Property Hub - Investment Insights & Inspiration - Get Invested: Part 1 - Michael Olivieri on investing in time

Starting point is 00:00:00 compounding the power of compounding and um that from a very early age i went yeah that that is uh so powerful um i remember seeing um like a graph a diagram um which was the most scary and exciting thing at the time i'd ever seen and it just put this fire in me to go well from the age of 20 to 30 I need to work as hard as I can and as smart as I can to um do whatever I can to get compounding on my side so that um I had time working for me and also when I bought my first property um it wasn't as scary to to do because I felt like if I did make a mistake or um if I stuffed up and it went bad, I had time to recover. Welcome to Get Invested on the Property Hub podcast channel, the leading weekly show to help you unlock your full self-health and wealth

Starting point is 00:01:07 potential. I'm your host, Bushy Martin, and each week I go deep with the best investors, experts, leaders, and founders to find out what it takes to break free from the grind, discover freedom, and live by design. Subscribe now and join me and get invested in the life you really want. Let's get started. Hi, Freedom Fighters. Are you interested in investing in property? Why? And what have you done about it? Now, most hardworking Aussies know they want to do something in property, but many just can't see how. And the result? Nothing happens. There's always some excuse why now is never the right time to get started because conditions are never perfect. Or you just kid yourself that you just don't have the time because there's always some other

Starting point is 00:01:56 urgency getting in the way. Or you kid yourself that you've got plenty of time so you just don't have to worry about it yet. Now, this is a real fool's paradise. As I keep saying, it's the start that stops most people. But sadly, this means that most are missing the point because success in investing is all about time. If it's one thing that you need to imprint indelibly on your forehead when it comes to securing your future, it's the benefit of giving yourself lots and lots of TLC. Now I don't mean the normal tender loving care, although investing will actually give you this. I'm talking about TLC in the sense of time, leverage and compounding growth. Like an olympic, but sustainable success in anything takes a minimum of 15 years. So you need to embrace

Starting point is 00:02:46 time as your friend instead of treating it as your foe and you need to leverage other people's skills and other people's money and then you can just let the magic of compounding returns do the heavy lifting. So just remember TLC, time, leverage and compounding. And the first and most important of these is time. You need to make the time now to secure your property portfolio as quickly as you can so that you can then let time allow the compounding returns to grow your nest egg that are going to generate the residual income you need to get your time back to do the things that are important to you. So take the time to invest now to use your time to get your time back. Because investment success is never about when, it's always about where and what. Because the

Starting point is 00:03:33 best time to invest is every time you can. And the earlier you start and the more time you have up your sleeve, the easier and less risky it all is. If you've got 15 plus years up your sleeve, investing can be a bit like a casual stroll in the park. But if you're like the many who leave it until they're in their late 40s or early 50s and they suddenly have their oh shit super moment when they realise that their super isn't going to be enough to sustain their lifestyle when they stop work. Investing in a short time frame in this sense is more like the white knuckle ride of scaling a vertical cliff where any wrong move could end up in a life-threatening disaster. So the earlier you start, the easier it is. And today's guest, Michael Olivieri,

Starting point is 00:04:18 and I hope I got the pronunciation right there, Michael, is an absolute living example of the success of this approach. As you're about to hear in detail, from a very young age, Michael could see the benefit of property ownership and wanted to get started as quickly as he could. As a result, he dedicated his career to learning as much as he could about property and he managed to secure his first property at the tender age of just 21. Now, by the time he was 29, he'd grown the value of his portfolio to over $3.5 million. And he then forged his professional career, firstly in commercial property before opening his own successful Central Coast Buyers Agency north of Sydney in New South Wales, where he now helps you and others to achieve

Starting point is 00:04:59 your property goals. So in today's episode, we continue our series of sharing the nitty-gritty details of the property journeys of other hands-on investors and the learnings that this is going to give you. Now, before we get into it, I need to ask you a big favour that's only going to take a few seconds of your time. About 72% of you that watch Property Hub podcast don't subscribe. So if you've ever enjoyed our shows and our videos, can you please do us a quick favour and hit the subscribe button now. It helps our channel more than you know, and I promise you that the bigger the channel gets, the better the guests get, and the better your investment learnings are going to be. Now, in the newly formed tradition of your Property Hubs Get Invested podcast, we're breaking

Starting point is 00:05:41 our awesome conversation with Michael into two parts. Today's chat will focus on unpacking his personal property journey with next week's flow on discussion is going to reveal how his buyer's agents approach is helping you and others to avoid the common property mistakes in order to optimise your property portfolio performance. So after having the pleasure of meeting Michael at the recent Property Investment Professionals of Australia or PIPA conference in Sydney, I'm really looking forward to our conversation. So welcome and let's get invested, Michael. Thanks, Bushy. It's an honour and a privilege to be with you today. I really enjoyed our chat at the PIPA conference, mate. So I know we're going to have some

Starting point is 00:06:22 fun today but uh michael sort of kick things off for those who don't know you uh can you start by telling us what you do differently and more importantly why you do what you do um i don't know if i do anything super different to to to other investors um i'm not one to be very sort of innovative in terms of trying to you know change the wheel or reinvent the wheel um i just i learned from others saw what they were doing that was successful and just did the same um i think i suppose the different approaches i realized very very early on and you touched on it in the intro compounding the power of compounding and um that from a very early age I went, yeah, that is so powerful.

Starting point is 00:07:14 I remember seeing like a graph, a diagram, which was the most scary and exciting thing at the time I'd ever seen. And basically, if you invest $10,000, it looks at the working life. So it's from 20, say 20 to 60, 40 years. If you invest $10,000 into whatever it is, be it property, shares, the bank where you earn interest in a deposit account or a term deposit, and deposit $100 a month every year for the first 10 years at a 5% interest rate, after 10 years, you'd have $39,000 in there. If you then left that money in the investment but didn't add any additional payments, so you just left that $39,000 and for the next 30 years left it there at the same interest rate of 5%,

Starting point is 00:08:18 it ended up with about $147,000 or something like that. Now, if you didn't start at the age of 20 and you started at 30 and you put that initial 10,000 in and put a hundred dollars every month compounding monthly and you put a hundred dollars every single month for from 30 to 60 so for 30 years worth of payments yep you'd still only get to 126 000 and that scared the crap out of me i just went that that that can't be right and it just put this fire in me to go well from the age of 20 to 30 I need to work as hard as I can and as smart as I can to do whatever I can to get compounding on my side so that I had time working for me.

