She's On The Money - How Property Flipping Helped Us Build the Life We Actually Wanted

Starting point is 00:00:00 Hello, my name is Natasha Nabanunga-Bamblett. I'm a proud Yorta Yorta, Kernai, Wolperi and Awadjeri woman. And before we get started on She's on the Money podcast, I would like to acknowledge the traditional custodians of the land of which this podcast is recorded on Awadjeri country, acknowledging the elders, the ancestors and the next generation coming through. As this podcast is about connecting, empowering, knowledge sharing and the storytelling of you to make a difference for today and lasting impact for tomorrow. Let's get into it. She's on the money. She's on the money.

Starting point is 00:00:36 hello and welcome to she's on the money the podcast that lets you be pervy about other people's money habits for educational purposes of course welcome back to another one of our Money Diaries, where I get the absolute pleasure of chatting to one of our incredible She's on the Money community members all about their journey. Let's jump straight into it because this week I got a message and it went exactly like this. Dear She's on the Money, my husband and I started out in retail, flipping homes on the side to boost our income. What began as a way to make extra money has now turned into a fully fledged business and our thriving property styling agency. Now we help homeowners increase their property's value so it sells faster and for more.

Starting point is 00:01:39 Our journey is all about turning a side hustle into financial freedom and we would love to share how we built wealth doing what we love with the She's on the Money community. Welcome to the show Money Diarist. Thank you. I am very excited but before we get there I have to ask the same question I ask everybody. If I asked you to give your money habits a grade from A through to F, what would you grade them? Oh, I would grade my money habits a C. Oh, a C. All right. I need to know so much more about that. Can you tell me a little bit more about your money story? Absolutely. So my money story, I guess, starts from when I was a young age, as most people do. I was always a very creative person

Starting point is 00:02:20 and I grew up in a household where my family worked very hard for the money. And I knew that they did that we grew up in regional New South Wales. And I think that my family did a really amazing job at shielding me of the impacts of how hard it was for them to go out and get that money. So that allowed me to grow up with, I think that sort of mindset of the money comes, but also allow me the space to be creative, which is where my talents were. So I think that although I'd like maybe not to be so shielded at times and probably why I give myself such a low score I'm very grateful for the journey that that has led me on because it I guess goes to show that creative fields often get a bad rap for not being well paid and I think that it is easy to fall into

Starting point is 00:03:19 that because of how hard you have to work at it but yeah I think that really it shows that where your passions lie, if you can find your sort of groove in that field, it can be really prosperous and you can really make it work financially if you just play your cards right and yeah, do the right things, make the right moves and keep at it. Totally. Tell me a little bit more about life. So you've mentioned in your letter in that your husband and I started in retail. How did you guys meet and were you always on the same money page? We have always been on the same money page in terms of believing that money comes and money goes and we very much work off the mindset that the money's out there we just need to go and make it ours in whatever we need to do

Starting point is 00:04:02 so I think yes in terms of how we got into property not so much he was very anti-debt anti-loan didn't want to get involved in any of that kind of like big debt he was had very strong views on that. And I come from the mindset of using other people's money or trying to use other people's money to make something of that. And so I sort of got in there and slowly but surely chipped away at his beliefs and convinced him to get into property. So we did meet through work in retail and have built what we have today because of the foundations of what we've worked on with our money and also the skills that we've gained with working through other organizations and that as well. Love. So tell me about your first property purchase. How did you save for

Starting point is 00:04:57 the deposit? How much did it cost? All of those pervy dates. So the very first deposit that we saved, we really scratched around. So I convinced him to buy a renovation project because that's what I wanted to sort of start with. And so we sold everything we had. We sold one of our cars. We had a really nice big boat that we had imported from the States. That was his pride and joy. We also sold that and we just went with that for as long as we could to scratch up as much as we needed. We talked to a lot of people as well that were sort of in the property real estate industry and developers and that and challenged the mindset of needing a 20% I think deposit which at the time was sort of you know everyone's like you need a 20% deposit to get into property and other people

