Hosted By Tyrone Shum

Explosives to Home Improvement: Jane's Renovation Ideas

Updated 24/05/2017

Jane Slack-Smith is a two-time Australian Mortgage Broker of the Year recipient, best-selling author of Your Property Success and head of a property investment advice empire focusing on home renovation.

Now one of the defining voices of property investment in Australia, originally Slack-Smith was a mining girl from Dubbo with no plans for the property. But as she’ll reveal in this episode, one reading of Robert Kiyosaki's Rich Dad, Poor Dad, changed this farm girl into Australia’s recommended property investment teacher.

To begin with what do you actually do on any given day?

In a given day I might have three to four discovery calls with new clients who are looking for finance, and we just work out whether we're a good fit in working together because I don't believe that everyone works together well, so for me, it's really important in providing some understanding of what each party needs in a relationship so that we can go on because I really want to be a part of people’s long-term goals rather than a one-and-done kind of loan provider. And then, the rest of the time we're usually in pre-production for podcasts and videos and looking at how to do virtual reality, exciting things with our new videos and looking at how we can update our courses and material for our students. A lot of time is spent assisting the community in our private Facebook pages in answering questions and putting them in touch and getting them to the results that they want. So yeah, a pretty full day.

That's Jane Slack-Smith, a mother, a miner, an award-winning Mortgage Broker and property investment educator who is the author of the popular book ‘Your Property Success'.

However, it didn’t all start that way. As a girl from the bush from a farm in Dubbo, I was one of the first to attend a university in my family and I did a mining engineering degree and specialized in explosives. So, I spent the next 18 years working in the mining industry, which was very exciting. In that period of time, I knew that I was probably just working for my money day in and day out and doing nothing with it. And, I knew I had to do something, and I had a come-to-Jesus moment with a reading of Robert Kiyosaki’s 'Rich Dad, Poor Dad' and started to think more about my future and what I wanted to achieve.

I took my risk assessment skills in understanding risks and likelihoods and consequences of risk to property investment, and built a property portfolio from a mere $45,000 start, way up to a multi-million-dollar portfolio today, and decided along the way that I wanted to teach other people how to do it too. So, I essentially started looking into how I could assist people in their education on how to find the right property in the right area, to get them to their goals quicker. And, I realized back in 2004, 2005, that if I did that without having professional indemnity insurance, I was probably going to put some risk around my own portfolio, and the only person, or profession, at that stage that could talk about property was a mortgage broker.

So, I decided to do that part-time; that lasted about three weeks because of the demand of people wanting some assistance. And, I went full-time and since that start way back in 2005, I've won Australia’s Mortgage Broker of the Year twice and property investment adviser runner-up in a recent award, which I'm really proud of. And then, in 2012, I decided it was time to put all the education and knowledge around property investing and building my portfolio and all of the thousands of investors I'd worked with into play, and started Your Property Success which is an online education platform that assists people in getting to their property success. So, that's essentially me.

Slack-Smith describes herself as a person who's perpetually curious.

I always want to learn more and I'm always signing up for courses. And, something like James Patterson teaches how to write because I'm interested in how to convey my message and be a better writer. I don't necessarily want to write a book; I have written one book, 'Your Property Success with Renovation', but I don't plan on writing anymore. It just intrigues me, looking at people who excel at what they do and short-cutting the path of pain that they've been through, and learn from their mistakes, learn their recommendations so I can put those things in place. So, I do courses on photography, writing, marketing obviously, finance; I'm always looking to learn more and I'm always curious about what people are doing so that I can learn from their experiences as well.

Wow, where do you find the time to do all this?

You just have to get up early and you can achieve anything.

Now not only is Slack-Smith’s professional life amazing, her ability to run that side by side a busy home life is remarkable. Slack-Smith explains how she balances so many roles and what brought her into property investment.

My husband was the consultant in IT and with that portfolio he stopped work when he was 42, I think. So, he is now following his dream, which is being a full-time artist. He does photorealistic art, and you can have a look at Beautiful works; they go into The Archibald and the portrait exhibitions in London, etc. So, he's following his dreams and unfortunately, I don't have a hobby that I could check out with and spend all day at. My hobby is kind of teaching other people, so I'm also following my dream and doing what I love, which is helping others. And, I've got a nine-year-old son who keeps us entertained. As of the weekend, I am the proud completer and designer of a Nerf gun arsenal story shadow board. So you know, the things that I can do are amazing. [Laughter]

Family always is fun, especially with children as well.

You never know when someone’s going to jump out from behind a wall and shoot you with a Nerf gun in my house.

Why did you choose mining of all things?