Starting point is 00:09:09 And also when I bought my first property, it wasn't as scary to do because I felt like if I did make a mistake or if I stuffed up and it went bad, I had time to recover. So I was able to sort of jump in a little bit more aggressively into it or with a little bit more confidence knowing that this isn't my last shot. So that's sort of something that, yeah, is really important and I really wanted to share that message. But why I do what I do, it's a really good one.

Starting point is 00:09:49 I think in a single word, it's family. but if i if i really expand on that um and the idea i had before i even had a family was basically what i envisage envisage for the future um as a teenager i thought what you know i don't know not many teenage kids are thinking about getting married and having having a family and doing all those things but i knew that at some stage in my life that would be something that i'd be interested in and and wanted to do so yeah um i had this idea in my head that of what i wanted to be as a as a husband as a father and how i could realize that and um and that stems from you know obviously my own upbringing how i saw my power interactive my

Starting point is 00:10:35 own parents and and i was pretty fortunate we didn't have a um you know i came from a a well-off family i suppose but we weren't you know rich by any means i definitely didn't get all the the toys and the bells and whistles that that i wanted and other kids had but um but i was taught a lot of lessons uh very good life lessons and that um sort of really set me up to go okay well what do i want for my future what's important and how can i get there and i figured if I make some small sacrifices at the start um I'd I'd uh wouldn't have to I'd get to 30 and I wouldn't have to work as hard so um my my goal I always had as a teenager was retire at 30 that was that was the goal and it was a pretty ambitious goal when I'd

Starting point is 00:11:26 you know I'd tell people that and they'd laugh at me and they'd say you're mad like that you can't do that um yeah people that were 30 or close to it or older they'd say no you can't retire at 30 and i thought i'll give it a crack anyway if i if i miss by a couple of years it's still pretty good um yeah so that was sort of my my why um was just yeah retire at 30 so that i could be the the type my ideal husband and father for my family and um really just have the time to be present. Well, there's a whole bunch of stuff I'd like to unpack with what you just shared with us, Michael. And I guess there's a couple of things there that I find really interesting, particularly at a young age, even thinking about what your long-term future looks like

Starting point is 00:12:18 is interesting because very few do that. And secondly, I'd love for you to, so I'd love you to share how that how that came about and why you were were thinking those thoughts at that very early age and and secondly that the the really good example you shared with us there about you know the the need to starting investing at 20 to end up with that result rather than leave it for for 10 years where did you come across that who introduced you to that because to get so inspired and motivated to take some action at such an early age is very rare so can you sort talk us through some of that yeah for sure so um it could have been you know mid-teens when when i was at school um and they start talking to you you know the teachers and

Starting point is 00:13:07 people family and friends around you they start asking you what are you going to do what do you want to do when you finish school and um and i and i thought about it and the answer really was nothing like I didn't want to work um nobody wants to go to work and earn money and go home for me it was you know it's a very sort of I suppose silly way of saying it but really it was it's not that I don't want to do nothing I'm a very active person and I never sit still ask anybody that knows me I'm doing more than most but it was more that I didn't want to have to work i wanted to do something that i enjoyed regardless of what i earned or what what it generated from an income and so so then that got me thinking i was like how do i do that how do you

Starting point is 00:13:55 how do you sit at home or how do you go out and ride a motorbike or how do you go and lie on the beach or whatever it is that you enjoy how do you do that but still get paid um and that's when i started to learn about passive income i was like okay so what's this this idea of passive income How old were you when the idea of passing income came into your mind? What sort of vintage were you, mate? I was probably 15, 15, 16, something like that. So I said to my dad, I said, Dad, how do I stay at home? Well, not stay at home, but how do I not go to work but still earn money?

Starting point is 00:14:29 Like how do you earn money without going to work? And he said, oh, he sort of introduced me to the idea of property. He said, well, if you buy a property, you rent it out, the tenant pays you rent. And I thought, oh, that's good. and he's like you know how we play Monopoly all the time and I was like yeah and he's like basically that and I was like well I'm pretty good at Monopoly so that's that shouldn't be too hard so that that was sort of my first introduction to it and and that really planted the seed and

Starting point is 00:14:55 um I was staying up and I'm not that old but when I was at school there wasn't iPhones and there wasn't there's the technology we have now so it wasn't as accessible yes we did have computers but um there was a podcast and all of those things that are really readily available for people to access the information so i was just you know watching tv late at night and infomercials used to come on and there was this and i'll never forget it this infomercial came on um with uh john fitzgerald from custodian wealth and he was talking i remember i remember yep he was talking about um yeah his story backpack from melbourne to queensland two hundred dollars built this property empire and I was like wow okay so he didn't even have anything and he was able to do

Starting point is 00:15:40 it so I'm like I've got to I've got to work out what he's doing like what's the secret so I was I was watching that and I used to stay up trying to watch it and and listen to the story and it was on pretty early in the hours in the morning so sometimes you know I'd get in trouble for staying up late but um that really was part of the idea and then I just kept talking to talking to dad about it my parents and I was just trying to learn as much as I could while I was still at school and i still didn't know what i wanted to do like in terms of actual career or employment i just knew that i wanted to build a property portfolio that was going to pay me um pay me a passive income so that i could live life on my own terms or as you like to put it live life

