When he was growing up Todd Hunter’s parents instilled in him two strengths that were more enduring and worthwhile than just about anything a teenager could ask for: a strong work ethic and a passion for property.

This was particularly evident in his high school years when he was working at his parents’ motorcycle shop. During this time he would spend his Saturdays sweeping floors, filling up oil stands and cleaning bikes. The reward was $5 an hour, but in the long term it all added up.

“When I was coming to the end of Year 12, I was working part-time and saving quite well,” says Todd.

“My parents were self-employed and they also used property as a tool for creating wealth. I was the youngest of three and all three of us were pushing to get into property early.”

At the ripe young age of 19, Todd followed his parents’ example and together with his girlfriend bought a one-bedroom unit in Cronulla, Sydney, for $111,000. In order to finance it, they had saved up enough to cover a 20% deposit and set-up costs, and applied for a loan of $88,000.

At first they were apprehensive about taking on the debt, but with both their incomes paying off the loan, they found the process relatively straightforward.

“Then I bought a second property when I was about 20 or 21,” Todd says.  However, after splitting up with his girlfriend, further investing became a much harder experience for Todd on his sole income.

How travel influenced Todd

Todd’s next move was to give investing a rest for a while and travel the country. He travelled to Victoria and South Australia, but it was in Western Australia that he learnt something that would become a major game changer for him.

While in the city of Bunbury, which is about two hours south of Perth, Todd discovered he could buy a house for between $130,000 and $150,000, and for someone who had grown up in Sydney, this was a shock, to say the least.

“My last purchase was $240,000 for a two-bedroom unit in Sydney, and here I was thinking, ‘I can buy a house over here for $130,000’,” he says. “That image stuck in my head and I didn’t know why.”

Moreover, while Todd was in Perth, he lived in shared accommodation with a couple of mortgage brokers.

“I loved the lifestyle they had, the flexibility with work they had, and they seemed to be earning a good income,” he says.

“So, when I came back to Sydney I said, ‘I want to be a mortgage broker’.”

Todd followed his ambition and joined the team at Aussie Home Loans. Then, after 15 months of writing home loans for Aussie, he became an independent mortgage broker and buyer’s agent.

He also began researching why WA was significantly undervalued in comparison to the eastern states.

The only definitive answer he could come up with had to do with data. People generally didn’t have access to it and the data was often about 12 months old, he says. Moreover, there were many people in the eastern states who did not know much about the opportunities in the west.

Todd could see that everything about WA’s economy was in great shape, including its employment prospects.

“I had good equity in my properties in Sydney, so I started investing in WA,” he says.

This was in 2003, before WA really began to boom.

“The boom started happening and the markets started taking off,” he says. “This started in about 2004, but it then hit turbo mode in about 2005–2007.”

In particular, Todd targeted regional WA, and the first property he bought was in Australind in Bunbury. After that he purchased in Collie, Orelia and Wandina.

Todd ended up buying about 80 properties in WA and then selling a bunch so he was left with 50 once the boom finished. Some of the properties he bought tripled or quadrupled in value.

One of the challenges of Todd’s investing strategy involved accessing the number of deposits he needed through equity, and having the ability to service the increasing debt on each purchase.

As a solution to this, he used the absolute minimum deposit for each property purchase and consequently a minimum of equity on each transaction. He also targeted affordable properties with high yields to cover the mortgages.

This resulted in Todd paying mortgage insurance on each deal, but the upside was that he didn’t have much trouble purchasing multiple properties.

Todd's strategies for building equity

Buy undervalued properties with no competition

While he was on his buying spree in WA, Todd did not rely on doing renovations and subdivisions to boost the equity in his properties.

Instead, he was looking for properties that were undervalued in comparison to the sales data that was recorded for each suburb. These were the ones that were not attracting much interest from investors.

“The advantage is that you are not only buying them cheap, but you also don’t have to compete with other buyers.”

Todd contrasts this situation to Sydney at the moment, where you can go to an auction and there will often be 20 or 30 people to compete with. Hence investors are likely to struggle to get a great deal.

“I had no competition and I could cherry-pick the properties that I wanted,” he says.

“I could throw ridiculous offers at those properties and try to buy them as cheap as possible.

“If I put in enough offers on enough properties, then I would always find vendors who wanted to get out of their property, liquidate and move on.”

Avoid mining towns

Despite investing heavily in WA, which has been a major beneficiary of the mining boom, Todd has made it part of his strategy to stay away from mining towns.

However, he has bought in places like Geraldton, Bunbury and Collie, which have a mining influence but don’t rely solely on the sector. “I am no fan of the housing construction that surrounds mining towns, because it’s too volatile. Obviously, we are seeing that now with these huge corrections in prices in Karratha, Gladstone and Moranbah,” he says. Todd cites commodity price changes and mine closures as events that significantly impact on property prices in mining towns.

Buy very cheap properties

During Todd’s buying spree in WA, he picked up some great bargains. In Collie, he was buying two- and three-bedroom fibro houses, which were built in the 1950s and ’60s, for between $47,000 and $90,000. They were then renting for about $120–$130 a week.