Well, I had a very wise person tell me once that it wasn’t really important what you studied, it was the fact that you learned how to study and learned how to learn. So, I knew I had to have a scholarship to go to university; my family couldn't afford to send me off. I looked at where the scholarships were, where my skills were. They say that you have three careers in a lifetime these days, and on today’s life expectancy, it's soon to be a whole lot more in a few years’ time.

I think it's more than three now.

Yeah. So, I knew it wasn’t a job for life; I knew it was an opportunity to learn. I had a lot of strengths in engineering. They were looking for girls in engineering then, and although I don't believe in affirmative action, at the time I kind of stumbled into the fact that there was promotion of women in engineering. I looked at all the different engineering courses and a lot of them just seemed to be boring. You're designing something and you never get out there and do things; and mining engineering, you learned a bit of mechanical, a bit of civil, you did surveying and geology, and you're in a ute driving around big mines, telling dozer drivers what to do and blowing stuff up.

I worked underground for a year on night shift as a laborer because there's a belief that you can’t become a manager and tell other people what to do until you've done it yourself, which, I grew up with cleaning up stables on the farm, so we were always pitching in and doing things. I was the first girl to work in underground coal mines. Another girl and I turned up at the same day to different mines after they changed the laws back in 1989 to let women underground. And, everyone went on-strike and I was like, oh, okay. It’s amazing to think in our lifetime that there were still those kind of things going on. There were some adversities to get over and you just had to get in and do the work and prove that you were willing to learn, and that's what I did.

I had a really great relationship, had a wonderful career and very successful career in the mining industry. But, after building a really good portfolio and having so many people ask, how do you do it? Sitting on a mine site on Mount Isa, waiting to push a button for a mountain to blow up, kind of thing. People were asking what to do, and I was doing all these kind of toolbox talks at mine sites all around Australia and I was like, well if people are really interested I could teach this, and I like teaching. So yeah, that's kind of how I moved from mining onwards.

So how does one go from the first woman qualified to run an open cut coal mine in NSW to ‘One of Australia’s top ten finance experts’?

So what I was doing was, at that time I was working for a company that was an explosives company, and as an expert, different mine sites would ask me to come and design glass for them or do safety audits, or do instant analysis of something that went wrong. So, I got, by virtue of that, to go to most mine sites throughout Australia. And, whilst I was on the mine sites, they’d go, hey, what have you been up to? And I'm like, oh, well I'm going back to Sydney to renovate a house this weekend, and they're like, what? Tell me about it. So, naturally one thing would lead to another and they're like, how are you doing this? And I'm like, how are you not doing it? We're on the same income. Then we started chatting about, well, how can you make your money work for you rather than not work for you and you work for your money, said Robert Kiyosaki. So, yeah.

As you know Slack-Smith shared that she got into the mining industry after completing her university degree and that's where her property investment journey begun.

Well I, like most people, allowed my – I went from a university income of $10,000 a year to a first-year out graduate income of like, $75,000 a year and my lifestyle expanded to my ….[Laughter]

Quite substantially, yes.

Yeah. I remember getting my first credit card and going, oh my gosh, this is amazing. I can buy an Oroton handbag and I don't have to pay for it. And then, I realized a few months later that I did have to pay for it. So, I was very much into that disposable world. I hadn’t come from an affluent background, so having money, I could help my parents; I could help put my sister through school and put her through university; I could go on holidays. I did all of that and I didn't save a lot.

And then, when I hit 28, sat down and had the moment with Rich Dad, Poor Dad, I thought, oh my gosh, what am I doing? I'm going to have to help my parents when they retire because they'll be on the couple’s income because they haven’t got investments that they can fall back on. And, I've only got a certain amount of time to do this. So, I smartened up and I read a lot of books about budgeting. I decided to withdraw all of my pay every week and, I'd had green money, silver money, gold money, so I'd have savings money, I could spend and save, and money that was available for very long-term savings, and I built up savings of $45,000.

I bought my first property for $425,000; $25,000 went straight to stamp duty so I had a 5% deposit. Then nine months later, that $425,000 property was revalued at $700,000, so I took a personal loan out and did a $50,000 renovation, and then I put out $100,000 and went to Sydney and did it for the next property, and pulled out money and did it again. I built up the portfolio very quickly by using no more than that first $45,000 to contribute to buying the properties.

Wow. How did you feel when you bought your first property?

Oh my gosh, like I've felt since every property since, buyer’s remorse. You're like, oh my god, what have I done? And then, you sit down and you go, I've done the numbers and I've done the research, I understand the risks and I've minimized the risks; it's right. I think when I speak to clients, and we've got people putting in offers on properties every day, and I do deal reviews for our clients to just make sure that the property fits their buying criteria.

