regarded that as the, the center of, um, Gilson, if, if you can call it,

well it was the land size gas.

Um, it was approximately 11,000 square meter. That's 1.1 hectares.

Yeah.

Um, it was in three titles. So it had a house, um, a three bedroom brick and tile ensuite at house, um, with the double garage, um, on the middle block, which was a much bigger block, uh, like a battleax type block.

Okay.

And two other blocks on the other side of the driveway. Um, fronting the road.

Yeah.

Um, as well, which were roughly half an acre each.

So all up there was about a one and threequarter acre block. With the house. Yep. And two half acre blocks, uh, already titled, you know, like three lights. Um, which,

what, what sort of zoning was that at that stage? Was it rural?

Rural? That was rural.

Okay.

Which attracted me to the site initially because I was thinking of my two sons down the track, and I thought to give 'em a helping hand, I give them a block of land each Correct.

Sense, you know, and I can keep that 'cause the rent was from that property.

Yeah.

If I just fence that off, they could get a good start in life. It didn't end up that way, but, you know, that's, that was my way of thinking until I took 'em out there and they said, I don't wanna be, don't wanna be here

with the cows.

I don't wanna be out here. Why I live in guilds. I'm going, you serious? Yeah. So, but then my mentality changed down the track.

So I've written down here, Gus, that you, you, you bought that one for six 50 ish and you sold it for 1.7 million. So how did that happen and what sort of timeframe and did you add any value to it?

What actually happened?

Yeah. Well, um, yes. Six 50 was the price we negotiated initially, which was. I thought a good price was below, below value

as

usual. Originally, they, they had a buyer at 800, um, at the auction they're gonna go through and ended up getting it for $150,000 below that. So it was just, I just bought it after, just after the auction.

So

do you know what happened? Like how can someone size number? I, I wasn't,

I wasn't at the auction. I was only telling, I'm only saying what I was told because Yeah. Okay. They said you'd need to pay 800 to get this to go over was it was a deceased estate again.

Yeah,

another deceased estate. But, um, that I negotiated down a six 50 for a quick cash sale.

'cause um, yeah, that was what happened on that one to get the purchase at that price.

Okay. Very good. And what was your plan? Like, just keep it forever for your two kids and

Yeah. Well I, I could see there was, there could be some future development there, you know, with um, it being in a possible commercial zoning.

Yeah.

Um, yeah. Uh, there, there were issues there 'cause there was, uh, in terms of infrastructure, there wasn't town water and sewerage going to the actual property.

Yep.

Um, and to do a development, you need to get it from somewhere else. Yeah, yeah. Right. Farm it in. So, so

it would've been too expensive to connect all the utilities there for three little blocks of land.

It just would have made sense. The numbers.

And the person next door who had control of the Gilson Hall was very anti-development. It was a a, a local, they would've protest it and, and they protested and they were very anti, even though her son was one of my best friends, I had a school with, which didn't make sense, but she was very anti any development.

So regardless of, I, I knew her son didn't make any difference. But, um, and I could gift them things, but no, not interested in me giving them any, any, any upgrades at the hall and all that. All these things. I tried though. I was hitting a lot of brick walls with the neighbor. 'cause that's where I needed to get the services from.

Through that, around that property. Um, the, the sewage and the town water.

So what, what triggered you to sell the site and how did, how did that happen, Cass?

Yeah. Well, I, I'd done some feasibilities on the site, been at pre lodgement meetings and seeing what the, the, the, the best possible use of land would be there.

And, and I went down the residential track 'cause that was what I knew more about than the commercial side. Yeah, a bit different to yourself. So, um, and I could see you could potentially get 17, 18 blocks of land on there. That was with a street going in into smaller blocks of land.

So 11,000 divided by seven.

So you're talking like six or 700 square meter blocks or something like that?

No, no. Well, you need to put braids in there as well.

Oh yeah, yeah.

Gotcha. And also one blocks would be used for the sew treatment works and all that. So Yeah, you took, some of the blocks were as small as four under square meters.

Okay.

Like they, they would approve, they, they indicated they would approve that the council in our pre lodgement meetings would go for, so

you had a pre lodgement meeting and then you had your architect or building designer. Draw up some plans.

Plans, yeah.

But you didn't go ahead and actually no. Go through the approval

I had, um, town planners had virtuals do, do a subdivision.

Everything, everything was done. I got the approvals in, um, to, to, to proceed. Got the neighbors potentially to agree with me as well, um, apart from the lady next door. Um, and unfortunately I went through a, a health event, um, during this phase about sort of nearly nine years ago. Um, I had a heart attack and had to be revived several times, like eight or nine times.

So I was more than 10 minutes. Um,

I didn't know. I knew you had a heart attack.

Yeah. Yeah.

You were riding your bike.

Yeah, I was at 160 kilometer, um, cycling event, um, in north of Noosa. And um, anyway, I crashed and yeah. Pretty, it had to be revived several

times. I thought that you just had a, a minor heart attack and you went to hospital and they said Take it easy for a while.

I didn't know you had to be

revived. I was in an induced coma for a week. Yeah. Wow. On Sunshine Coast University Hospital. Um, yeah. I don't rem don't recall anything for that whole week, which, yeah. Right. Yeah. After that my life changed in terms of the, my way of thinking and I even Yeah. Had a brain injury out of it.

'cause he went without oxygen for over 10 minutes. So some people don't come out of it. They're like, he could be a vegetable. So that I saw life at a different light. In terms, do I,

so obviously you've, you've, you've fallen over in this race. Was it one of your competitors that was behind you that stopped

or, yeah, I had a couple of doctors that were in my group.