Starting point is 00:16:26 by design no i absolutely love that that that's really inspirational mate to hear someone that you know 15 it's starting to think about those things uh you know if i had my time around again it wasn't until i had a an early life process that uh i was forced to have to think about it and there was a lot older than you know i was 33 when that happened uh so uh i've got great admiration for you and i guess what that's telling me to some degree given what you've already shared about your dad uh can you sort of take us through your uh you know a bit of a reader's digest of your life journey so far in terms of we've invested your time energy and money and and how important that family background and upbringing was to uh you know what you did and

Starting point is 00:17:14 where you are and what you what you're now up to today yeah so i suppose for for me and my story um i've got an italian background or heritage and so a lot of that um sort of flows through into my work ethic and my views and values and I also grew up on a on a farm so I worked I watched my my parents work very hard anybody that's a farmer or knows a farmer knows that they work seven days a week there is no weekends yeah so a lot of early early starts and it wasn't your typical farm it was actually a flower farm so it's a little bit different than what most people probably are thinking but it still was very much that life and um you know dad was around we lived on the farm as well so he was he was always there but um he worked very hard and um he had very

Starting point is 00:18:10 humble background and beginnings as well before he started the farm he he was a motor mechanic and he and he used to have a lawnmowing business as well so um i've got a lot of i suppose a lot you know he was a massive mentor for me and a lot of things i've learned from you know how he's run a business and done things but um for me that work ethic really was one of the biggest things i learned from him and he always used to say to me as a kid don't don't do what i've done son work smart don't work hard and he worked physically hard in all his jobs it was a physical job and he traded time for money and um you know he's done well for himself from working hard and a lot of other italian migrants did the same they just worked physically hard and

Starting point is 00:18:59 yes they might have done all right but they did it by accident they didn't really know how they did it it was just through working hard that they got there but it took them their whole life to do it yeah so i had that idea planted in my head of work smart not hard and i was like well how do i work smart and that's where i started sort of going into learning about passive income and compounding and all of those things and that started to then click and i was like okay so this is how you work smart so the thing dad probably didn't realize that i do is i just do both just work hard and smart and um and i think the common the common word in both of those things is work there's nothing that's there's nothing that you can do where you can't you have to put

Starting point is 00:19:42 the work in whether it's a smart way of working whether it's a hard way you have to put the work in you have to take action um so that was always that was always clear to me yeah that's uh really interesting uh you're sharing that story yeah obviously have very similar backgrounds and my good father had a very similar conversation with myself albeit i was a lot older than you were at the time uh but that uh working instead of working hard for money getting your money to work for you was a real life-changing moment when Dad looked me in the eye and said, don't follow my example, learn from me and do something else. That certainly shook my world at that point in time.

Starting point is 00:20:23 But tell me, if you look back on your journey so far, Michael, what challenging event in your life has brought about your greatest learnings and your best changes, do you think? I'd say probably at the, like, right today in this moment is my most challenging moment i think if you if you if you look back on your life yesterday should be easier than today um because you should always constantly be challenging yourself i've very much always had that mindset i'm on my biggest competition and if i'm not pushing myself each day then um i feel like i'm going backwards so this point in my life is probably my most

Starting point is 00:21:04 challenging juggling family investments money um business and time trying to actually fit it all in that's that's my biggest challenge so it's it's led me over the last sort of year and a bit to really reassess and think okay well sit back and go well what did i want to do to achieve why did i go on the path and that i did and make the sacrifices that i did so that i so that i could achieve the life that i wanted so i'm starting to try and swing that pendulum back a little bit to a bit more of a balanced lifestyle have a bit more time to do the things i enjoy and the reason why i built a property portfolio in the first place yeah yeah no that makes perfect sense so so if you look look back on that upbringing and and uh what's emerged from from the italian

Starting point is 00:22:00 ancestry and the working on the land. How has that affected your core values and beliefs and how has that influenced the decisions that you've made since that sort of penny drop moment when you're about 15 moving forward, mate? I look back to my grandparents when they migrated to the country and they literally just came with, you know, two luggage, two suitcases and nothing else it taught the the value of being frugal so i was i was very frugal every dollar i earned i saved um and once i learned about compounding interest and all those things i was getting it into the the highest interest earning account that i possibly could as a kid and um yeah i was frustrating i was 16 i was and you couldn't do it much until you turned 18 i was like

Starting point is 00:22:47 oh surely i can invest it and they're like no all you can do is park it in the bank fortunately at the time and the interest rates were similar to where they are now around six six percent something like that so five percent so it was um you know it actually earned a fair bit of money and i remember the first time that um i was earning like fifty dollars a month and i was like that is paying my phone bill now that that interest is now paying my phone bill so all of a sudden i was like my phone's for free now and um and once then i started obviously building that more and i was like okay there's more money and just every dollar i went into saving so it was a very frugal lifestyle um and um yeah again it was all about around based around family a lot of based around food as well

Starting point is 00:23:37 but just really getting enjoyment out of those sort of simple things and that solid grounding always um it gave me a good place to base from i love that so we're yeah and we'll get into your the nitty-gritties of your property journey shortly but where did where did you end up going in relation to your uh work career what you mentioned you're earning 50 bucks a month there once you'd left school can you just take us a little bit on the on your professional journey if you like um and then circle it back to what you're doing now yeah so when um i was probably in year 12 um and and i like growing up on the land i really loved working with my hands i thought for sure i was going to do a trade i wasn't going to go to uni um not that i felt like uni was

Starting point is 00:24:25 unattainable i just thought that's not for me i hate sitting in front of the computer i was like i've got to be outside um but yeah so i had a few ideas around do i become you know a builder a carpenter or something like that or um go into something to do with sport or fitness because i really enjoy um playing sport and being active so i thought that's something that i was going to do but a family member of ours was also a careers counsellor and I was having a chat with him and he said, what are you thinking about doing? I said, I was thinking about going to uni and doing accounting

Starting point is 00:25:01 but I don't really, I don't think uni is really for me. And he said, oh, there's this property degree because he asked me, what do you enjoy doing? And I was telling him what I wanted to do. I wanted to build a property portfolio. And he said, oh, there's this property degree. And I went, done, sign me up. That is exactly what I want.

