October 26, 2016
Dr Tony Hayek is the CEO and Founder of Blue Wealth Property. This is the story of his first property purchase...
Tony was working as a junior in a property company and was chasing the Great Australian Dream. Being surrounded by property he was keen to get into the market and buy his first home.
He managed to make it happen at the age of 28 in 2002 for $595k in Carlingford, Sydney. It was a red brick home circa 1968. It had shaggy carpet, 1970s style built ins and a couple of rooms had arches. The kitchen was daggy old oak and the walls were apricot. The bathrooms and laundry had old green tiles and were in desperate need of an upgrade. It had a Pebblecrete balcony with an old green railings about knee high. The concrete driveway was cracked and whilst the garden was neat it wasn’t functional at all, with garden beds running through the backyard and a clothesline in the middle of the only useable part of the yard.
It wasn’t pretty and needed a major overhaul.
At the time banks were only lending 90%. Tony had enough to cover costs plus 4% of the value of the property so he approached a friend to lend him the rest. He repaid this at a slightly higher interest rate and once the property settled, allowed the friend to take a second mortgage over the property.
He approached another mate to fund the renovation of the property and once the renovation was complete he refinanced the loan to repay the friend.
It was a game of creative thinking and juggling loans - but it was the only way he could do it. Whilst this is not a tactic he would recommend to first home buyers, he encourages them to think outside the square.
Tony stayed in the house and is raising his 3 children in the 4 bedroom family home. He is quite attached to it for sentimental reasons from watching his family grow up there.
He has recently started building his next home and plans to sell the Carlingford property next year. The romantic in him wants to make sure it ends up in the hands of another family, but if a developer wants to pay an extra $100k for it, then the romance goes out the window.
The home doesn't suit the profile for a good investment and Tony plans to use the sale proceeds to repay debt on his new home.
Tony’s advice for first home buyers today who are struggling to buy their dream home is to continue renting and buy an investment property instead. The advantages for first home buyers is that in today’s environment with the interest rates so low, it make it pretty cheap to hold property.
To brainstorm strategies to make your first home dream a reality, please call me. I'm happy to help!
If you would like to attend the next Blue Wealth Property seminar, we can arrange a complimentary invitation.
07 3366 8604