Yeah. Right. And they've kept me alive. And then another guy came along that stopped. Um, as well. And he was a lifesaver at, on the Sunshine Coast, and that's why I had 11 cracked rips, um, as well. So he,

yeah. Did you hit him back

later? Yeah. Yeah. Yeah. Well, he was the reasonably I was, I'm here today, but, um, so I still keep in touch with him every year 'cause, uh, yeah.

Right.

And he named his son Gus. Yeah.

Wow. I've known you nearly 20 years and I didn't actually know the full story there. That's, um, thanks for sharing that, Gus. So, so that happened to you whilst you were about to pay an application fee to the council to lodge all this application, and then you decided that health and living is more important and you decided not to go down that track.

So did you then appoint an agent to sell it? Is that what happened?

Well, I, I, um, I didn't appoint an agent. I thought I knew enough to the market of what, what it's worth. Okay. And, but I. I certainly got it out there with the agents to gimme ideas of what each block of land, if I sold the three blocks as they were with the one with the house.

Yeah.

And they gave me a figure of what they're worth individually, which I thought would be the best possible, or an then global option where, you know, the possibility of a, a a, an 18 block, 17 block subdivision depending on which way you want to go. Um, and, um, I came up with a figure net to me 'cause I, I didn't have to pay an agent's fee.

Yeah.

But it, and it was 1.7. 1.7, it was roughly a hundred thousand dollars per block, you know, um, but without a da. So this was just a, an indicating, um, of what could be done on the property, depending on what somebody wanted to do. Um, and,

and you got 1.7?

1.7. My hand. Yeah.

And just curious, like when you did your numbers, was that figure of 1.7.

Um, with a, a feasibility there to have 17 or 18 blocks or whatever it was, was that way higher than if you had it just subdivided into three blocks?

Yes. Yeah, I was told that I could get, for example, on the two small blocks in the, somewhere in the vicinity of three to three 50 back. Um, and then, you know, with the larger block, funny enough, not that much more, um, you know, and it was virtually

so you might have only got 1.1, 1.2 if you sold three blocks, but 1.7 Yeah.

For the potentially the, the more,

yeah,

more sites

it made more, more, more sense. Go there tr down the track. And this was around the time where the mar. What happened in the market where the price just boomed after that. Yeah. Right. This was, uh, at that time where timing was essential, and this is where prices went up substantially and, and costs of building of course, as we know, you know, um, in this timeframe.

And the, the developer who bought that from you, did they, did they do what? Yes. Did you propose They went and built the lots

and 18 blocks and they sold them and made a very healthy profit. Yeah. Okay. I was selling from the cheapest block of land, um, was 5 85 and some blocks.

Oh, wow.

Some blocks were even up to 700,000.

Wow. Okay.

So yeah, I, if, if I didn't have that, that health scare, I guess. Yeah. Um, and had it done it myself, even done a jv Yeah. It would've been far more profitable, but I still made a profit. I still made a million plus. Yeah. Um, after tax.

Okay. So I wanna talk to you about, uh, different options with land.

Uh, investment because I haven't got a lot of experience with subdividing land, but you've done a lot of deals. So the way I see it with land is like you can choose as the developer or the investor when you wanna sell it, obviously. And stage one, the lazy bit is, is just a land bank hold onto it and over, over time, let the market do its thing and prices go up.

And, um, you can sell the land at a profit down the track. Stage two is you can get those land entitlements done by going to council and actually lodging an application and getting approval to subdivide into multiple lots, which provides an uplift in the land. And a lot of people do very, very well just going.

And doing that, just buying land, getting a DA, and then just flicking it. And you see, even on the Gold Coast here, so many, such a high percentage of sites with das just never even get built. But people have profited.

I've done that myself as well, where I've sold with a da, uh, a couple walks in Southport.

I've bought two houses

Yep.

Side by side. And, um, got an approval for 11 townhouses. Um, and somebody approached me that I knew in the finance industry and wanted the, wanted the site and asked me, how much do you want for? And I just threw a figure at him. He says, I'll buy, I don't have to wait nine months to get to go through the whole process.

He wanted to go and do it straight away.

Great. So there's a second example that you've actually added. I've done value, I

done that as well.

Yep.

Yeah. Yeah. It's hard to remember with my brain injury, but there's things that have come back to me and I recall that I've done things like that as well.

Awesome.

So in, interrupt me again if, if you've done one, the next one. So the next way that I see it anyway is you can. Instead of just land banking, instead of just getting the development approval for the land, you can actually go in and connect all the services, build the roads, connect the um, NBN electricity, water, sewer and all that sort of stuff.

And then just sell the land off once you've got separate titles. And then stage four if you wanna go, the whole whole route is you can actually build houses on the thing and sell house and land packages. So do you have a view, like you've obviously done the first couple, well you've done, you've done full ground up construction Yes.

As well. So you are much more experienced than me with all of this ground up construction. So what's your view on those different stages and when you should just sell, but just from land banking versus getting a DA in flicking versus connecting utilities and flicking or going the whole full mon ground up development.

Do you have an opinion on that? And can you talk about what times and a cycle you might have a different, um, exit strategy if

you like? Yeah. Yeah. I personally think you, where you are at what stage you are in life, I guess when you're younger. I found I was more aggressive, um, and I could conquer the world and, and have, have a big crack at life, you know?