Starting point is 00:25:18 I didn't even ask any questions about it. I thought that's got to be, I just wanted to learn as much as I could about property. And like I said earlier, there wasn't really all these podcasts and all these things back then for me to tap into. So I thought, how can I do it? So I thought if I either study it or work in it, that I'd get a really good opportunity to just rub shoulders with other people in the property industry, pick their brain. And if I was working in it, I'd be just so surrounded by it

Starting point is 00:25:47 that I'd work something out. So that led me to do my university degree, which was basically a business degree with a major in property. Really good grounding around a lot of the aspects of property. Even though it's a relatively small industry, there's so many little things you can do within it. So I got a good understanding of that. I had to do a valuation unit every semester and after doing that I went I definitely don't want

Starting point is 00:26:18 to be a valuer um but it did give me very good um understanding of how to value property how to understand what a property is worth and that then I sort of springboarded me into when I was selecting properties understanding okay well what's the value of this property and how to then negotiate it so yeah um yeah so that's sort of what started me off i my first job um out of uni was as a a lease administrator so in working in the commercial uh in a commercial property team for harvey norman um oh yeah yeah so so all of my career basically i worked for client side for large retailers and uh yeah the first job was with them which was actually really interesting because when i told people i worked for harvey norman they they couldn't they said what selling fridges and

Starting point is 00:27:11 i was like no i'm in the property team and um yeah so it was and i remember coming out of uni my brother's only 14 uh 18 months younger than me and and he'd done a trade and he was earning by then he was sort of third or maybe third year apprentice or maybe um fully qualified and i was earning 45 grand a year and i thought and he was earning more than me and i'd just done three years of union i thought what have i done wrong here and um but uh you know i stuck with it i thought no this is something i'm pretty sure i'm on the right path so um it was a good grounding and with with that job because harvey harvey norman is actually a very large property owner so why he's like ray crocker i mean my my brother has uh in fact my brother's driving the harvey norman

Starting point is 00:28:02 expansion into malaysia as we speak uh so i've second hand through him i've got to understand a lot about how jerry harvey operates and and he's he's like uh the ray crock founder of mcdonald's mate uh his biggest asset bases are the properties that uh house the the uh harvey norman franchises because uh the way he operates and the way he gets the franchisees to pretty much cover all cost of that while he continues to build his property portfolio what a brilliant business model so if you are immersed in that and getting that firsthand i can i can see that would have been a big advantage to what you ended up doing personally yeah that definitely was it's i remember um when when i was working there at the time that a third of the total income that that company

Starting point is 00:28:55 generated and argument generated was derived from property and i thought wow for all of the retail sales for all of the other fingers he had in pies property rent generated one third of the total business's income so yeah jerry definitely was you know he was onto something and that's yeah when i started looking into realizing that mcdonald's was obviously a property business not of burger business and and all those other things so that exposure to to how powerful property really is um yeah that was that was really good so um obviously went from there to to um uh bigger things and and so so i worked my way up into the into leasing and um portfolio management through different companies and different different roles in different companies

Starting point is 00:29:43 um each time the sort of the the property size got smaller so i went from harvey's to bridgestone to um a porter and red rooster so each time the property the retail space got smaller but it got faster yes and um yeah so that was really exciting i actually end up enjoying like finding a passion there that um you know people say you've got you got to enjoy what you do so you don't work a day in your life but i think at the start as a kid you especially if you don't know what you want to do you just go and get a job and you start working you make money and for me it was i was making money to buy property because that was what i wanted to do but i ended up actually enjoying what i did so that was a bonus well you're investing in knowledge and i've often said

Starting point is 00:30:29 michael that passion grows from expertise and when i hear people say you've got to know your passion before you decide what you do i think we've got it the wrong way around i think your passion grows as your as your level of understanding and expertise in an area grows and you feel really good about it then that that's where the passion actually flourishes and i think in your case given that you would you know again very smartly immersed yourself in the property arena from a professional perspective that then all of that head knowledge you could then start to direct into your own, building your own portfolio. What a great way to go.

Starting point is 00:31:10 So tell me then, you sort of stayed in that commercial space for a fair period. What then triggered the move to, and I'm assuming that the next move after that was to start your own buyer's agency, or were there any steps in between? Yeah, so basically from the corporate career, I got to a point and it was during COVID where obviously we went into lockdown One of the roles I had was looking after the WA portfolio

Starting point is 00:31:40 and because I couldn't fly there, I was unfortunately made redundant from that role. So I picked up a role with another company, but it was only a contract position. And so I basically had the opportunity to sit down and say, what do I really want to do? You know, I've purchased a few properties by this stage. I thought, you know, I don't want to keep travelling to Sydney for work.

Starting point is 00:32:04 i want to be around to to watch my family grow and um and i i really like like i said became passionate about what i was doing about passionate about property i just wanted to share that with other people so i knew what a buyer's agent was um because when i when i looked to buy my first property i actually reached out to um a buyer's agent to to try and learn from them um and i wanted to be involved so even though they were um you know they you they you pay them a fee and they buy you the property i i said yeah i'm happy to do that but can i be involved in the actual selection can i be involved in the process and they said no that's not how it works i just realized no that's well i'm just gonna have to do it myself because i actually want

Starting point is 00:32:55 to learn the process i don't want to um you know i don't want to just give you the money and then you'd buy because i'm not learning anything so yeah that's why i knew what a buyer's agent was and um but i stayed in my corporate career because i realized that earning that payg income was very easy for me to then leverage um and to build my own portfolio yeah but once i yeah once i got to that sort of stage in my career i purchased a few properties and um yeah covert here to just COVID was a really good, I suppose, a good thing for many people to really think about what they want out of life. So, yeah, that's what led me to start the Buyers Agency.