Every single time, those people who are not feeling buyer’s remorse, I have a few worries about and I make sure to ask some extra questions, because I think you need to – we're not talking about buying a packet of chips. We're playing with hundreds of thousands of dollars and the potential to create financial freedom in the future, so it's a big decision and I think it should be taken not lightly. So, buyer’s remorse, I think that's a good thing.

Slack-Smith explains she was very resistant to property investing when she initially got started even though it is her preferred investment vehicle to become wealthy.

Very resistent! My boss kept saying to me, when are you going to get a mortgage so that I know I have you for life? I just thought, oh my gosh. The word mort is death, right? So mortgage means death and I was thinking, well there’s no way I'm going to be tied down to the white picket fence. I'm footloose and fancy-free and I'm only 28. So, I had a lot of fear around the property investment, and like a lot of people I didn't realize that you could invest in property without owning your own home. So, I decided that I need to create a financial future of security for myself. After I read 'Rich Dad, Poor Dad', I went and signed up to Australian Stock Exchange courses and I did all of their courses. And then, I spread-sheeted and paper traded all of these shares on a spreadsheet. Didn’t actually put my money in my pocket for anything.

I couldn't believe it; I'd come up with this great analysis of a company, and they’d then go and change the board or they’d change their strategic direction and all my research had gone out the window. I’d think I’ve got no control. And then, for my 30th birthday I decided that I would pay for three financial planners to assist me in putting a plan together. Two of them just wanted to go into shares and that's when I found out that financial planners are really salespeople. It was the power planners in the background that were doing all the work, but they were only confined by – they were allowed. So, that really confused me. One guy wanted to day trade shares for me, which I don't even think financial planners could legally do.

I asked them about property and they said, well financial planners are not allowed to talk about property because it's not a listed security class. So, that all changed just a few years ago. I was kind of on my own so I made this investment, my $45,000. I took the – I basically monitored what the shares would have been done under the recommendations of the two brokers and financial planners and I did my property investing at the same time. Obviously, I made like $175,000 in nine months with the property investing. One lot of shares that, if I would have put my $45,000 in, would have gone up to 50, and the other one went down to about 42. And, my husband had done property investing in New Zealand where he was from.

He had a little business while he was at university, mowing lawns, and there was like a 24-year-old guy who said, come mow my investment property lawn. He said, you did a good job; come and mow the other ones, and my husband said, how did you get so many? And he said, the first one’s the hardest. Once you get the right ones, the first one, you can build your portfolio. So, he was really inspired. When we started dating, he was telling me about property investing and I was still very reticent. I was a reticent latecomer to property investing, albeit the fact that I did buy my first property when I was 31.

Teaching Home Renovation

After building a multi-million dollar property portfolio, she wanted to share what she had done and that's where her love for teaching started.

It was more about sharing. I thought, well if I can do this, I want to share this with my family and friends. So, I actively talked to – my best friends and my sister have multi-million-dollar property portfolios, and I wanted to assist them. Then their friends would hear about what they’d done and how they’d located a great property in a great area and rented it out quickly, or added some value through home renovation. But, it was all about the location that I felt was missing in the education, and that, as an engineer, that kind of Excel spreadsheets and using the Internet that was where my forte was.

So, just teaching people how to do that was important to me, and then essentially when people kept asking, I thought, at some point I need to have some protection around my portfolio in case someone takes my story as advice and it goes wrong. And, the only way I could do that was a mortgage broker. So, for me, although loans and financing is arguably the starting point to building a portfolio and understanding that and getting it right, I saw so many people set up with wrong loans and with banks who’d been trying to help them out but hadn’t structured them correctly, and limited their ability to buy and not achieve their goals.

So, my whole conversation with people around their finance needs is about what the goals are, and it's about the property. It's not about the loan and how the property fits into the portfolio to achieve the goals in the time-frame that people want. I guess I did things a little differently in the sense that to me it was all about that journey, having long-term clients and being on that journey for the long-term with them. So, I provide different services to most mortgage brokers because I want to facilitate I think the total package and what people need when they're buying properties. It's difficult to get when you're starting out.

And sometimes, it's really hard for people, married people who, one’s really keen to invest and the other isn’t; there's a lot of tension around that and often, there's a fear of losing your hard-earned nest egg. It's about taking the fear away by understanding the risks and minimizing those risks, and having a conversation about, it’s a step-by-step process. The location is key, and that's why we spend so much time where we've developed, you know the suburb selector software and all these different location courses and things to really help people target that, and tools like RP Data Professional that I personally, for my mortgage pre-approved clients, I paid the three months of the pre-approval period to give people access to that because I'm so focused on helping people make sure that they have the right resources, and to be able to find the right property in the right area. And so, there are some great products: you know, Ripe House and Micro-burbs.

There's a lot of free and unpaid resources, just takes a little bit of extra work to make them work for you, but there are also a lot of paid resources that people can use, and I think just having everything in one place where people can learn where to do it is really important as well.