Yeah. And really make a difference. Um, so I would certainly would go to the fourth one, do the whole lot, um, where I'm going from rural land to getting an approval to, to, to you all the services there, to building new houses or townhouses or apartments, whatever it may be. Um, when I was younger, I was certainly more aggressive and I, I would go for the, the full monkey.

I would go for the whole lot.

Can I clarify that? W would you do that by yourself or in a partnership with someone more experienced or with someone offering skill sets?

Yeah, I think, me personally, I didn't have a building background, so I went into a partnership in my case with somebody. Was in the building industry and knew that area a lot better than me.

Yeah. And where I was more in the buying the, the, the raw land and the, you know, it had been a good position at the right price, but, and also on the selling side, 'cause I had a, a real estate license as well, which I could u use my services in the saving them on the commission side, I guess.

Yeah.

So we, we controlled the whole facet of the, the whole process.

We, we controlled the, the, the process built of, of getting a, a raw bit of land to developing it and to selling it. So we controlled our destiny basically. We didn't cross our fingers and hoped that somebody could sell it to that price. Um, or whatever. 'cause we wanted the prices to be kept to a certain level, so it didn't affect the valuations.

'cause we, you know, as you might, you may or may not know that, you know, once you, once you sell your first view, you'd you more or less setting the market.

Setting the market.

Yeah. You know, and, and, and that, that's valuation know when somebody,

that's why it's only the last one that

you discount, you can discount As long as you're not doing another development next door, you don't wanna go down that path.

But certainly you, you want to reach knowing that you want your, your 20% margin, for example, that you, you're gaining for or, or more in some cases if you're, you're more involved with doing the selling process as well. But, um, yeah,

the reason, the reason I say that to the li for the listener's benefit is there's probably lots of people wanting to get into property development that are scared.

Like, like you should be if you dunno how to do everything. But Gus wasn't the builder, he. Was good at acquiring, let me tell you. He's extremely good at finding good deals and finding sites, and he also had the ability to sell them, but he's teamed up with another gentleman who had the building expertise to cover that gap and that gave him confidence to go out and do deals.

Yes. And none of us are good at everything. So it's about the team, isn't it, Gus?

Exactly. Yeah. And you've gotta make it worthwhile, both parties. So it's, you've gotta go in 50 50 because you've gotta make it worthwhile to both parties the minute you start doing 60 forties or

Yeah.

You know, the other person loses interest.

So you, yeah.

How, how did you, getting off the topic of the, uh, the agenda here, but were all your deals done through one construction company, would you set up a separate entity for each lot of townhouses that you built with the builder?

We, we did it through one entity.

One entity the whole time.

Okay. We had a, we had a common company based 50 50 shares as, and it just.

Without, with us as directly. Gotcha. Yeah. Okay. And I guess some people may not do it that way. There's more exposure if something goes wrong.

Yep.

But yeah. Yeah, we, we, we were fortunate. We, we had a good run with that sort of side. We didn't run into difficulty, but, uh, and when we eventually split up and did our own thing separately, was very amicable to the point where I, I had lunch every week with him, with Jack that week.

So yeah, we, we, we were still best of friends.

Fantastic.

Um, so yeah, we didn't, yeah, sometimes it is a divorce type thing, but, uh, yeah, it can work out in some cases.

Okay. Awesome. Gus, thanks for your knowledge there, mate. Um, deal number three, uh, 49 Brighton Street, bigger waters. You've, um, you've bought a block of units, uh, renovated it and sold it with a 33, not a 20% property developers margin, but a a 33% renovators margin all within one year.

Yes.

Can you talk us through the numbers? I haven't written down how much you paid for it and sold it for,

in that particular, um, that was a, an existing block of nine brick and tile, three story walk up block of units, um, in one block from the beach. You know, bigger waters there.

Yep.

Um, so the property behind it,

the broad water, not the beach,

sorry, broad water.

There is sand there. A bit of sand, not, not surfing beach. Um, but it's, the properties are backed, backed onto, were actually fronting, um, marine parades. Okay. They had the view, so there was a bit of eclipse of some water glimpses Yeah. On the upper floors, apartments. But, um, yeah, I saw an opportunity there where having just developed new properties up until then and, and the raw land long-term scenarios that we talked about as well.

Um, there was a bit of a gap between secondhand properties or established properties.

Yep.

Um, older units. And New Years. I knew I had an idea what the news would cost, you know, and how they come complete and how they, um, they predominantly, well they pretty well all came with en suites. Um, and that was the biggest hurdle I thought, how am I gonna make this compete or get to that level where I can try and value add as best I can with the floor plan or the footprint that I've already got?

'cause I can't really increase, I've got nine titles here.

Yep.

That's, that was one of the reasons I bought it. So I had nine title, so I didn't have to approach council.

It wasn't all on one title,

so I didn't have to approach council with, so if I was gonna build something

Mm.

Um, or add on, I'd have to, you know, or, or if there were a block of flats that would go with the today's code that, that current year, you know, not, not 20 years earlier when that built.

So I, I can't take something from you. I've already bought

Yes.

Like a Title D.

Gotcha.

So what I did was I looked at the footprint and engaged. A building mind, a builder to come and have a look with me. Um, and we could see there's an opportunity there. We could create an en suite out of these, each property, each unit.

'cause they were all through identical floor plans, you know? Um,

this is did, this is June, the due diligence you brought your builder mate into,

just to have a look. Yes,

yep.

