Beautician reveals key decision that won her 20 properties worth $ 20 million

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A beautician who earns $ 700,000 a year in rental income on her $ 20 million portfolio of 20 properties has revealed what made her real estate empire possible.

A former esthetician who pockets nearly $ 700,000 a year in net rental income from her $ 20 million portfolio of 20 properties has revealed that a major decision made her real estate empire possible.

Helen Tarrant, whose family emigrated from China to Australia when she was young with $ 70 under her belt, said buying commercial rather than residential properties was key to her success.

The rest was due to a combination of smart investing, good timing, and incredible increases in rents and prices in the commercial market.

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Ms Tarrant said she had long planned to invest in real estate as a way to build wealth, but originally intended to buy whatever she could afford on the market. residential market.

Being self-employed limited her borrowing capacity and she was about to buy a small one-bedroom studio in Sydney’s Lower North Shore ten years ago, but changed her mind at the last minute.

“I was working hard as a beautician, but my 80-year-old owner went out fishing most of the week,” she said.

“It got me thinking about what it would be like to be on the other side and I started to think about commercial property… once I thought about it I realized it was almost like this secret society. People don’t know about it and what you can do.

Ms. Tarrant bought her first commercial property in 2012 – a 52m² catering space with a Japanese restaurant as a tenant.

She bought it for $ 360,000 and got a rental yield of 8%. The tenant was locked into a five-year lease. The net cash flow after mortgage fees was $ 10,000 per year.

“I kept money after paying all my expenses. I never would have had that kind of cash flow with a one bedroom studio, ”Ms. Tarrant said.

“What people don’t realize is that this kind of cash flow makes it a lot easier to accelerate your portfolio growth because you can keep borrowing as long as the cash flow is good.

“With residential, most people stop buying when they can’t pay off new mortgages.”

Ms. Tarrant bought her next properties in 2014: two office space in Roseville on the upper north shore. They are each subdivided into two additional offices to obtain four sources of rental income.

She and her husband funded the case by dipping into equity in their home and pulling out additional equity in the North Sydney restaurant.

It was with these purchases that her buying strategy for the following properties began to take shape: she normally targets properties with multiple tenants, easy accessibility and high cash flow.

It now has 52 tenants in its 20 commercial properties. The properties include warehouses, stores and offices in metropolitan areas.

Twelve of the properties are in South East Queensland, two in the New South Wales region, three in Sydney and three in the Victoria region, including Wodonga.

“What I’m looking for depends on the type of property. With retail, you want something that drives foot traffic there. Maybe it’s near an Aldi or a Coles.

“With warehouses, you want good access for trucks, maybe something near a highway.

“And then with the offices, it doesn’t have to be in the CBD, but you have to look at who the other tenants are in the building, are they paying their rent … the safest tenants are the doctors and the lawyers.

Ms. Tarrant no longer works as a beautician and is now a Commercial Buyers Agent. She said there were three major advantages to investing in commercial real estate:

Tenants pay the expenses: Unlike residential property where the owner pays property taxes, electricity, water and land, commercial tenants pay all expenses. You don’t have to reach into your own pocket when big bills are due.

The yields are higher: A million dollar residential property in Sydney could be rented for $ 600 per week. After you cut the expenses and the mortgage, you end up being on the negative side, Ms. Tarrant said. The same $ 1 million investment in the trade, if done right, could generate net returns of over $ 1,000 to $ 2,000, she said.

Potential for capital growth: “I recently sold my very first commercial property in June 2021 for $ 1.05 million, having originally bought it for $ 360,000 in 2012. All the time I was getting positive cash flow while I was holding her. “

Originally published as Beautician reveals key decision that won her 20 properties worth $ 20 million


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