Starting point is 00:33:41 And basically I just did that and started the business and structured the business in a way that I wanted it to be. So touching on that point I made earlier around the Buyers Agent didn't want to sort of work with me, my style is very much educating, buyers or clients as they as they buy and teaching them why we're why we're selecting this particular property and why it fits in with their strategy because i'm passionate about i just love talking about it so yeah that's yeah i love that well i i guess um what the big missing chunk here now is your own property journey because i'm hearing that the you were sort of struggling

Starting point is 00:34:24 both in terms of your professional property involvement commercially initially, but also on that track to go hard from 20 to 30 to put yourself in a good position. Let's dive into that now because I'd love to just unpack the whole exercise. And I want you to start with why did you decide to invest and what really you've touched on your father suggesting property as a thing.

Starting point is 00:34:50 Was that the thing that really triggered your interest in property? Yeah, well, basically that was really the first trigger was him introducing the idea of property to me and the idea of buying and owning property and collecting rent. And then from there it was really up to me to take that and run with it and just actually learn as much as I could about it because you can flip property, you can buy it, renovate and flip it,

Starting point is 00:35:16 you can develop it, you can buy and hold. There's many different strategies there, So it was important for me to work out what was going to be the best strategy. And so I did a lot of, I read a lot of books. I attended a lot of seminars and, you know, events and conferences around property and just tried to take at least one nugget from every single thing that I, you know, read or watched or listened to. And the common sort of thing that I picked up was that it was the ownership, long-term

Starting point is 00:35:48 ownership that is where the real wealth was built yeah so for me my my strategy was just buy and hold um which again is a very italian thing that's drummed into you as well just buy and hold never sell um so that was um yeah that's sort of what sparked the interest so basically uh i finished uni work started working saved my butt off for that whole year like i said i i'd but well sorry from school to uni i'd worked as well uh part-time on the farm so whenever i wasn't at uni i was working on the farm and um i'd managed to save i think thirty thousand dollars yeah in that stage um and then uh started my career and like i said i only made 45 grand that year so i actually worked three jobs to be able to save up more money and by the end of that year i think

Starting point is 00:36:47 i'd saved about seventy thousand dollars uh sorry like a total of 70 so saved 40 so pretty much everything i earned from my corporate job went into savings and the other two jobs i worked were basically just to to have a bit of money to to enjoy life spend some to do some social things but the majority of it, even that, still went into savings. I love that. Sorry to jump in there, but before we get into what you then start on buying, et cetera, do you have any initial fears or feelings of concern about property and investing before you actually

Starting point is 00:37:23 pulled the trigger? No, not so much about property itself, but definitely when I signed that contract when I bought that first property uh buyer's remorse kicked in and I was like oh what have I done you know I started doubting myself and um do I really you know do I really know what I'm doing have I researched enough and you know all those normal things that a first-time property buyer or property investor goes through um so no I didn't really have fears about property because I felt confident that that was a a thing long term but it was more just doubting myself uh still being young you know 21 everyone else was out partying or going over to europe and

Starting point is 00:38:07 i was signing a contract for a property so i love it i what i think is important there and and good to share with those that are listening is that because you're invested in your knowledge so you are talking to a lot of people you are reading a lot of books you're going to seminars that in itself helps to uh evaporate the fear because the confidence grows as the clarity and the understanding uh emerges from that so you're then going ahead without those fear hurdles getting getting in the road so i really appreciate you sharing that mate let's now i really want to jump into the nitty-gritties of the particulars of your property journey in terms of what you did when and why what challenges that did you overcome what worked and what didn't and what have been the

Starting point is 00:38:51 learnings from all of that yeah so i suppose let's let's talk about the first property so i knew that i wanted to buy a land so i'd worked out a bit of a strategy which for me was buy buy land buy house on land um hold hold that property for as long you know as long as possible um if if possible also have some kind of development subdivision potential on the property so um with my 70 grand i'd saved up basically i had enough for a 50k deposit as a 10 deposit so for a 500 000 purchase with with purchasing cost as well so um wasn't much money i spoke well back then it probably was it allowed me to buy a property in sydney um and i was lucky to to have um some good people around me that i could draw advice from so um i i looked at sort of some areas and i was looking around

Starting point is 00:39:50 paramata region but 500 grand then i could probably only really get a unit um how long ago was this man i just just put a time frame 20 something yeah probably 2014 i think yeah okay 2014 yeah so um and and so that was the start of the the sydney boom back then too i think we would well we're definitely in it because i remember watching the market that i'm so i ended up buying the suburb just outside of penrith and um that was every i watched that really closely for six months and every property that was listed whatever price was listed out it was selling like 50 grand over and i was like you know this is just running away and i was starting to think you know how can i how can i do it so um that knowledge basically gave me the ability to when i found a property

Starting point is 00:40:44 that i went yeah that's that's the right one uh well that's the one i want to buy i knew what i needed to offer in order to secure it so that i didn't miss out on it um so yeah i purchased that property it was a you know just a modest three bedroom home and had a very light renovation done um but it was on an 800 square meter block and it was already rented from the start so that was good um so i purchased that i then saved worked hard for another i think about nine months worked and saved everything i could and um and i thought all right i'm gonna put a granny flat on this property try and pull some additional income out of it because i was still um i think I'd had a small pay rise, a bit of a promotion but still nothing crazy

Starting point is 00:41:33 and I thought how can I get some more cash flow because I quickly saw that that property was costing me money each week and I needed to do something to change that around. So I built a granny flat on it but I built it in a way so I had a bit of foresight and, you know, obviously if you can do it the other way or if you can do it the direct way, you would but at the time I had to do it sort of the back-end way around, but I had a foresight to build it in a way that I could future subdivide it as well.

Starting point is 00:42:04 Nice. So I built it as a granny flat, which was easy. I didn't have to go through council. I just went through the CDC process, but built it in a way that I could then extend it as well. So I had a big roof line, a few other things like that. So I did that and then, again, worked hard for another six months, saved as much money as I could, and then I engaged a town plan

Starting point is 00:42:27 and a surveyor and a few other people to help me put that DA through. Yep. Got that subdivided and in order to do that, I had to do some more work to the property. I had to put a driveway and some. Crossovers and everything else, yep. Yeah, all those types of things. So additional water meter, all that kind of stuff.