Slack-Smith points out that she's a really low-risk type of personality and every single thing she did would have to ensure there were minimal risks involved, which led her to learn from others.

Being curious and a lifetime learner, I also wanted to read everyone’s books. I've got 135 books on property on my bookshelf at the moment and I really wanted learn from other’s mistakes so I didn't make them. I’d go to these seminars, and let's be honest. There’s not that much new stuff in property investing, and you go to the seminars and they’d be saying the same thing.

But, I then wanted to listen to the stories about what they did wrong because most of the people get up and go, I lost everything and then I rebuilt it. I want to know what the mistakes were they made to lose everything so that I never had to do that. I had the opportunity to jump on the shoulders of those giants, jump ahead and over the mistakes that they’d made. So, I can’t claim a devastating investing blow at all. I thought at one stage, that a property that I’d done all the research for in Darlington near Newtown in Sydney, was a bit of a dog. But, it did 25% last year. So, we're okay there.

I think you're doing well. What about the home renovation things.

Just a minute delay on what I had expected on the growth potential.

Slack-Smith saw there wasn't really anyone in the market who could share quality education and resources during her investing time and decided that she would take the lead in creating this type of community herself.

Absolutely. I remember there was this one guy; we talked about that he wanted a passive income of $50,000 in 10 years’ time, and he rang me up really excited. He said, I've found this property, and it was like Kempsey or something, not to say anything against Kempsey. I pulled up these Residex reports and I'm like, there's zero growth predicted and there's high vacancy rates. And he said, yeah but it's cheap. It's the guy next to my dad’s place and we don't have to go through an agent, so I'm getting it $10,000 cheaper. And, we could see that in the next 10 years, it was still going to be worth $250,000.

It was only costing $5,000 a year in the difference between his costs and the income that he would pull in, and it had nothing to do in getting him to the goals. It was that kind of "aha" moment when I thought, providing people with some thoughts and direction is one thing, but being very focused on delivering a quality education that people can go through at their own pace, not turn up for a weekend and get the rah-rah excitement, and then get back home and life kind of hits you in the face.

I wanted to have a resource they could go to time and time again. I looked around Australia and I couldn't find anyone doing online education that was kind of full of integrity and honesty, kind of like, here’s the facts; take the information and do it yourself. There are no steak knives being thrown in. So, I went to the States and I found an educator over there and spent a year being mentored, just flying backwards and forwards from Australia, learning the best practices and trying to educate people in the best in adult education, and made a success. [Laughter] Probably could have bought a house with what I have put into developing the education platform, but to be able to communicate those stories and sharings, I mean in the last five years, the community that we've built and the students that we have, they're just so lovely and so supportive.

People in the private Facebook groups, they might be saying, hey, there's a deal on Grays Online. I'm getting a ute together to go down and pick it up. Does anyone want to help, you know, I can pick up stuff for you and drop it off. Or there will be someone else saying, quick, I need a roof repair here and people are jumping online and giving people numbers. Or, here's a property I've been looking at, what do you think I could do with the floorplan? And, it's just the generosity of spirit and that community involvement that I'm just so proud of. That's what I wanted.

Slack-Smith says she get a deep sense of happiness and excitement to hear her clients succeed which continues to motivate her to help others every day.

Look, one of the things when I started investing, and that was, I was looking around 1999, 2000, so I guess all of my 17 years of investing was that there were a few books. Jan Summers, loved her books. Robert Kiyosaki, and there were a few educators out there. But, you never knew who to trust and there was always, buy my course, and it's a good buy. Or, get my loan, or get my…whatever someone was selling and it was kind of that feeling that it was a transaction. I genuinely – for me, it's about the stories and it's about the people, and it's about getting people to a place that might just be an ‘"aha" moment. I spoke to a lady today who thought that she could do nothing because her buying capacity leads her to a purchase price of $160,000, and we talked about areas and the fundamentals of low-risk investing and looking for infrastructure, population growth and economy growth. We highlighted a few areas that she could afford, and she was so excited that she said, this is a revelation to me. I feel like I can almost breathe again because I really want to invest but I feel that I can't get into the market.

It's just those moments that, for me, make my day complete which is really exciting for me. That's pretty much what we do is provide courses. The Ultimate Guide to Renovation is a premium course that comes out twice a year, in February and September. We have a Your Property Success Club which is a 12-month club giving people, at a much lower price point, but really good-quality information every month because I know that everyone can’t afford fancy courses. And, we do a lot of Q&A calls, monthly Q&A calls and support. For me, it's helping people get over maybe, just a tiny, little roadblock that they think could stop them and moving forward. And that moving forward to us is what we do what we do. It’s getting people to their goals.

