A young couple who turned a $480,000 house into a $20million real estate empire and had enough cash to retire at 25 say their key to success was buying properties with land, good ‘cash flow’ and strong ‘capital growth’.
Scott O’Neill, 32, and his wife Mina, 31, saved a $60,000 deposit for their first property in Sutherland, in Sydney’s south, in 2010.
Now they own 32 properties across five states and had so much rental income they quit their day jobs six years ago.
The pair started their own buyer’s agency to help others emulate their success and have shared their tips financial independence.
Scott O’Neill, 32, and his wife Mina, 31, saved a $60,000 deposit for their first property in Sutherland, in Sydney’s south, in 2010
They worked for years before they had enough in 2010 for a $15,000 deposit on this $480,000 home in Sydney’s Sutherland Shire
They now own 32 properties across five states and had so much rental income they quit their day jobs six years ago
The 32 properties – which are a combination of residential and commercial – are spread across Sydney, Brisbane, the Gold Coast, Newcastle, Perth and Adelaide.
The couple own eight commercial blocks, even have a property in Greece and spend at least three months a year overseas, Herald Sun reported.
Mr O’Neill said the key to success was ‘good cash flow and good capital growth’ and always looks to purchase properties with positive gearing.
The Sutherland house had a granny flat out the back and was renting for $680 per week.
‘If we bought a unit it would have been negatively geared, on a strata title with less rent because it didn’t have dual income like the house did with two separate leases,’ he told the Herald Sun.
That house is now worth $1.1million compared to units in the area worth around $600,000.
Their properties – which are a combination of residential and commercial – are spread across Sydney, Brisbane, the Gold Coast, Newcastle, Adelaide and Perth. Pictured: One of the pair’s Gold Coast investments
Of the 32 properties the couple own eight commercial blocks, even have a property in Greece and spend at least three months a year overseas
Although their first two purchases were in Sydney, Mr O’Neill said the market in their home town is no longer good value for money. Pictured: The pair’s Maroubra investment they have since sold
The pair said the secret to their success was buying property with land instead of apartments, and diversifying their portfolio.
Once the couple bought the first property they found that if they continued to buy properties that were positively geared they would have a ‘passive income for life’.
‘In this case, we were earning over $10,000 per annum net income after all costs — with the rent minus maintenance and rates, we still had about $10,000 in our pocket — so the idea came: if we could try and buy 10 we’d have a $100,000 income,’ Mr O’Neill said.
Since 2010 the couple have looked to place beyond Sydney to expand their property portfolio, buying unit blocks and commercial properties across Australia.
In 2014, Mr and Mrs O’Neill made their third purchase of a unit block in Port Macquarie, then almost instantly bought another unit block on the Gold Coast.
Each time they bought and got tenants in their passive income continued to rise.
They said they have looked for houses that can be subdivided and renovated to add value.
‘We bought a distressed house in Brisbane $40,000 under value, fast forward a couple of properties and we bought a dual income fish and chip shop with a 20-plus-year business tenant and a convenience store, a really big one that had been running for a long time as well — they made us feel safe to enter commercial for the first time, so we started looking at commercial property,’ the 32-year-old said.
The pair said the secret to their success was buying property with land instead of apartments, and diversifying their portfolio
Once the couple bought the first property they found that if they continued to buy properties that were positively geared they would have a ‘passive income for life’
The couple believes commercial property is the way to go as it offers higher cash flow and stronger yields than the residential market.
Talking to My Money in October 2018, Mr O’Neill said benefits of commercial properties were that they also had security due to longer leases, capital growth potential and tenants have to pay outgoing costs.
Mr O’Neill pushes budding investors to look for a $500,000 property in a capital city for their first purchase, and not to buy units.
The husband-and-wife duo said their best advice for investors is to not get sentimental and to treat property like a business.
One of their properties includes a four-bedroom Coomera Waters, Queensland, home (pictured) which they purchased in 2015 for $390,000