Starting point is 00:42:48 Yep. But all of that, and this is, you know, 2022, 23, I just was getting my hands dirty. I was doing as much as I could myself, getting very involved with all of the consultants that I was engaging to pick their brain on everything they were doing. Not that I ever wanted to take their job away or do their job, but it was just to understand it because I enjoyed it.

Starting point is 00:43:11 So once I'd subdivided that property, that's what really kicked me off into or springboarded me into future properties. So, yeah, and I love the idea of dual income. So I was like, okay, I've got to find some more of these. Yeah. um so yeah the next one uh again i just did a cash out uh from from that uh equity that i produced from the property um and purchased an existing uh an existing house in granny flat so it was already done so i thought i can either try and find a site and build another

Starting point is 00:43:48 granny flat or i can just um i can just buy one done and it was that stage i think it was around 2018 2019 and um i was like okay well that was a bit of a softer period in the market so we'd come through that boom and it started softening a bit and i found a property that at this stage was now on the central coast i started looking back home and going okay well what can i find um because sydney had gone so crazy then i was like i don't have another uh you know 500 grand was sort of that i could buy again so i found a property uh and it was a really good return i think it was a seven cent return wow and i purchased that um and that's when i started sort of dabbling with different ideas around entity structures and things as well so i started speaking with my

Starting point is 00:44:42 accountant and trying to understand uh i told him that i wanted to grow a property portfolio i didn't want to just own one or two i wanted to own as many as i could yeah um so what what sort of challenges what is i going to come up to if i just kept buying them all in my own name or should i start looking at different structures so we started um yeah changing the the different entities to purchase within um this stage i'd met my wife as well and we'd um relocated to the coast So I did live in Sydney for a few years when I studied and started working, but by this stage moved to the coast. We rented for a little bit just so she could get a bit of a feel

Starting point is 00:45:27 for the area and once she was comfortable and we then used that time to find something as well. Yeah, so we purchased our own home. So that was sort of a fun moment for me or an exciting moment because I'd always just lived with family up until then. I never really moved out. I lived at home and then when I moved to Sydney, I lived with my auntie and uncle down there and also my grandmother.

Starting point is 00:46:00 So, yeah, so that was exciting. Yeah, yeah. She very much spoiled me and looked after me, but forever grateful for that ability to have lived without needing to pay rent was something I'll be forever grateful for and it definitely helped me save a lot harder. But at the same time, I didn't take advantage of it. I didn't just go, oh, well, I don't have to have all these extra overheads

Starting point is 00:46:30 so I can party harder or, you know, blow my money. It actually made me save harder because I wanted to make them proud and actually show that, you know, they gave me a helping hand, not necessarily putting cash in my hand, but they gave me a lot of assistance by allowing me to save. So I wanted to really prove to them that they didn't do it for nothing. Yeah. I love what you've shared there because I think there's a couple

Starting point is 00:47:01 of really important messages that come out of what you've done. And one is that you were so focused on building their portfolio that you clearly worked very hard to put together the deposits. So, you know, having multiple jobs to build that income, I think is a really important takeaway because a lot of people I talk to almost want it to happen for them rather than wanting to make it happen. And you taking that extra energy, being very, very frugal with your spending, living with family, working multiple jobs to really turbocharge and jumpstart the exercise for you, I think is a really important takeaway.

Starting point is 00:47:45 And I also think that while the buy and hold exercises, the old Italian buy and hold it forever exercises there, that you've added to that in terms of looking for that redevelopment opportunity and creating the dual incomes with the granny flats where you're effectively creating and manufacturing equity is a really important add-on that you've achieved with that. So I think there's some really good lessons there. If we look at the evolution of your strategy then, while it was initially buy and hold forever, has it changed at all? And what does your strategy look like now and into the future in terms of what you're wanting to achieve? Yeah, it has changed a little bit, Bushy,

Starting point is 00:48:32 in terms of sort of more around lifestyle and balance. So the interest rates at the moment are obviously increased very, very quickly in a very short period of time. I used the power of leverage while I was young and did leverage myself up a lot. Any dollar I could borrow, I would because I knew it was going towards good debt. And so I wasn't scared of it.

Starting point is 00:49:02 And like I said at the start, if I made a mistake, oh well i'll i've got all my life to to fix that up but um so i really leveraged high um and and yeah i did work hard to save his deposits as much as i could but then when i did that subdivision that uh opened up a lot of equity which i really tapped into a lot of that so um i didn't really go over the sort of the 80 mark after that i kept it very highly leveraged and in um property growth has then obviously pulled my LVR right back down. But the actual debts themselves didn't really reduce all that much because the first one I just had left on interest only

Starting point is 00:49:45 and subsequent ones I've tried to put to P&I, but I've also been more focused on paying down that owner-occupier loan because that really is a bugbear of mine, knowing that to me that's a bad debt. This debt's not making me any money. And, yeah, the property is growing in value, but I'd rather have that interest as a tax-deductible expense rather than just watching that money go out the door.

Starting point is 00:50:17 Yeah, so the view I've sort of saw, something I've been thinking about and I'm in the process of doing is selling off that first one to reduce a lot of debt and both investment and owner-occupied debt just to free up a bit of cash flow. um that's probably off the back of my my choice to start a business as well and put a lot of focus into that um but also having started a family and um wanting to to actually achieve the ultimate goal that ultimate lifestyle of being um a present dad being a present husband um i could have easily just kept working hard which is exactly what i did from 20 to 30 i just knuckled down i worked

Starting point is 00:51:02 smart but i worked very hard yeah and i thought if if i just stay on that way see i watched a lot of my uh grandparents in that generation do that they just worked hard worked hard worked hard and they're still working hard even though they don't need to yeah that's all they know and um i had to be very conscious around do i just follow that same path or do i want to live the life actually envisaged when i was back when i was a teenager and what does that look like what What is your ideal lifestyle? If we jump into the future and we apply that living by design sort of approach, what does your ideal lifestyle look like, Michael?