There are new websites popping up all the time, and it's really exciting to kind of test them out and try to break them and see how I can manipulate them for my community’s better good [Laughter]. So like, hey, instead of paying for access to doing like, a half an hour trying to find this information or census, if you go to this website you can find it in a few seconds. I think as an investor, we can waste hours and hours in the Internet searching without really knowing what the destination is. Being really clear on the goal and then the buying criteria, and then finding the suburbs and the pockets of potential within the suburbs, and then the right property to suit the demographic, you follow those simple steps and you're working with the, I guess, foundations of a really good portfolio.

7 Properties With $1 Million Equity A Year: Jane Slack Smith

It was an exciting story that originally started in the mines of Western Australia. Today we turn to mindset and begin by asking if there was anything holding her back from investing in property.

Look, I know it's a bit of a tragedy but I run up against this regularly; I think concerned and well-meaning friends and family can possibly be something that can hold you back. I remember having a chat to my dad and he said, babe, you’d better be careful. One day, you'll owe $1 million, and I thought, I'd better not tell him I already do. So, I think a lot of people see – hear the stories around what can go wrong. I've spoken to a lot of people and I know there's people who have been on your podcast who are professionals these days, who started out because their dads were taken advantage of, and they lost the family fortune so they wanted to make the world a better place by making that not happen to other people in the future.

So, there are some terrible stories about things that go wrong, and I think the real estate industry does have a lot of spruiking and people who are in it for themselves associated with the industry. However, the wonderful thing is there are so many people that are genuinely out there to assist those and I think we've seen a real change in the real estate industry in the level of education and support. Even something as simple as a whole new industry of buyers agents popping up in the last ten years. There are so many different ways that you can get into property these days but there is also so much information available free and paid on the Internet that people can use to validate their decisions on buying. So, I think it's – it's a good place to be these days.

Next Slack-Smith reveals the values instilled in her from her mentor, that led her to keep going amidst the heavy obstacles of prejudice and risk.

You know, I was very fortunate as a child. My mum used to always say to my sister and I, you can do anything you try and you can achieve anything that you want to achieve. And, you can even fly if you have God’s help. She was very motivational, and we were always set up with the premise that we could achieve anything that we put our minds to, rightly or wrongly, you know. There have been some interesting experiences where I thought I could do things that possibly, I couldn’t. But, going into any situation thinking of success and visualizing what the success looks like has definitely been a key to everything that I've ever done.

When you're on a mine site and 300 men are on-strike because they don't want to work with a girl, you've got to sit back and go, why am I doing this and what am I concentrating on doing and why do I want to be here? So, understanding and being very much anchored by what you're trying to achieve is really important, and it's the same with home renovation and property investing.

Brendon Burchard was the first mentor I worked with at Expert’s Academy, and then I looked at how to actually deliver online education, the actual mechanisms and technology behind it, so I looked at Jeff Walker. And, I've recently been a part of the Mastermind group with Dean Jackson, who has a great podcast, I Love Marketing, and I genuinely love marketing. I love the opportunity to be able to talk to people and influence in the right way, a change of thinking that will then lead them on a journey to go on as a quest to learn something more. So, they're the people I'm working with. I'm actually, for the last year I haven’t been with a mentor and I know the importance of being stretched and held accountable with mentoring. And, I'm heading out to spend four days with a new mentor that I'm working with next week. He works with, I think, eight people a year. Really excited about that. It's kind of, what's the saying?

When the student is ready, the master will appear.

Yeah, grasshopper. So, I've been a grasshopper many a time and, as you grow and learn something from someone, it's time to move on. That's been a great opportunity for me, and I recently joined a fabulous group also, called The League of Extraordinary Women. Just a fabulous group of business women, incredibly successful, incredibly generous; they have wonderful events. Just listening to what other business people go through and what they've had as great successes and failures, and supporting each other is fabulous. I really encourage your listeners, if you are planning on property investing, find yourself a community where you can have a chat about it because it really makes for helping you get to your goals sooner.

The key to success in property investment is education, according to Slack-Smith, who discusses how a lack of Australian education resources led her to create her own community of teaching.

I’m on a constant quest for learning and doing my best at excelling at it. So, I really want to learn from those that are at the top of their game. Back in 2011, I was looking around and I thought, if I'm going to make my next significant investment it's not going to be in property; it's going to be in providing education for people so they can have good education and property. Who’s the best in educating? I wanted to see who was doing online education because obviously, if you're doing face-to-face education you're limited by the number of people you can effect change with. I had the opportunity of being the finance and property writer for Australian Women’s Weekly for a period of time.

