Investing across continents

By Jacqueline So | 09 Jan 2020

"I don’t have a particular number of properties or a target income I’m looking to achieve – as long as I can keep investing in property, I will!"

Like for many investors, the idea of investing in property first came to Hemal Mistry as an alternative to living the typical salaryman’s life. However, it only became a serious pursuit a few short years ago.

“I’d been working in IT in the UK and Australia for 12 years, and I hit a point where I couldn’t see myself going through the same nine-to-five routine for another thirty-something years,” he says.

“However, I knew my financial needs would only increase in the future with children, university fees and the like. So I started searching for ways to build wealth to give me more security and, more importantly, the option to pursue another career.”

Having first lived in the UK, Hemal had maintained his residence there as a rental property after moving to Australia. It only hit him afterwards that he had an investment property on his hands – and he was now a bonafide landlord! 

“The rental income I was receiving was greater than the expenses, and the value had also increased. That’s when I began looking at investing in property here in Australia."

Nearly 10 years after buying his first investment property in 2009, Hemal began his real journey as an Australian property investor in 2017 with a house in Queensland’s Kallangur. Electing to follow a buy-and-hold strategy, he sustained the momentum by quickly acquiring three more properties in Kippa-Ring and Petrie.

“I found established properties, renovated them and then pulled out the equity to use as a deposit for the next one. With this strategy I was able to acquire four properties within a year,” he says.

 

 

 

AT A GLANCE

Years investing: 10
Current number of properties in portfolio: 7
Portfolio value: $2,111,000

 

 

 

 

 

All about balance 
In time, Hemal noticed that his investments were cash flow neutral, and his portfolio needed a boost of positivity to balance things out. Thinking about the successful returns achieved with his UK property, Hemal made the decision to plunge back into overseas investment.

“It occurred to me that it doesn’t matter what country you invest in; a market is a market regardless of where it is located.”

He noted the considerable returns that could be gained from renting out homes in the US, and decided to try his hand there. By this point, however, Hemal’s equity was inadequate to support the purchase of another investment.

“I researched how to use my super to buy property, and I set up an SMSF. Then I purchased two positive cash flow properties in the US. This way, I achieve much higher returns of between 16% to 19% net yields, which is better than any super fund I’ve come across. The capital growth will be the added bonus and ultimately increase my retirement fund further,” he explains.

“When the US market has risen significantly, I’m looking to sell them off, which will enable me to purchase another two or three properties in another rising market.”

Hemal has his eye on buying another US property, this time outside his SMSF, in order to further support the rest of his portfolio while he waits for the long-term capital growth of his Australia properties. This would leave his portfolio in great condition, given that it would reap both short- and long-term rewards. As a result, Hemal won’t have to worry too much if the market undergoes a downturn.

“My portfolio will be balanced and positively geared, and I’ll be able to make the repayments for my Australian properties even if the rates were to increase. It serves as a buffer for any market fluctuations that may occur in the future,” Hemal says.

Despite his short time as an investor, Hemal now has seven properties to his name, and he credits his successful handling of his portfolio thus far to his self-education. 

“My biggest realisation was that any challenge could be overcome through education. I’ve been able to avoid major mistakes in my property investing journey, and I attribute this to my research-heavy approach, as well as learning from other investors’ successes and mistakes.” 

Hemal studied everything he could, from investor podcasts and forums to YouTube videos.

“I reached out to some of the people I had listened to on podcasts and was even able to get some great advice for free,” he says.

“I purchased property as quickly as possible whilst doing my due diligence, and now it’s only a matter of time before I see the benefits.”


Hemal Mistry’s success in building a stable income through property investing has reduced his financial stress and freed up his time so he can focus on his family and wellbeing

Maintaining momentum

Hemal has hit the ground running over the past two years and is still keen to go full steam ahead.

“My ultimate goal is to continue to grow my portfolio in as viable a way as I can based on my circumstances. I don’t have a particular number of properties or a target income I’m looking to achieve – as long as I can keep investing in property, I will!” he says.

He also plans to expand his horizons beyond just buying and holding on to his Australia properties.

“My approach is to manufacture growth by sourcing properties that require some renovation work, which allows for some negotiation of the sale price. After renovations are completed, it enables you to pull out the equity to fund the next property. But in the near future I am also considering subdividing the land for my Australian property and developing a granny flat to increase cash flow.”

“It occurred to me that it doesn’t matter what country you invest in – a market is a market regardless of where it is located”

With his finances more stable thanks to his portfolio, Hemal can relax without the trappings of the typical employee lifestyle.

“Investing in property has been a game changer. I now have the reassurance of financial security for when I decide to start a family and when I eventually retire. I don’t have to worry if I’m unable to work for whatever reason, as I now have funds I can access from my property portfolio.

“With less financial stress, I’ve been able to focus more on other aspects of my life, including travelling and my wellbeing,” he explains.

“I believe that property will continue to provide me with new opportunities in the future, including the chance to teach and help others achieve what I have.

“I also believe that if you understand the fundamentals of property investing and the criteria of the property you should source, then something that seems impossible becomes possible as it’s now simplifi ed in your mind. The risk is no longer as high as you once thought!”

PORTFOLIO TIMELINE 

2009

While working in the UK, Hemal Mistry purchases his first home as his primary residence.

Hemal leaves the UK for Australia. He converts his house in the Midlands into a rental property and hires a property manager.

2017


Hemal’s property in Kallangur, QLD, was his jumping off point for building a portfolio in Australia

As the rental income from his UK property pours in, Hemal realises how profi table investing in property can be. He makes the decision to invest in Australia, and buys his fi rst property in Kallangur, Queensland, for $338,000 after a period of self-education.

2018


One of four investments in Queensland, Hemal’s Kippa-Ring house brings in a healthy 5% yield

In line with his strategy to acquire as many properties as possible in a short period of time, Hemal purchases three more houses in the Sunshine State through equity generated from his previous investments.

2018


Hemal’s houses in Petrie, QLD, have jumped in value by $85k–$100k each in the past year alone

Hemal realises a renovation strategy will not only help add capital value but also facilitate further property purchases. He renovates his Brisbane properties, using the new equity each time to purchase his next investment.

2019


Hemal’s properties in Detroit earn massive rental yields of more than 25%

Keen to find positive cash flow properties to balance out the neutral cash flow investments he’s made in Australia, Hemal goes overseas once more in search of a deal. He establishes an SMSF and uses it to buy two houses in Detroit, USA, to benefit from the high yields.

Top Suburbs : dulwich hill , belmont , st peters , kariong , ropes crossing

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