Starting point is 00:05:46 were saying like no you don't really so we challenged that and we scratched as much I think as what we needed for I think we had like 4.9% or something like that so we were able to borrow off that and we bought a renovation project to completely strip and do up as our first renovation we gave ourselves 12 months to do it and we borrowed my parents caravan for three of those months and lived in the backyard slowly chipping away at renovating it to yeah do it up so fully gutted it styled it put it on the market 12 months pretty much on the dot later and made a little profit from it and did it all again. I love that. So what did you purchase for and then what did you ultimately sell for? So the initial purchase price was I think $430,000 for that one and we

Starting point is 00:06:41 sold for $650,000. Oh my god and what do you reckon you invested over that period of time to get such a good return? All up it was $130,000 investment. Oh how good is that? Yeah so for our first one, we were pretty stoked with that. I find that most people, when they do their first renovation, if they're like, look, I'm going to start flipping homes, they like completely underestimate how much this is going to cost in time, in energy, in effort, in like literally everything. And they blow their budget. And often you see, and you'd probably see this as well, people just breaking even. And they're like, oh, I'm glad I got out of that. If I do that again, here are all the things I would do differently. But to do that on your first time is incredible.

Starting point is 00:07:22 So we then used the equity and re-borrowed to do another one before we'd even sold that one actually. Oh my goodness. Which was a smaller sort of townhouse project. And we have always just been very open and creative to deals. And because there's always a way around, there's always someone that you can find that needs something from a deal, whether it might be cash, might be time, you know, there's always a way to be able to work something out that's a win-win. And I think that we have been very creative in our approach to that. I love that. So talk to me about you've gone from that first project, which you sold for $655,000. How many properties have you done now? I think in total, we must be on five.

Starting point is 00:08:06 On five? Yeah. Oh my gosh. We have put a pause on it for the moment and we'll have actually since COVID, we'll probably get back into it this year. We'll hope to get back into it this year, but we sold our last one the first weekend of the COVID shutdown. Oh my goodness. That is good timing to get out because then it like completely dropped. And I mean, it has recovered since, but like you were probably breathing a sigh of relief that you didn't have to go through home inspections while in lockdown, right? Yeah. Well, it was very interesting. I mean, in hindsight, you know, if we had kept it, it would have been a really good

Starting point is 00:08:39 position to be in. But it worked for us and we were able to sort of pull all of our money out of the property and invest that into the business that we have now. I love that. So talk to me more about the business that you have now, because it's come from being property flippers, hasn't it? Yeah, that's right. So we were involved in staging our properties for sale. So we really saw the impact in how that made to the presentation and to the engagement and that of people buying. so it really did impact our prices in most of our deals and so being able to help other people that are on that same you know trajectory in terms of their renovations or their builds is really nice but we ultimately yeah deal with it every day so we purchased this a little side hustle to support

Starting point is 00:09:31 our flipping and when COVID happened and we were unsure of what the property market was going to do we made the decision to pull everything out of property and invest it, throw it all at this staging because we were getting a lot of traction there. So that's what we did. And because we knew so many people in the industry, it's just sort of snowballed from there. I think because we come from that really like caring background in how like the impact that actually has on someone's like big asset, like for most people, property is the biggest thing transaction that they will deal with and being able to make that impact of 30 to 70 to 100k difference just with the investment of staging is huge and it's still not enough people are educated or know about that presentation

Starting point is 00:10:18 or think about the bias psychology that goes into the presentation of that space so it's really exciting and really fun and interesting and has so much to offer. I love that so much so getting back into the nitty gritty questions, what is your official job title now and how much money do you earn? So I'm self-employed obviously as a company creative director and my base salary I pay myself is 150k plus bonus. And then also I have a 50% profit share on the profits of the business as well. Oh, how good. So what would your tax return come out to on average each year? Tax through to, I think the last one was around $150,000. Yeah. So when you talk about bonus and stuff, that's not very regular because if your base is $150,000 and then bonus plus profit

Starting point is 00:11:08 share, does that mean like it's not there yet or like I'm just trying to gauge like how much you get to take home? Yes, absolutely. So it's sort of anything from $300,000 to $500,000. We do invest a lot back into the business. Yeah, fair. As most small businesses do, right? Like I feel like everyone's like, oh my God, is that all profit? And then it's like, no, no, that all has to go back into inventory and stock and staff and logistics and all of the boring stuff. Yes. Yeah. And we have in the last five years, we have very strategically reinvested much of it back. So we sort of say feed the beast. Yeah, 100%. So between furniture and team member investment has been a big one for us this year. Yeah, totally. And is your husband employed by

Starting point is 00:11:58 that business as well or is that just you? Oh, cool. And are you both earning about the same? Yes. Oh, awesome. How good. All right. Tell me a little bit more. You've obviously got some good income in addition to building a really solid business. What are your big money goals at the moment? Is it to like get into another property to flip or are there other things going on? Yeah, absolutely. So we have been working very hard also. Everything that we do or the way that we manage our money is very sort of structured. And we have been working on the last few years to strategically create investment money. So we're looking at a commercial investment to support our business in warehousing. That's one of our biggest costs.