Yes. Get a look. And he, he ascertained that we could, we could make something work here. You know, we could take out this wall or take out this, this cupboard and we could create a, an en suite.

And I'm going, I could see dollar signs. 'cause I'm going, well this is gonna improve. This is what I wanna do. 'cause I wanted to not only gut the units, so brand new bathrooms, kitchens, everything, you know, except we just kept the, the shell. Um, but, um,

were they originally nine two bed, one bath,

two beds, one bath each,

and you turned them into nine, two bed, two baths?

Yes. So they all had on suites,

but you didn't need council approval, but you would've had to fill in a form,

would've had to, plumbing, would've had the plumbing side that cost a little bit. Yeah.

Yeah.

Negligible. Compare it in comparison, what you, you add the value to Yeah. Right. To, to eventually. But um, so we created, um, uh, a two bedroom en suite apartment.

And they all had lockup. I also gave 'em all lockup garages. They, they couldn't have underground 'cause it wasn't an underground set up, like back in the day. Yeah. But the got block was so big that we had nine lockup garages at the back of the block, at the, uh, the rear of the site.

So, so how long did it take you to do that renovation, gus

at?

Oh, you didn't do it, your mate did it.

Well, I engaged the builder.

Yeah.

But I was on site every day through the building process.

Okay. You're

involved. So I was involved in all the trades, people coming in and out and what I wanted and what I, I got approval, you know, to to, to it, to be developed into, okay.

So I, uh, more or less paid him a fee per week to use his license, but I was there.

Supervising

license

and you have to too.

But he had to, he had to sign any, any work over a certain amount of money. 'cause if he had the building license,

yes it is.

But I paid him a fee every week just to use his license. But that process took approximately six months to to, to renovate.

Yep.

The whole block. 'cause it was all replicated. The, they weren't the biggest of units. They were approximately 90 square meters each.

Okay.

90, 95 square meters and plus a little balcony on each one. Or a courtyard. We created courtyards and the three bottom ones as well. Um, all nicer landscaped. We rendered the, the, the bricks.

We, um, yeah, it, it, when you looked at it, you, you thought it was a, a brand new block of units.

Can you summarize the numbers just in, in rough numbers? Like what did you, what did you buy the whole nine units for what price?

Uh, purchase price was negotiated down to 1.35.

1.35. Nine,

one 50,000 for each unit.

150,000 each,

each unit. Okay. You wanna divide that by nine?

Yep. Yep.

Um, and in total, the total renovation costs from staff to finish.

Yep.

Everything was $450,000. That's with me being involved and hands-on managing all the sites

divided by nine is 50 grand for each unit.

50,000 per unit four? Yes.

So purchase 150, you spend 50.

So each of the nine units owed you 200?

Owed me 200.

And then what was your exit strategy, Gus,

in terms of sale price?

Um, you

sell

them all?

Sold them. Individual. I, I sat on site and, uh, advertised them as an agent, you know.

Yep.

Sold them, sold them myself. Um, and, um, the, um, the, the prices were in the high 200, some in the low three hundreds, but say an average of about $300,000.

Okay. Per, per property. And, but I didn't, I was advised. Once hit the sixth sale to slow down and, um, stagger 'em over the next financial year. So not to pay as much tax.

Gotcha.

Because I was then looking in the process of buying another site. You know, you, you just, you have continuous to balance as

part of tax planning.

You trigger some before 30th adjourn and you made the rest after one July

contract dated first July. Yeah. Or thereafter. In some cases, if you can do it that way. 'cause there, it was a, at the time there were active buyers around and people were being brought to me, um, on site or most cases people just walking in off my signage.

Yeah.

So 33% profit, so it cost you one 50. You spent 5,200 a lot. You sold 'em for 300. That's actually, that's 50% profit. You made a hundred, but you only put in 200 fees. You made 50% profit.

50% if you wanna call it that. Yeah.

That's, um,

that's in 12 months.

Yeah. That's unbelievable.

Yeah, I was. Fairly proud of that development, you know, 'cause it, it was the first one I did on my own.

Yeah.

After my partnership arrangements with the building, the new, new developments. Yeah. So that sort of stood out to me thinking, wow, you know, I didn't have to lean on anyone, you know, but I'd gained a lot of experience from my building.

Mm-hmm.

And, and selling other projects previously. Yeah. Um, with, um, new developments.

But, um, and I, I did that with a few other developments after that where I bought more box of units and the stratum title and did the same thing. So

I said at the start of the podcast, 33, 'cause I was thinking a hundred out of 300 selling price is one third, but it's actually 50%.

Yeah.

It is a hundred on 200.

It's 50%

margin when you look at 200 as a base. Yeah.

That's, um, incredible. Like most developers are happy with 20 to 25, aren't they?

Yeah, I was, like I said, I was. Fortunate that I could, had the opportunity to create an en suite

mm-hmm.

At added value. 'cause then you people could see it. Wow, this is like a new unit.

Whereas if you're buying a, a two bedroom, one bathroom thinking, oh, this is an old unit, you know? Yeah. You don't, you then can compete when the new units were selling for, let's say a time around three 30 to three 50, so I kept it below that.

10%

below. Yeah. Below it. And yeah. And, and, and, and buying 'em in that price and being involved in the redevelopment process.

Um, it certainly, um,

was all of that uplift there Gus, due to your skill of, um, doing the renovation and recognizing the market? Or do you think once again, when you bought that site for 1.35, do you think you bought a bit of equity there? Did you buy that really well at 1.35? Do you think maybe that was under market when you bought it?