I created some videos to help people work out how to get from their home to maybe their first investment property or buy their home a bit better. And I could see that their having access to something online was giving people the opportunity to learn in their own timeframe and be able to go back and look at it again. So, I thought, I want to find online educators who could teach me how to do this property properly and with integrity. I just didn’t want to be the, here's the steak knives. I wanted to be able to be authentic and be who I am and deliver the kind of no-BS message. So, it wasn't really covered with all the glitz and glamour.

I couldn’t find that in Australia so I looked overseas; I found a mentor there and I spent a significant amount of time flying backwards and forward, being a part of a mastermind group and being a part of a group of like-minded people and in a community – regardless of whether it's property investing or photography or cat raising, whatever it is that your passion is, being a part of a community of like-minded people, just being supported and understanding and speaking the same language is so important. So, I just got the most amazing learnings from that, and that's when I came back and started Your Property Success with the view of passing my knowledge and creating a community that could share their knowledge.

Practical, no-nonsense advice is the name of the game for Slack-Smith, which had led her to helping hundreds of Australians purchase sound investment properties under their portfolios.

I spoke to a lady last year and she had said to me, look we really got it wrong. We bought a house and land package in the outskirts of Melbourne. There were other developers there; there was an oversupply, so we had a house in the outskirts. It didn’t work for us, so now we're going to buy a unit in a city. I was like, how are you minimizing your risk? And she said, well it's not a house, it's a unit. And, it's not outskirts, it's in town. And I was like, the risk’s the same. It's an oversupply risk. And she's like, oh, I didn't think about it like that. It's kind of just getting people over that little 'aha' moment, like oh my gosh, I was about to repeat the same mistake, you know? So, it's interesting.

And that’s just one example.

I was doing one of the services that I provide for my pre-approved mortgage clients; if they find a property and they want a second set of eyes I do a review with them. This client kept coming up with these properties, and it's a review against their buying criteria. It just wasn’t meeting his buying criteria. We looked big-picture and the suburb actually didn’t meet any of the criteria. So, I was saying to him, look, if this buying criteria is what you need to get to your goals, then you're going to have to move to suburbs and do more analysis. And he was saying, it just taken me three months of analysis to do this; I don't want to move on.

It's like, well investing in this 10 to 15-year plan here, another three months and getting the right suburb so it delivers your plan for you sooner is probably better. Since he found the right suburb, and then the right property and put that one to bed. But sometimes, you have to kind of move on and sacrifice a bit of time. You do learn from it, and you learn to get quicker at the processing.

Yeah, it's like opportunity cost. At the end of the day, you’re sunk in cost. You can spend all that time and you've got to sometimes decide, is it really worth continuing to move on? Or, you keep pursuing it, and sometimes it's just better just to let it go. If it's not right, then you've got to move on to the next thing.

Exactly, and there's a grieving period there. I speak to a lot of people who are like…they might miss out on auction on the dream property they're after, but if you're very clear in what you want, it’s amazing how often, within the next 10 days, the right property comes up for them.

It's all emotion isn’t it, sometimes.

Yeah, you've got to separate it out.

Yeah, emotion versus logic. And, did you seek any mentors also for renovating as well when you were building up your equity through that path?

Look, back in like 2000 and 2001 when I started renovating there were no renovating experts out there. So, I really had to derive my own knowledge about what would work. Once again, I went back to the basics of, what's the risk? And, the risk is that you over capitalize or you renovate and people don't like the home renovation. My whole key around renovating and the reason I renovate was for the value-up; getting that valuation up so I could pull equity was the number one reason that I wanted to renovate.

The second one was to have it appeal to a renter so that the renter would rent it and I'd have low vacancies and high rental yields. For me, I then worked out that it was the pricing disparity, or the difference between un-renovated and renovated properties that was going to be the key to that strategy. Doing the analysis and finding out, what were the properties that were renovated on the market and how much were they selling for? What was the un-renovated property worth? How much would it cost me to get the un-renovated to the renovated, and was there a profit there? For a lot of suburbs, there is no pricing disparity between renovated and unrenovated. So many properties deserve to be renovated but very, very, very few should be. So, it was finding that out that was, I guess, the secret to the success that I then shared with everyone.

You’ve heard from Slack-Smith how she sought mentors and spent a lot of time learning and implementing. Now she reveals the details of her investment strategy, how she applied that strategy to real-world situations, and how you listeners can learn from her success.

I was always looking for the twist. So, how could I take a property and take it to a higher and better value. And do it as quickly as possible so I could create more equity to build my portfolio quickly because I didn't want to be an active property investor that is out there looking at properties every day. I wanted to have a set and forget portfolio that just goes up in value by $1 million a year. How nice would that be?

Nice; I'd join the club.

Essentially, I then went and did a lot – I was based in Melbourne at the time. I did a lot of research about the suburbs within 10Ks that I could afford. Most of them, I couldn't.