Starting point is 00:12:41 Yeah, that would be one of the hardest things, right? Because like if you're doing property styling, I'm assuming you have a lot of big, large, bulky items to store. Absolutely, yeah. How are you managing that at the moment? Well, the good thing is that it's always in and out. So if we have a full warehouse, then we're not necessarily doing that great. Oh, thank God. Like I can't imagine. You're like, yeah, so I just have to store like seven couches. Like, oh.

Starting point is 00:13:05 Yeah, we know we're talking hundreds. Oh my goodness. Hundreds of them. So if they're obviously all out, but like, what if not even half of them are back? Where are we keeping like 50 couches? So we have around 2,200 square meters of warehousing. And that means that at Christmas time, especially when the market sort of slows right down and a lot of things come back, we are very full. Yeah. Wow. Oh my goodness. And obviously purchasing or like going down the commercial route would make a lot of sense in that aspect because you're probably paying a lot of rent to somebody else at this point. That's right yeah so

Starting point is 00:13:42 we're currently exploring that option as well as some other sort of share avenues as well just to start to get that money working a little bit harder from our savings. So good all right let's go to a really quick break and on the flip side I want to talk a little bit more about investments and then debt and your best and worst money habits so guys don't go anywhere. All right, Money Diarist, we are back. And you mentioned before that you are trying to free up some cash to make some more investments. And I want to know more about that. What investment strategy are you planning on implementing over the next few years? So particularly real estate. That's obviously where I am. Really? I did not see this coming from you. That is actually so crazy.

Starting point is 00:14:24 Yeah. So commercial real estate is one of our big strategies that we want to get into and also some back into what we're passionate about and where it all started in that residential sector as well. I really like the concept of having residential properties to rent that provide that sort of cash balance and flow there. Love. And do you have any other investments in any other areas? Currently, no. Cool. Very cool. Do you pay yourself super as a small business? Absolutely. So you do have other investments? Oh, well, sorry. Yes. so talk to me about how you're handling your super because I feel like small business owners always overlook paying themselves super and then it's 10 years down the road and they're like I

Starting point is 00:15:09 wish I started this earlier when you were setting up your business and obviously you guys are able to take out some like nice profits to have I would say a relatively comfortable lifestyle when did super enter the chat so I will be honest we did not pay super in the first year and a half Neither did I. Do not worry. You actually have no money. We had no money. We were out. Yeah. We felt broke because we were in the first year. Yes. Yep. Because we were. That's 100% right. But by second year, we knew how important it was. We knew we needed to get our ball rolling. So we doubled it up when we could. And now we just consistently pay a little bit more than what's needed. Oh, good. Good. All right. Talk to me

Starting point is 00:15:56 about debt. You said at the start, like getting your husband to purchase his first like property with you was really hard because he was really averse to debt. Talk to me about the debts that you currently have and how you guys feel about them. Personal debt is only, we only have our mortgage. Business wise, company wise, we have obviously a lot between vehicle loans, mostly vehicles actually, and some furniture loans. But yeah, besides that, our loans are obviously a lot bigger now because you know when you have multiple trucks and vehicles those loans are not cheap to come by yeah because we're not just to be clear for everybody playing along at home you didn't go out and buy yourself a Ferrari we're talking about vehicles to transport furniture for your

Starting point is 00:16:38 business am I right yes that's right yeah because some small business owners have a luxury vehicle inside their business yes and I'm very well aware because he did also sell a sports car when we got into this I'm very well aware and reminded very regularly that I owe him both a boat and a sports car okay yeah I mean they're both very good goals so I'm thinking bigger yeah absolutely so no we haven't treated ourselves to any kind of luxury things at this point even our house is uh although it's renovated we did have kept one of our renovation projects no I love that I think it's important. Yeah. So it is, apart from those loans, we try not to, we try that if we're going to get into debt for something, that it is for something that's going to work towards achieving