I thought it was good value for money,

yeah.

But it probably was a little bit under value, but I think it was close to the market. Might have been worth maybe closer to 1.5. I thought it was very in a good location, being near the water.

Mm.

Um, and also, um, being Strat, a title,

they already had separate water meters separately already Strat a title.

And I, the, the good thing was I didn't have to negotiate with nine different owners. One, one company, like a superannuation company owned them.

Oh, right.

So that made life a lot easier.

Yeah, yeah.

Absolutely. If you underst if you can understand that.

Yeah.

If you're buying a strata title, um, block of units, you normally are negotiating with a number of different owners.

Yeah, that's right. But I was, fortunately, I negotiated with one owner, so, um, it made life a lot easier and cleaner and, and quicker, you know, 'cause it, in some cases, you, it could take, it could, could, may never, never come off. 'cause only need one person not to wanna sell. You can't do it.

So a hundred grand per unit times on, so you made 900 grand.

That's, uh, again, probably more than your, your salary as the teacher, I guess.

Just a tad. Yeah. Yeah. Which, super included. Yeah.

Okay. Last deal. Um, this one, um, I'm fairly familiar with. Uh, I was the, the selling agent. It was a mortgage in possession sale, 18 Eden Cord and Aang, uh, a luxury or a very large luxury single level house with a massive curl and four modern townhouses.

Um, we can both talk through this deal because I was involved with it, but tell us, uh, tell us how, how the deal happened, Gus.

Well, it started with a phone call from you. Um, tell me that there was a property going to auction, uh, which I attended, and, um, and it didn't sell as you owe at auction. Um, the reserve, I think you said was

3.2.

From

3.2 million.

Mm-hmm.

Um, which, yeah, didn't. That didn't excite me that price, but you know, it was probably fair. Well, well there was a lot of property there. There was four, three bedroom ensuite at townhouses. Yep. Uh, as you know, um, and actually two of the bathrooms were en suite, aren't they? So it's, it's got three bathroom, they got three bar.

I think they had three.

I remember now.

I think they're three bathrooms. Yeah. So they're three bedroom, three bathrooms.

Yep. '

cause the downstairs one had its own bathroom. Yes. And, and one of the upstairs one was ensuite as well. Um, and there's another bathroom upstairs as well. So three bedroom, three bar.

So you're talking three 12 bedrooms in, in the townhouses.

Yeah. Yeah.

And they were only a couple of years old.

Yeah, they were modern. Yeah. They were

only a couple of years old. Um, and the house was six bedrooms. Yeah. And quite a big gymnasium. Big pool.

Yeah.

And a big chunk of land. So it was almost an acre in total.

Yeah,

just under an acre. Um, and, um, I, I just thought. As an income stream. 'cause this was just after my health issue. Um, when I sold the Gilstone property we talked about earlier. I wanted to park my money to something else and I thought this, I, I, I could see, rather than taking a punt with something and going through the whole risk process of developing something.

Mm-hmm.

I just, just wanted a a, an income, an income stream of why do I have to go and go through all this? I'm not a young man as I used to be, um, uh, um, at the stage. And I'm thinking, well, I should look for something where it's giving passive income. And I went through that process and most residential properties I could find were five, six, 7% not of gross.

Gross.

Yeah. This one was showing a bit more

about eight points,

something.

Yeah.

Um, and I could see there was even potential for more there that down the track, you know, if we could find the right tenancy.

Mm-hmm.

Um, that, that, um, because the property was originally geared. For, um, um, a rehabilitation type center where they, they could set up pro people and properties and, and there was the potential of maybe down the track we could look at something like that, where you could po possibly increase the rental return by having a more specialized tenant.

Yeah. That would maybe even look at renting the whole premises, you know, all, all 18 bedrooms, you know. Um,

so you didn't, um, buy it at auction. It didn't sell. And, um, what happened after that? I'll, I'll fill in the, the blanks. You gimme something. Okay. Well, I'll tell you what happened. So I, I actually dunno the full story, but what hap actually happened was the morgaine possession rang me and said, Andrew, uh, we've got a situation here.

We need to sell this within 48 hours. I still don't know. What that situation was, can you get me $2.5 million for it? Now remember, I'd just been given a reserve price of 3.2 million on this site. I thought it was fair value or that, and I'm extremely confident that that 3.2 million would've been based around a professional valuation.

Usually a bank or a mortgaging possession would pay for a value or to value or property to come up with a reserve price. And I think 3.2 was probably fair value. Now, when he said 2.5, my immediate thought was, I've gotta buy this thing myself. But I just wasn't in a position to to fund it. So I thought, which one of my mates can I help make 700 grand today by signing a contract?

And you are the only one I rang because you'd already made the effort to come and have a look at the place. If I had have rang someone else, they would've requested an inspection and give 24 hours notice to the tenants. It would've been too late. You are the only person I rang, and you had the courage.

To meet me the next day in a McDonald's in AU I think it was, and sit on the at Maccas and sign a contract the next day for 2.5 million cash, 700,000 under market value.

Mm-hmm. Yeah. Lucky I don't, I might like you to help to, um, gimme that phone call. So,

well, well, partially yes, but what I wanna say to the viewers is that people talk about, you know, a once in a lifetime deal, Guss, you've done plenty of them because you put in the work, you go to the auctions just in case something's gonna be a deal.