Then, I came up with three suburbs, which was Fitzroy, Collingwood and Carlton, and I just walked the streets and got to know them intimately, to the point where, you know, you go to auctions and predict the price within 1%. I knew that because I was going to use all of my $45,000 that, if I wanted to buy a second property quickly, I had to create equity because my savings would take too long. So, the home renovation strategy was around creating that equity quickly.

Slack-Smith said she wanted it as quick as possible.

I found a suburb that had the pricing disparity, Carlton. I then looked at what the fixtures and fittings and standards were that the renovated properties were selling for. And then, I looked at the property that I had and worked out how I could find those fixtures and fittings at a cheaper price that had the same perceived value but didn’t have that cost. So, it was around sourcing the right properties from the right areas, sourcing those and putting them in place.

To put in perspective, what kind of house did you buy in the Carlton area and what was the average price?

The average prices were around $400,000 back in 2001, and we kept driving up and down this street; it was one of the premium streets and it had one of these beautiful old mansions in them; three-story, 1860 built brick properties. And we’d say, one day this is our end goal. What came up was that two of these properties were being sold under the same bill of sale. Instead of saying, going once, twice, $400,000 it was going once, twice, $800,000; so, different titles, one bill of sale. My husband and I, or my then boyfriend and I, we were looking at buying a property each because I wanted to minimize my risk just in case the relationship didn’t go ahead. It's been very good. And your buying capacity; I knew that individually our buying capacity was going to be higher individually, and less land tax, etc., benefits. So, I knew strategically that buying individually was a good way to start.

These properties were three-story, 1860, beautiful old mansions essentially that had been built within a kilometre of CBD, Melbourne. And, completely hadn’t been fixed or touched for a long period of time. My husband had a higher buying capacity than I did and he took the one that had been – had the parking at the back and had a little bit more renovation done and mine was in a really bad condition. We actually used the pest and building inspection and we used the Residex valuation report as a part of the negotiating tool because we got to auction; it was passed in and we were the highest bidder. We went in and we said, gee, look at this pest and building report. It says it's got about $50,000 of work just to make it livable. And, the comparable sales in the street of this. Luckily, the vendor said, okay fair enough, and we got the property.

Good negotiation.

Yeah. And, having access to those material and reports, it's actually gave us some credibility rather than saying, I just don't want to pay anymore. So, they were sitting there and going, well if this person thinks this, the next person that gets a pest and building inspection, they're going to think the same thing. So, I bought it for $425K; I did the $50,000 renovation on it, revalued it nine months later at $900,000. In 2009, I did a bit of a top-up to it as well. It’s always rented since then at $1,000 a week. It's worth around $1.4 now, and great location, great property. Always in-demand. I've only other had three tenancy agreements in that 15 years, so people just keep wanting to rent there and yeah, it's a great little cornerstone for the portfolio.

That's great. So, from there, you were able to start that first property off, and then leapfrog to your next properties by drawing out that equity to buy a few other properties?

Yeah, and we were rentvestors for 10 years. We rented ourselves and bought investment properties. Often, we’d move into a little investment property. We had a little unit on the beach, there on Bondi Beach. We moved in there in the winter when no one wanted to rent and did a three-month renovation and enjoyed that, and then moved out and rented ourselves. So, often just to save some money, we were living in the renovations. And, anyone who’s ever done that, you know how bad that is. You’re covered in plaster dust going to work and you're cooking in a microwave for months on-end.

But, when you're making more out of the equity gain in a property within a few months, then you're making it work and it makes a difference. I know a lot of people look at those numbers and think, I'm going to give up work or sell the property and release the equity straight away. We’d always had the strategy, it was around a buy-and-hold long-term strategy and work was fine. I mean, I don't want to give up work. For me, it was around just having the choice to be able to work or not, but also, I knew that I need to have a job for the buying capacity which is so important, and with the changes of ASIC and APRA in 2016, investors have to be savvy about what they do and their financing and have the right income to be able to continue investing. So, I knew that I wasn’t going to be giving up a job any time soon.

Her property portfolio continues to grow with minimal effort and even though she doesn't need to work, she keeps her job because she chooses to. She points out, she’s a very boring investor when it comes to buying more property.

Well, great revelation here. I'm a very boring investor who walks the talk, you know? I wrote the book 'Your Property Success with Renovation'. Two properties, one renovation, $1 million in the bank. I don't believe you need hundreds of properties. I don't believe you need to be trading properties. I know someone who has a home and accesses equity who buys a property…has an equity growth that allows him to do a renovation in year three and equity growth to be able to buy a second property in year five, can set and forget their portfolio, and within 15 years, sell it down – if you have the typical growth characteristics of an area, sell it down, pay off your mortgage, pay your capital gains tax and put $1 million in the bank. For me, it was about having that simplicity.  We haven’t bought a property for many years and the portfolio goes up quite – in well-located properties it goes up quite considerably every year. I think it's worth around about $8 million now with low LVR, just based on the equities.

