How Sydney man owns two properties starting off with just $40k

The Woolworths employee, single and in his mid-30s, thought he had missed out on the chance to buy his own home. Then he had a light-bulb moment.

A Sydney man has managed to nab two properties in a year and is well on the way to purchasing a third from having just $40,000 in savings.

Brendon Hillsley, from Kellyville Ridge in Sydney’s northwest, thought it might be too late to break into the property market as a single man in his mid-30s.

“I always had in the back of my mind that I wanted to invest in property but never thought it was achievable,” Mr Hillsley told news.com.au. “You hear the stories you need massive deposits.”

The Woolworths employee and former butcher started to research property and came across a book that made his dream feel more attainable.

“The thing that interested me was how to start a property portfolio with $40,000. I had $40,000. I read it cover to cover.”

The aspiring homeowner recalled that “straight after” he reached out to the author to help him with his real estate journey.

The book was written by Lloyd Edge, a property agent who has 18 properties of his own worth $15 million.

Using Mr Edge’s advice, the Sydney man was able to snap up two properties in 12 months and against the backdrop of rising property prices in 2021 as well as significant renovations, his portfolio increased in value by 37 per cent.

Brendon Hillsley, from Kellyville Ridge, owns two properties from $40,000 in savings.

In July 2020, Mr Hillsley bought a property in regional NSW, in Armidale, for $229,000, after being advised that houses in that area were more affordable and also had a high rental yield.

The 1000 metre square block with an older style 1960s home was listed for $258,000 but he was able to negotiate the price down, saving him some money that later went towards his stamp duty and renovations.

“It was when Covid had just hit, the market had taken a little tiny nose dive,” Mr Hillsley explained.

“$40,000 was more than enough to cover the deposit and the lenders’ mortgage insurance (LMI).”

Mr Hillsley opted to pay 12 per cent of the house price and covered the other 8 per cent needed for the 20 per cent deposit through LMI.

He said “apparently that (12 per cent) is the sweet spot” as it maximised the money he was able to keep in his own pocket while also not having an exorbitant amount of LMI to pay.

Mr Hillsley’s house in Armidale.

Mr Hillsley thought he had missed out on his chance to own a home.

The leftover money, just under $20,000, went into renovations.

After six months of renovating the place — with Mr Hillsley calling in some of his tradie friends to get reduced rates — he started renting it out.

“When I bought the property it was renting at $305 but when I put tenants in it was at $360 (because of the renovation),” he explained.

It is a positively geared investment.

In another stroke of luck, Mr Hillsley had his property revalued and the bank estimated it was worth $290,000.

“So I released $50,000 equity.”

The Armidale house’s bathroom before his renovations.

The Armidale house’s bathroom after his renovations.

Using the extra $50,000, Mr Hillsley was able to leap-frog onto his next property transaction.

Exactly a year to the day of his first purchase, he scored a house in Cessnock, in NSW’s Hunter Valley region, in July last year amid Australia’s property craze.

“It was little closer to Sydney, it was poised to have more growth,” Mr Hillsley recalled.

And that certainly proved to be true.

He snapped up the three-bedroom, one-bathroom house for $385,000 but it was recently valued at $550,000 — and that was when he was still midway through renovations.

“A few months ago the motor on my car blew up, I was using the money I had at the time to do my renovation,” he said.

“I needed some money to buy a new car so asked to revalue to the property.”

It was here he was stoked to learn the property had skyrocketed in value by $165,000.

The Cessnock house’s bathroom before his renovations.

The Cessnock house’s bathroom after his renovations.

Mr Hillsley fixed his mortgage so he doesn’t need to worry about rising interest rates for the time being.

In all, both properties cost him $614,000, but they are now valued at $840,000 all together.

That’s a 37 per cent increase on his initial investment.

This whole process has taught Mr Hillsley to be a more stringent saver.

“I learned about delayed gratification, I really tightened the belt buckle up, drew up some budgets and spread sheets and started managing my money better, reigning it back in, it became very achievable,” he said.

“A lot of for me was a lot of impulse buying and eating out too often, especially when you’re working in an office with nice cafes.

“Investment is the key to retirement and getting out of the rat race, you’re never going to get to the point where you can retire comfortably.”