And if you hadn't have gone and put in the work and attend that auction, which you thought afterwards that night was a waste of time. 'cause it didn't go for the right price. Because you put in the work, you find the good deals. And I've been myself when you were very active many years ago, 10 or 15 years ago, I've gone to many, many auctions.

I walk in there and look around and there's Gus fell. So you probably. You haven't done the numbers probably, but you probably sat in a hundred auctions before you find one deal of a lifetime and you've bought heaps of them.

Mm.

Because you put in the work and you do the due diligence, you know what the other comparables have sold for, you know, in your mind, if I can pick this up for X, that's a great deal and you're extremely good.

You're passionate about it, and you put in the work.

Mm.

And that's what I want the viewers to know.

Yeah. Yeah, that's true. I, as my wife will, will tell you, I do spend a lot of time in checking on real estate.com or, or yeah. Just through word of mouth or finding out information, what's going on in the marketplace.

So, and, um, it, it pays to stay ahead of the market if you can, and, and, and if something comes up at the right time, the right price, and you can pounce on it. And, uh. Might have had regrets later. 'cause you didn't, oh, I, I took a bit of, too much, too long do my due diligence.

You, you have the courage, you'd done the due diligence.

I rang you. It was literally the next day we met at McDonald's there with, with your partner and we signed up that contract, 700 grand under market value. And a lot of other people might've been too scared to sign a contract like that. But you, you were confident in the site, you'd done your due diligence and you had the courage to go for it.

Now, since then, like the rents at that time were about 200 grand a year on that 2.5, which is probably an 8% gross yield. And over the last four years that we, we've managed that property for you, you've managed to increase the rent property, what, another 50 grand a year?

Yeah, it's, um, yes. Earning maybe quarter

of a mil,

adding, earning about two 50,000,

10% gross.

Yeah. It's around 10% purchase price that that was, yeah. For four years ago.

Yeah.

Um, yeah. And, um, been fortunate enough to find a, a tenant that. Is in an industry where they are seeking more accommodation elsewhere. And if they can find it all around that one property where they can use the swimming pool and use the gymnasium and all those facilities there, um, and have an office there, um, it's worked out better than that.

I first thought that whereas now with, with now getting a high yield where they now lease all, all five or, or five of the properties, five properties and, um, would do anything to stay there? I'm, I'm getting the impression, you know Yeah. If they're in industry, they're in the NDIS industry.

Yep.

So they, um, obviously

getting the government

incentives, government incentives to, to fund it and, uh, have a, have a, seem to be a very successful business.

So as long as that business stays successful, which it should, um, and NDIS is still there and the government doesn't decide to change the rules on it. Um. And they'll be, we'll be expecting increases in rent over the next few years as well. You know, does

that mean my management fee goes up? So Gus

talk

later.

You, you drove a very hard bargain on that too, by the way, but you're, you're a really good negotiator, Gus. But look, what I want the viewers to you really learn from, from Gus's experience here is not only did he buy 700,000 under market on day one, he's now getting a 10% gross yield on the purchase price.

250,000 rent from 2.5 million. And now there's more to come because Gus has through his own, uh, experience, um, found out a potential way to subdivide some of the footpath there, which has a big chunk of land on it to build a six dwelling. Now this hasn't been approved yet, but if Gus pulls it off and it's likely he will, he'll get a six block of land for free, um, to build another dwelling on it.

Can you tell us. Your intentions there And how's that going, Gus?

Yeah. Yeah. Well it's going through the, um, had several pre lodgement meetings with council already.

Mm.

And they've indicated yes, it's something they would entertain, uh, as long as certain conditions are met with the, uh, infrastructure that's existing under there.

So we have to, um, um, do a little bit of work on that side. But the land is approximately 500 square meters, um, of land at the front, fronting the road. So we've got road frontage.

Yep.

Um, but the services, everything's there. It's just a matter of making it work. And we've got a house already built, um, sorry, designed for the block Yep.

To, um, and they've, they've given this, the night on that, so it's just a matter of having the right setbacks, um, and um, yeah. And making, going through the process and

mm-hmm.

And, and getting council approval. But there's, there's really only one neighbor who you sold to. Yeah. He sold the other house to 'cause

Oh, number 16.

Yeah. He's the only neighbor Really? 'cause there's nobody else in. The close vicinity. 'cause the properties across the road are, are rent an estate. Um, so yeah.

So part of that approval, I'm guessing might be to build some sort of acoustic fence, um, behind your house to separate a bit of the noise and then you'd have some, uh, infrastructure charges to pay for a new house.

But it's not gonna be substantial.

No.

You've basically got a free block of land there, um, because of you thinking outside the box. Yeah.

Why

let's hack, let's use this land that's just sitting there.

Yeah. Well, originally I was thinking, um, I've helped out one of my sons, um, and getting a property, um, his first property.

Um, and my, and my other son, he, um, he also is' in that age group where he should be looking for a property. But as you know, the market conditions are pretty tough for first home buyers, especially on the Gold Coast. We now rated second highest in Australia after Sydney. So, um, and I'm trying to, trying to help him out with that.

Ham land possibly also for him. And it is his first home, you know, to build a house there. So that, that sort of thing. These are the sort of things you think of once you go through a bit of a health scare or not even that, you just wanna help your kids out. 'cause at the end of the day, you can't take it with you, you know it's gonna be theirs one day.

You might as well have, have a say in what, what, what, what they're getting, you know?

And you're teaching your kids

Yeah, exactly.

About how to add value.

Exactly.

Yeah.