Starting point is 00:51:42 My ideal lifestyle is to be back on the land. I'd love to own my own acreage. I don't want it to be necessarily a working farm, but just obviously I'd have some animals on there, but that's more for a hobby and for a joy and a passion, but I'd love to just be on the land. And the life I had growing up, I just think, really shaped who I am. And I'd love to give that to my kids as well.

Starting point is 00:52:10 I also just love the space and freedom that that gives you. But really, it's just doing what I want to do when I want to do it. So I don't want to stop buying property. I really love doing that, both for myself and for my clients now. So I get a lot of enjoyment out of that. but it's but it's the i like that i don't have the pressure to have to do it um so that's that's sort of why i'm looking to yeah restructure um my portfolio so that i can actually do what i want to set out to do in the first place which was not have to work yeah love it you touched on uh

Starting point is 00:52:51 the uh ownership entity structures earlier on uh talk us through the your the evolution of of thinking and what you've done differently so far along that journey and what that might mean to the types of entities that you buy properties in the future. Can you share that with us? Yeah, so I suppose I'll go back one step to explain how that sort of came about. So after I purchased my first property, I always continued

Starting point is 00:53:18 to invest in education, invest in my knowledge. And so I continued to go along to seminars and there was a lot of those um i suppose property spruger seminars where they're trying to sell your property off the plan or whatever else but there's there's some that were also about education so they don't give you a property to buy or select a property for you to buy they sort of show you how to do it and um i started looking at different ways i could do that and you know i look back on it again was that money well spent well yeah i learned something so i try not to live with any regrets but that was probably my mistake, I would say, or not a mistake, but just something that I go, okay,

Starting point is 00:54:00 learn my lesson there, spend some money on that course, but probably could have put that elsewhere, which would have got me a better return. But in doing that, I was looking at purchasing property interstate and overseas, looking at different options. And part of that was to set up a trust and purchasing that structure. So I'd set up the structure. I didn't end up buying anything overseas because I thought, no, I want to keep my focus here. And so I said to my accountant, well, we've got this trust.

Starting point is 00:54:34 We may as well use it. So we selected a property, so that property that had the existing granny flat on it, to go into there because that was a positively geared property. and so rather than continue to add money to my taxable income it stayed within the trust and just retains profits within there so yeah um that was purchased in there uh and that was sort of yeah by by accident or by chance because of the path because i created it basically yeah i thought i'd spent the money setting it up may as well use it but subsequent to to purchasing our family home

Starting point is 00:55:12 And I then wanted to help my – I've got two younger brothers. I wanted to help them with their property journey. And so we set up a company with my mum and dad as well, which we purchased a property in that entity as well. And so that's been a really good learning lesson. I'd say it wasn't a failure. the property itself again was an existing house in granny flat um performed very well and he's performing very well the the structure though um i've learned a lot from doing that and and so

Starting point is 00:55:52 i've realized that um the way we set it up and structured it has actually sort of um set me back a little bit personally from from future lending and leveraging so it's another reason i'm trying understructure debt so i wouldn't say it was a mistake in terms of the property we selected probably just the way we structure it but that was um really the only way we could at the time but there's a really good learning as well and what i love about to what i'm hearing is that you're prepared to do the research and and and try these exercises to see how it goes and as you've said that the properties perform well but often as you would know in a business structure So particularly, you've got a number of directors, which sounds like your family members, who've all got different interests.

Starting point is 00:56:41 Then effectively, you're taking, in terms of your own personal borrowing capacity ongoing, that's going to absorb a lot of your borrowing capacity because you're effectively responsible for all of that debt, even though you're only one of a few. And the taxation issues and the depreciation issues that are applied to a company are very different to what you'd be doing in either a trust or your personal name. So there's some really good learnings, I think, that flow out of that exercise and that the borrowing capacity and the holding cost side of the equation in terms of the entity structure needs to be very carefully thought about in terms of where you're at on your journey so you're picking the right vehicle at the right time to get the right result. because, you know, as you've shared, I've seen a lot of people who followed the exercise about doing everything in trust and because all of the income and the tax benefits are quarantined in that trust, often the holding cost of those properties is significantly higher than something

Starting point is 00:57:39 if it was done in tenants in common or another structure. So early on in the process, those holding costs can become quite prohibitive and limit your ability to both live and continue to add to the portfolio. So some really good lessons there. If we sort of wrap all this up then, Michael, and looking at your own journey and looking at those that you've been helping as a buyer's agent,

Starting point is 00:58:02 what do you believe are the keys to successful investment and why? Really doing the research and understanding the market that you're buying in, that really is key because every market's different, every suburb and region is different so knowing the the area that you're buying in and not just for the the property buying today but the kind of demand that's going to be there for that property in the future as well obviously my my approach has always been to hold for as long as possible but if ever you need to sell it, or even if you just want to refinance and redraw some equity out of that property to purchase further investment properties, it's that demand for that type

Starting point is 00:58:55 of property in the area that's going to drive the value. So knowing what those drivers are and knowing your area is definitely something that is really important. And just having a really strong why um it's in a lot of the books you read um a lot of the things you listen to they always talk about your why you know you got to write it down or you got to think about it or read it out every day um for me i'm not so diligent on doing that um in terms of you know writing things down or just constantly reciting them but for me it's a it's a feeling it's an emotion when i was when i was a teenager and i had that idea around how i wanted to to be and what the property i wanted to live on and the type of life i wanted to have

Starting point is 00:59:43 that was a really strong emotion and i still have that and i think about it all the time so that um yeah that keeps you going when times are hard well absolutely it becomes a magnet and a compass so i often say this if your why is vivid and strong enough then you'll crawl over broken bottles to to make it happen and you'll ride over the inevitable speed bumps that occur along the investment journey but also if you're clear on where you want to end up then it's a compass in that every decision you're making day to day is based on well is that taking me closer to that or further away so that north star that comes out of getting really crystal clear on exactly you know what the end game looks like is a and the wire that's attached to that is a really important

Starting point is 01:00:30 thing that i sadly see a lot of people ignore thinking it's all woo woo and and and rubbish but uh i can i can tell you from personal experience and and for those that i've helped over the last 20 odd years it makes a massive difference to the commitment to actually making it happen and sticking the course so well i love that you shared that if you before i jump into the the first round of our ambush bushfire round, Michael. If you were starting out again now, would you have done anything or invested anything differently? No.