And, how many properties are there in that portfolio?

Seven.  They all started around about $400,000 to $500,000.

By mastering the buy and hold strategy Slack-Smith has been able to enjoy the freedom and lifestyle that a property portfolio investment offers. I asked her if she would use equity rather than cash-flow from her portfolio to sustain her lifestyle and she shares her views about this.

Well, that was really big in 2003. I know I spoke to quite a few people about doing that, and there is difficulty in living on borrowed money, and I know enough people have been on your podcast who even buy their cars with, you know.

I couldn't tell you who, but yeah.

You and I have both interviewed them. But, I don't think debt is bad by any stretch of the imagination. I think there's good debt and bad debt, and I know the reality is that a lot of people do live with some bad debt until they get to a position of managing their money better and understanding their goals, and having that destination they can be anchored to so that they can achieve what they want every day, knowing what they're getting towards. But, I've got clients – I mean, I obviously don't imply my strategies on all of my mortgage clients or my students. I've got clients that do developments; I've got students that are doing granny flats; I've got people who do pull out equity and live off equity.

I've got clients on $40,000 with $2 million portfolios and they've just been strategic about how they've bought and been very clever when the lending environment was a bit easier. I think it's really horses for courses and when you work out what your strategies and your risk profile are, and coming from the basis of your goals and understanding how many properties and what they need to look like to get to your goal, and that's why I developed that calculator on - the portfolio planner, because I know how hard it is for people to go, I want a $100,000 income in ten years-time. How many properties does that mean I need now, because there’s a capital gains tax implication and all of those things. I think you just need to simply understand what you need to be shooting for and then what the property characteristics need to do to achieve that for you. So yeah, I think everyone has a different way to get there. We haven’t bought a property in many years because we don't need to, don't want to. Property portfolio is fine. If I speak to my property managers once every three months, I'm happy.

Slack-Smith believes there is much to be gained from helping others achieve the success that she herself has accomplished.

I know that we’ve achieved over $100 million dollars worth of lending in the last couple of years and I helped clients get there. So, there's that kind of I guess, transferred satisfaction of getting people into the properties that they want to be in, and we're kind of hands-on so we're interested in the properties they're buying and where they're buying, and having that conversation around their strategy as well. And also, just the community of the students in The Ultimate Go-To Renovation: Your Property Success club, just seeing their renovations and their stories and what they're doing. Although I did a renovation – two renovations last year on existing properties, I'm not actively out there renovating all the time. But, it's nice to have a hand in looking at what other people are doing.

When it comes to her personal values, Slack-Smith is unflinching in describing how her determination has contributed to her successful portfolio.

I’m really tenacious. I'm curious and tenacious, so I don't give up and I'm very disciplined. So, if I have a goal or something that I want to achieve, regardless if it's in my personal life or professional aspirations etc., I will do what it takes to – without hurting anyone or myself, to achieve that goal. Once I put my mind to something, I really give it my all and I guess, being tenacious is probably the dominant characteristic of that.

With so many amazing resources now available for those seeking help in property investment, what does Jane Slack-Smith, Queen of Your Property Success, think is the best book to read?

Look, I have a long list of books I recommend. Obviously, Jan Somers, I think, is probably the queen of property investing in Australia. Low risk, really simple; she got the formula, she cracked it and she shared it. She was a schoolteacher; she writes like a schoolteacher and it's very clear and concise. So, for people starting out I think Jan Somers is fabulous. I think from an inspirational point of view, 'Rich Dad, Poor Dad' is great as well. There are so many writers and there are so many books out there that it’s amazing. When the publishers approach me and ask me to write a book, I was honestly – at that stage, I had 120 on my bookshelf and I was like, there's nothing I can say that people want to know that's different, and they're like, yeah they probably just want to hear it in your voice.

Often, what you read is very similar in some of the books but there's always one absolute gem that I pick out. I'm always reading property books and trying to increase my knowledge. And, our community is always recommending books to each-other as well. But, I'd start with the fundamentals, and I think Rich Dad, Poor Dad and Jan Somers is probably a really good place to start.”

Thanks to the great advice of Slack-Smith, I’m sure many of you have learnt a great deal about investment strategies. Do you have any more questions for Jane Slack-Smith? Or do you wish to learn from her online property investment courses? If so…

You can contact us on Your Property Success go in and have as look at the courses and the materials that we have available. Or, InvestorsChoice, which is the finance arm of the business where we have the education and reports, and services to support your financial decisions.

This episode was produced by Tayla Bosley with narrations and interviews conducted by Tyrone Shum.

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