Like many a young Aussie, 34-year-old Susie Armitage spent a large part of her twenties resisting the urge to settle down and buy a house, and instead opted to enjoy the moment and travel both overseas and domestically.
With her travels completed (and with her itchy feet well and truly scratched) Susie found herself pretty much penniless, but the drive to own her own home has since seen her buckle down and slowly but surely build up a property portfolio now worth more than $1m.
“I was penniless when I came back. I was living with my family and thought, ‘right I need to buy my own place’” says Susie.
Thinking about retiring
“An opportunity for a new build off-the-plan house in Airlie beach arose, and I seized it. I envisioned a wonderful retirment in the Whitsundays and thought why not by the house now? A little cheeky for a 27-year-old,” says Susie.
With her retirement property selected and signed up for, this cheeky little 27-year-old then set about the task of bartering with the selling agent to reduce the size of her deposit to help her to secure the finances required to turn her dream into reality.
“Within the next couple of months I had to come up with the deposit, but Instead of giving a 10% deposit of $19,700 I just asked if they would take $10,000 and they said yes. It’s always negotiable and it’s important for people to realise that. I then had about eight months to come up with everything else that I needed,” explains Susie.
The deal was settled in March 2004, giving Susie her first footing on the property ladder. And as first steps go, it turned out to be a great start. Seven years on and the property’s increased in value by $162,500 and currently achieves a rental yield of 9.48%.
Buying south of the border
Three years later Susie had built up $100,000 of equity in her first investment property and decided to make that figure her budget for purchase number two.
Deciding to branch out into New South Wales, Susie had a look around online for $100,000 properties and found what looked to be a suitable property in Cootamundra, a small town of just under 8,000 people located an hour northeast of Wagga Wagga.
While Cootamundra isn’t exactly a property investment hotspot, the house that Susie had found online fitted within her budget, and a viewing trip later she’d made her mind up that this “dinky little cottage” would make a sound investment.
“I went up there for the weekend and saw heaps of families and lots of building activity going on, so I knew I wasn’t going to have any trouble renting,” explains Susie.
Refinancing the mortgage on her Airlie Beach property allowed Susie to release some of her equity and buy the Cootamundra cottage outright for $80,000.
In dollar figures capital gains will always be modest on such an affordable property (its value has increased $10,000 in the three-plus years since purchase), but the $150 per week in rent that Susie’s Cootamundra cottage brings in represents an excellent yield of 9.75%.
Continuing into the garden state
After a couple of years watching her two properties grow in value Susie felt she was ready to make a third property purchase.
“I had heard off the cuff about how hard it was to find rental properties in Bendigo and I basically thought ‘I’ve got a bit of money to play around with here’, so I started to look at what I could get down there,” says Susie.
In November 2009 Susie sourced and signed up for a three-bedroom, two-bathroom house off-the-plan in the suburb of Epsom. Completion and settlement took place in July 2010, and the property has been tenanted since.
The $260 per week that Susie’s Epsom property achieves in rental income represents a more modest yield of 5.9% when compared to her other two investment properties, but average annual growth for houses in the area is a healthy 9% according to RP Data’s January figures and Susie estimates that the house’s value has already gone up by $31,000 since completion.
A home of her own
With three investment properties under her belt, Susie decided that it was high time to buy somewhere to call home. Now based in Canberra, she found a three-bedroom new build property in the suburb of Macgregor that took her fancy, and earlier this year Susie left the tenant life behind and finally moved into her own home. Being new to the demands of being a mortgage paying owner-occupier, she’s in no rush to jump into property purchase number five just yet.
“I think I’d better sit tight for a little while. I guess I just need to get used to having a mortgage here. Although I’ve been paying rent for several years and there’s not much difference, I just want to see how I go juggling the four for a little while,” she explains.
Susie’s already setting her sights on owning her Canberra home mortgage-free in the not too distant future. She’s tentatively set a timeline of 10 years to reach this milestone, and admits that she may have to sell one of her investment properties in the meantime.
Of course, one property that she won’t be sacrificing is the Airlie Beach duplex, and the way things are going she’s well on course to turn her dream of retiring to her own home on her favourite beach a reality.