Starting point is 01:01:06 Look, like I said, I try not to live with regrets. I think we make choices and we just have to live with them. I don't think I could have done anything differently. There's only so much you can know at any point in time, and continual learning is how you become more knowledgeable in a certain field. So, you know, obviously I know a lot more now than I did back then, but I've had 10 years to learn it.

Starting point is 01:01:33 So, no, look, I think I did the best I could with the resources I had and the people around me and the knowledge that I had at the time and the thing that really made the difference was I just took action and I did it. It's spot on. And again, in full respect and admiration of what you've done, to be thinking about passive income at the age of 15, very, very few people I've talked to have even started

Starting point is 01:02:01 to contemplate at double or triple that age, let alone at 15. And then once that penny had dropped, taking the action and working really hard to actually put the deposits and the equity together to be able to achieve what you've achieved at a very young age and then pretty much set up your life as a consequence of that because I guarantee you wouldn't have been able

Starting point is 01:02:26 to even think about being a buyer's agent if you hadn't have built up that nest egg early in the piece because you just wouldn't be in a financial position to be able to afford to run a business for a couple of years without having that behind you. So I got a lot of admiration for what you've achieved in that regard, mate, and I have no doubt that it's only going to go from strength to strength from here.

Starting point is 01:02:47 So, mate, I now want to jump into the first part of what I like to call the ambush bushfire lightning round where I ask you some really quick questions to get your thoughts on. And the first of those, mate, is what superpower do you wish that you had and why? I suppose from an investment perspective, we'd all love to know, be able to predict the future. That'd be a great superpower.

Starting point is 01:03:15 But, yeah, no, I think superpower. I think you've covered it right there. The number of times I've said if only I had a crystal ball that would tell me what's going to happen with property in the future, then that would have made life a whole lot easier. So I think you've covered that off really well. Jumping into the next question then, Michael, what do you think would be the title of the book that was written

Starting point is 01:03:44 about you if your worst enemy wrote it oh probably the the tight ass who owns property i love that that that that is awesome mate off the top of your head sorry to interrupt i know um the the answer to that question before the superpower um would would be to to um have more time yeah that's that would be my ultimate superpower to be able to control time slow time down yeah that's that that is a cracker that is a cracker i agree with you mate it's as i keep saying it's it's all about time at the end of the day uh next question and if you can have a coffee with anyone either alive or dead or famous or historical what have you who would you choose and why um i know he's a you know everyone talks about him but uh robert kiyosaki i

Starting point is 01:04:41 think would be a great person to have a coffee with uh he was one of the first books i read was rich dad poor dad and it really shaped a lot of my my thinking and my um sort of ideas around world creation and yeah so i i think he'd be an awesome person to sit down and have a coffee with yeah Now, I tell you what, if you look at the legacy that he's created through that book, I'm like you. I had my Kiyosaki moment back in the 90s, and that was a life-changing moment for me. I actually went and saw him live.

Starting point is 01:05:13 He was in Adelaide, and so my mate dragged me along, and then I read all of his books. I played his cash flow game. It really completely flipped my lid in terms of the way I looked at the world from that point on, and I wouldn't be sitting here talking to you today if it wasn't for Robert Kiyosaki, mate. There's no doubt about that. And it's a timeless, timeless time.

Starting point is 01:05:32 It's as relevant today as what it was when I read it in the 90s. So awesome. Now, last question of this round. If you won $20 million tomorrow, what will you do with it? Bushy, $20 million, that's a lot of money. That's more than I need. So I'd probably give a bit of it away, to be honest, and just try and help as many people as I can.

Starting point is 01:05:54 And I'd obviously buy that dream acreage that I've got in the back of my mind just constantly burning there. But, yeah, I'd do that, set that up, and then just help other people as best I can. Yeah, I love it, mate. Well, look, I really want to thank you for taking the time to share the ins and outs of your personal journey, Michael. It's been great.

Starting point is 01:06:17 I'm really looking forward to deep diving into the Buyers Agency piece next week. And I just want to mention before we close off that if anyone would like to ask Michael any further questions on his property investment approach, or would like to discuss anything we chatted about with other like-minded investors in a very safe sales-free environment, I really encourage you to just join and jump on our Facebook Property Hub Collective Interactive Community Group, which you can do by just clicking on the link in the show notes. And we look forward to connecting with you there and continuing the conversation. So we now look forward to continuing that deep dive in next week's episode, Michael,

Starting point is 01:06:56 where we're going to unpack the benefits of local area specialists and the sort of intimate familiarity that is needed when it comes to securing your property. So again, thanks for your time. Remember to always get invested and we look forward to seeing you again then. Stay tuned for part two of this interview next episode. Thanks for tuning in to Get Invested on the Property Hub podcast channel, your home for property investment insights and inspiration. And don't leave yet until you've taken the next step towards living by design

Starting point is 01:07:25 by getting my award-winning book, Get Invested, absolutely free when you sign up at knowhowproperty.com.au or bushymartin.com.au. And finally, make sure you subscribe to Property Hub to get your weekly dose of Get Invested inspiration along with every episode of Realty Talk, Australia's leading property show for red-hot property investing news and insights direct from industry leaders and influencers. Remember to always get invested in your knowledge

Starting point is 01:07:55 and I look forward to seeing you next time.

Property Hub - Investment Insights & Inspiration - Get Invested: Part 1 - Michael Olivieri on investing in time

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