So it, it all, it all um, makes sense to me that it's a natural progression of, um, copying my, my, my sons out as well. Getting, getting their first homes.

And, um, and

guess I, I've already, um, come to the conclusion towards the end of this podcast that I need to, um, somehow con you to come and do another one. 'cause I'm sure that we can. Yeah, provide a lot more really good lessons to the listeners on other, maybe maybe just do one focus on what you've learned about ground up construction with your building your townhouse sites and selling them off, because I'm sure that they'll learn a lot from that.

'cause we haven't really gone through that today. No. But, um, these, uh, there's, there's four awesome deals that you've done, mate, and, um, look, you, you, you were a bit of a mentor to me in the early days from, from, not from an agent's point of view, but from a buyer's point of view. I used to see you come into my office, Andrew, can you manage this property I've bought?

And I'd look at the price you'd find. I'd say, well, is that the real price? I couldn't believe how cheap you buy sites on. And it's because of your work ethic, because you go to the auctions, you look at a hundred or 200 deals to find the deal of a lifetime that you seem to find every three or six months because you put in the effort.

I've never told you this face-to-face, but it's true. You actually were in some part, a mentor to me. When I go out and buy, I, I, I looked up to you as to how rigorous you were at going through all the numbers and turning up to the auctions and, uh, and leaving no stones unturned to find a good deal, because that's what I do now.

So thank you for paving the way.

Thank you.

Um, just a few questions to, to finish up Gus, um, strategy, mindset and lessons for the viewers. Um, what role has timing and real estate cycles played in your success? So when you're buying a site or working out whether you should develop it or flick it, can you, can you answer that question just briefly?

Yeah, well, just that example like where, how we started off our, our. Chat there earlier with my first house. I mean, that was a bit of luck to that. I timed it when the stock market crashed and it doubled in value in 12 months. I mean, timing is essential. If everybody says, let's put our money into real estate, like, let's put money into gold as a war going on, or silver.

Yeah. Yeah. You, it's, it's timing. You've gotta, you

not last Friday, don't have money in yourself last for 30% life overnight.

But timing is essential. Yes, it does help. Um, but sometimes you do after a while when you see how cycles work. That, that there's opportunities that do come up, you know? And if you don't have a go, you never know.

You know, it's, you've gotta make it happen.

Mm.

All right. So yeah, you can sit on the fence or sit in your chair and, and, and look at all go past or go by, but yeah, till you see an opportunity and have a, have a crack at it, uh, as you are doing now and other facets, um, yeah. You, you can make it happen too.

Yeah, for sure.

Thanks guys. I think we've covered, uh. The importance of relationships, um, you know, the 700,000 under market, your relationship with, um, your builder friend, um, I guess you had a team of, uh, town planners, uh, and, and things as well that you work with that. Yes. Uh, are there any other stories that you'd like to tell about how important it is to have relationships like real estate investing?

I, I believe, is a team sport. Not just, it's not just you, it's, it's sort of a team. Have you got any other examples of why relationships are important as real estate investing?

Well, it's very important. I mean, a relationship with a real estate, a a good real estate agent is important. If there's something you can't source off market, for example, but

you

can hear you, you don't know about through being, being real estate.com.

Mm-hmm.

So that's, that's very important. I mean, relationships with, um, um, builders. Is very important. 'cause you, you gotta know what you can change this property into or to, to value add if you can do that potentially. Yeah. Um, or, or with a, a town planner, um, that, that can see the potential, you know, on what this site, this ugly duckling could be turned into, you know, and, and the, the profitability of it all get a con, getting a quantity surveyor and getting costed out and thinking, yes, this is a go or, or no, you know, after doing your due diligence, you know?

Yeah. So there's certainly relationships with various people. Um, you need to have, and obviously when you're starting off, you need a good with a bank manager. 'cause you need somebody that wants to help you believe in your dream of, uh, yeah. What you want to create here. So. Or

a private lender.

Or a private lender.

Yeah. If, if you, yeah. Depending on your circumstances.

Yeah.

Um, certainly you need a helping hand. 'cause I certainly needed somebody else's money. To, to start off, you know, I couldn't have done it with my, my, my own money. So, and as I got on you, you're certainly building equity and profit and, and, and in property, um, to, to, um, stand on your own two feet, so to speak.

You know, so, and not leave park ships that you don't have to be in if you don't Gotcha. Necessarily need to be in, you know, um, and, and so it can be more profitable for you down the track, you know?

Absolutely. Can you tell us about a deal that didn't go to plan and like, not just investment, maybe a development that you've done where the numbers didn't come out with your 20 or 30% profit margin?

Guess?

Yeah. Well, one does come to point, um, which I just remembered recently. Um, and that was a site in, in Brisbane, um, in a place called San Lucia, um, opposite the golf course. And we found this property a nice. Older, older home on, on three blocks of land, three on a big block of land, it potentially could be subdivided into three blocks, which, which is what I, what we did.

Um, and by the time we dealt with the Brisbane City Council, which had different heritage rules that I wasn't familiar with, I didn't have that experience down the Gold Coast or, or Tweed Shire where properties weren't necessarily that old. Um, I struck a lot of extra costs that, that in factor in and also with the, um, the slope of the land that needed to be, um, tended to, to, to make it, you know, to subdivide all the conditions of council that put on beforehand

or you're talking retaining wars or stormwater issues

when stormwater and retaining wars.

Yes.

Yeah. And the house was, uh, a pre 1947 or 1957 house that had heritage.

Heritage listing.

Yeah.