Starting point is 00:17:26 our long-term goals financially. And I think that that his mindset now, he can really see the power of that. I know that when we did first start in the business, we were using a lot of the business's cash. So reinvesting a lot of the cash because we couldn't get loans. Yeah, absolutely. You've got to prove yourself in a way that's the hardest period of business right where you're like I have no track record but I promise I'm good at what I do that's right and it's hard to particularly with the loans that we have they're not just regular like it feels like you have to really sell people but you know we want furniture but this is what it does and yeah it's actually an asset for our business in the same way like a beauty therapist would buy a laser machine we

Starting point is 00:18:08 need to actually look at this and what even like depreciation on these pieces of furniture looks like. So I'm assuming that there are a lot of spreadsheets. There's a lot of spreadsheets and we both really enjoy them. And he actually is extremely good at spreadsheets, thank goodness. But yes, there's a lot of debt there, but it works for the business. Yeah. Awesome. Yeah. So it's been a very interesting journey, I suppose, from that mindset. Totally. So talk to me about what you think your best money habit is. My best money habit would be saving. I always put money aside from my personal gym habits, my personal care, my personal development. So I'm very good at that. And yeah, I think that that's really paid off. I adore that. So tell me on the flip

Starting point is 00:18:51 side, what do you think your worst money habit is? The same. The same. I think that I'm such a good saver sometimes. And I focus so much on saving that I forget to maybe reward myself with my own money. I mean, that's not the worst thing in the entire world. But at the start of this episode, you did say, look, V, I reckon my money story and my money grade is a C. But then you're like, oh, I flipped properties. We really are responsible with our income. We pay ourselves well because the business is doing well. But I mean, we don't take a lot of profit out. And this is how we're reinvesting. And this is how we're thinking of investing into the business. We want to talk about commercial real estate and maybe we'll get back into like flipping properties

Starting point is 00:19:34 ourselves. Girl, what are you talking about C? And then you're like really good at saving and then also your worst habit is saving. Like, how are you a C? Please tell me. Look, when you put it like that. I'm like, hold on, hold on, hold on. Like the story's not checking out. We could upgrade that to a B perhaps. Yeah. Like, I mean, that's fair, but why are you being so harsh on yourself is the real question here. Sure. This is always something that you can learn, especially with money. We're really not educated with like what are the best decisions for multiple scenarios, I don't think. So even

Starting point is 00:20:10 as an adult with so many different opinions, you know, it's hard to really be confident that, you know, what you're doing is the best for what you've got there. Yeah, totally. Yeah. I think just being like open to having all of those different things sometimes can make me be a bit harsh on how I'm grading myself. I feel like the more successful people get, the harsher they are on themselves because they're like, oh, like I didn't know this and I thought I was good. And then like two years later, you're like, oh my goodness, like what else don't I know? So I feel like it kind of makes sense. If you went back in time, what is one piece of advice that you wish like younger you had when you were starting your property styling business? Younger me had

Starting point is 00:20:54 probably would have been to be okay with failing forward just lean into that lean into that little bit more earlier on yeah fair fair be it with money and other business decisions and just kind of life in general just be really comfortable with that failing forward and don't let it get you down so much when it does happen I feel like that's the hardest thing though like we all don't want to fail but if you don't fail you don't learn and if you don't learn you don't grow and that's like the worst outcome absolutely it's worse than the failure in itself right exactly oh my goodness I wish we had so much more time because this has been so fun but thank you so much for doing a money story it has been an absolute delight getting to know you and your

Starting point is 00:21:40 business and what's going on because I feel like we've all learned a lot from it so thank you you're very welcome thank you so much for listening to me the advice shared on she's on the money is general in nature and does not consider your individual circumstances she's on the money exists purely for educational purposes and should not be relied upon to make an investment or financial decision if you do choose to buy a financial product read the pds tmd and obtain appropriate financial advice tailored towards your needs. Victoria Devine and She's On The Money are authorised representatives of Money Sherpa PTY LTD ABN 321 649 27708 AFSL 451 289.

She's On The Money - How Property Flipping Helped Us Build the Life We Actually Wanted

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