“Towards the end of the WA boom, which was 2006–07, houses were selling for between $160,000 and $200,000,” he says.

“In particular, I managed to sell my $47,000 property for four times that amount.”

Buy houses and land

Todd found that in the suburbs he was targeting in WA, buying house and land packages was a good option.

One of the few times he went down the construction path was when he bought some blocks of land in Geraldton that he says were “grossly undervalued” compared to other properties in town.

He purchased three blocks of land, built houses on each of them, and by the time construction was completed they had doubled in value from $250,000 to $500,000.

Todd was particularly happy with another block of land that he bought in Wandina, on the outskirts of Geraldton, in 2004. He bought the land for the modest sum of $56,000 and built a four-bedroom, two-bathroom, double-garage home with scenic ocean views. The icing on the cake was that he sold the property for a whopping $495,000 in 2006.

Sell properties

Todd’s ambition to continually buy investment property in WA meant that he had to make some compromises. One of these was to sell some of his properties in order to increase deposits and decrease investment debt.

Despite the fact that selling properties attracted capital gains tax and real estate agents’ fees, bearing the cost of this was necessary for Todd to continue to make good profits. It was very much a matter of focusing on the money he was making, not on what he was spending.

“Some locations sell quickly, while others take a bit longer,” he says.

Todd has found that the suburbs that take longer to sell in are those where incomes are not quite as high. Therefore he has adjusted his strategy to factor in average incomes when working out where to buy.

“If you don’t have a high average income in the area, you won’t see the rental income increase as fast, which means you also won’t see the house prices increase as fast either,” he says.

Todd’s advice to investors looking to build equity quickly

In order to build equity quickly, Todd recommends following Warren Buffett’s strategy for buying shares. The first step is waiting for the market to drop significantly.

“He’ll look for the good opportunities with those companies that have fallen, and buy the shares cheap; I do the same with property, and then I allow the good times to come back.”

And despite not doing too many renovations himself, Todd believes there are great opportunities for renovators in the right part of the property cycle. “If you are going to build equity in a rising market, renovation is fantastic,” he says. “But in a completely dead market, you still need to wait a bit.”

Further, Todd sees himself as anything but a ‘get out there and get rich quick’ style of investor. “For me, it’s all about getting the right properties at the right price and the equity will come,” he says.

The key is to do research on the area and make sure it’s not a place that’s too heavily influenced by a single factor, such as a mining town, he says.

Buying in the GFC

As someone on the lookout for properties that had the potential to bounce back significantly, Todd was able to take advantage of the great opportunities presented by the GFC. In fact, the last time he bought in Sydney was during this period. He bought in suburbs such as Campbelltown, St Helens Park, Ambarvale and Rosemeadow. The majority of what he purchased was bought for between just $260,000 and $290,000.

“It was fantastic buying and had great rental returns at the time,” he says.

“After buying in the dead part during the GFC, those properties are now valued between $450,000 and $500,000, which is nice.”

For Todd, it was again about buying at the right place at the right time.

“There was nobody buying property out there at all, so we were putting ridiculous offers on properties and buying them cheap,” he says.

In fact, it was around this period in 2008 when the GFC saw much of Sydney’s property prices plunge, and that combined with a desperate vendor resulted in Todd picking up his dream home in Port Hacking for $600,000 under the asking price.


Todd’s strategy of buying under market value has been so effective that he has only ever lost money on one property, a holiday house.

“But it was a love purchase and I held on to it and it was fantastic. Then I sold it,” he says.

That’s not a bad record for somebody who has invested in every state and territory except the NT.

“I think we are going to see in Southeast Queensland that it will be full steam ahead,” he says.

“We have got lots of properties up there and I think it’s coming of age beautifully right now.”

At the moment, Todd’s biggest challenge is renovating his own home. He is currently halfway through the $1m renovation and has found it time-consuming making sure everything is right with regard to products and the builders, while still running his wHeregroup business and investing in property at the same time.

But despite his success in building equity without renovations (in addition to the challenges of his own family home), Todd is still open to doing renos in the near future. In fact, he is currently looking at putting a renovation team together in Victoria, as he has a few investment properties down there that are all within driving distance of each other.

“I’m thinking about getting a team of guys down there to do some mini renos on a whole bunch of our properties,” he says.

For Todd, it’s just a matter of seeing the potential in something that can eventually become really valuable.

As Warren Buffet says, “Price is what you pay. Value is what you get”.

Boosting rental returns

One of Todd’s biggest challenges so far has been setting up and investing in the US. The difficulty wasn’t so much grasping the terminology; it was more about learning how they do things and “getting the t’s crossed and the i’s dotted”, he says. Then of course there’s the jet lag that comes with the travel.

Nevertheless, he still finds it a fun experience and is particularly impressed with the yields that investors can get over there.

“We are getting 18–22% yields, and renting them out very, very fast,” he says.

“It’s not for everybody, but for those who are in a comfortable position in life right now with good equity and virtually no home loan, it’s a very good option.”