So it added a lot of extra costs, which to make it. To move it meant a lot more extra, extra expense, you know? And, uh, so we eventually made it work, but we virtually just got our money back, so there was certainly no profit in it, but we subdivided.

So a

year of your life or a

bit longer? Took probably 12 months. Yes. Yeah. Yes. And uh, uh, and we also, um, drew up plans with architects to, for each individual house on each block of land and get the views of the golf course and all that.

Mm.

But at the end of the day, we just. Got took our money back out of it and moved off for something we were more, we, we felt more comfortable with and knew more about.

That's really interesting because, uh, a lot of, um, uh, property developers sort of on social media say, you really should stick to one council and get familiar with their rules. And there's an example where you've ventured off into a different council and you weren't familiar with the Heritage Homes, for example, and you got burnt.

Yeah. So there, there's always a lesson to be learned.

Yeah.

As long as you don't do the same mistake twice, you never, you haven't learned. So I like we didn't do that again.

Okay, Gus, um, second last question. Um, are there any books that you've read that have influenced your mindset or, you know, your, your strategy around property investing or developing?

Yeah. Yeah, definitely. Um, one book that stands out

mm-hmm.

Um, was, um, building Wealth Through Investment Property by Lee called Jan Summers.

I've read it.

Yep. And, um, yeah, early in my piece, I certainly. Picked up a lot from that. And with the author being an ex school teacher and me being ex school teacher

Mm.

I certainly could relate to a lot of it. And I educated a lot of people that talked to me, uh, at the time. 'cause I was, this is in the 1990s, um, and I made a, made a policy that everybody, anybody bought a property from me through me. I even gave 'em a book. So just to the

Jen Summers book

you gave, I gave him a book at that.

I just,

because you believed in the content?

I believed in the, in the content and the concept. And if you, 'cause a lot of people I, I talked to and, and dealt with were people looking to, um, buy an investment property.

Mm-hmm.

And, um, what better way than learning how it gets other people pay the property off for you

mm-hmm.

Rather than use your hard earned money.

Yep. '

cause you really wanna pay your own house off as fast as you can. 'cause that's not taxed after. Whereas with an investment property, well first you can get a tenant. More tenants moving into the property help you pay it off. And also the government can certainly, depending on how much tax you pay, um, and how old the property is, it's you or you can claim depreciation and all these other factors and, and through your, your, your taxes.

Um, the more tax you pay, the more potential tax refund you can get through, through gearing the property through negative gearing. Um, and potentially you could only be putting in as little as 20 or $50 a week outta your own pocket and other people buying this, uh, help you pay off this property, which eventually will be yours.

Yeah. So I thought, why doesn't everybody know this? Why, why, why isn't this taught at schools? You know,

I gotta admit, that is the first residential property investing book I ever read too. And I was, I was blown away. But unfortunately for me, I bought. In the early 1990s, and we had a pretty slow decade of, uh,

yeah.

Returns at that time. But I, that was the first book that I read too, and it was awesome. Yeah. So she come out with a second follow up book,

like me. She had another one. Yeah. Coming in afterwards. But it was something that I, I, I, um, used a lot and, and, and spread the word. Once I was getting a, any money outta sell, bought, bought, selling the books, I was just giving as a gift just to reiterate what I was telling people.

And, and there's even programs there where you could put in your income and putting the age of the property and, and the rent and everything, and it give you, so you have the after tax tax figure cost. Yeah. So there was even software out to help people get better understanding how Right. To them. Yeah, because,

so you used that as an agent with your project marketing too, didn't you?

When you're selling your units and things, you plug it into the calculator and show people any,

and list them. I mean, they always wanted speak to their investment advisor or their accountant, or,

yeah, of course,

banker. But that was just an, an example of what it could. Could work out to be based on what information they gave me, what I knew about the property.

So it's important for them to know that it's not as much, not a, not a, not as hard as paying off your own home mortgage. Absolutely. Um, as opposed to investment property. So I thought

leveraging the, and

leveraging is very important and, and yeah, everybody should be doing it, you know, at a younger age.

I agree.

Not leave it when it, until it's too late, so it may make a difference.

Final question, Gus. Um, if the viewers in the audience, uh, interested in development, property development, not just long term buying property investments, do you have any, is there any one bit of wisdom that you'd share with someone wanting to start a property development journey?

Yeah, I, I, I guess in my own case, I started off small, so, mm-hmm. Start off with one, one property, be it a duplex or a unit or a house, if you're gonna be renovating or b or doing anything of that, that, that nature. Um, yeah, definitely start small and get a taste for it and see it's f see if it's for you because you know, it, it may not be a cup of tea.

And you can see all these shows on TV where they're renovating or building from you, you know, and, and, and the, the sale prices are far exceed, you know, what their expectations were in some cases. But see if it's something that you can see yourself doing, I guess. Um, and, um, but definitely start small.

Don't, if you go in boots and all with everything too much, you could get yourself into trouble. So you gotta have a, an escape or, or, or, or you know, it's something you are not going over your head. So, but it's certainly an opportunity, um, you shouldn't miss out on.

Thanks for your time, Gus, it's been a pleasure.

Thanks for coming in. I really hope I can convince you to do a second podcast down the track with some of these other deals. Thanks for joining me.

Thank you. Thanks, Andrew. Thanks, Gus. Cheers.

Thanks for listening to the Andrew Wright Property podcast. This is all about building a community of like-minded investors who can share real life stories, experiences, and collaborate with a view to helping each other.

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