Hosted By Tyrone Shum

Cosmetic Renovations For Profit and Retire On $100,000s: Make Money

Updated 23/03/2018

We’re chatting to property investor Bernadette Janson, who has discovered the beauty of renovating and is now educating others via her company, The School of Renovating. Follow her journey and find out how she created $100,000s in renovations for profit to pave the way for her impending retirement.

Uncover Janson’s path from nursing to mother to the investor; how she became infatuated with renovating as an impressionable 13-year-old; the profitable (and less profitable) projects she has done over the years; and how the method of buy, renovate and sell has provided $120,000 to at-risk children in Thailand.

"The first one we did together was our family home which was in Adelaide and it was what's called a sandstone bungalow. We looked at 180 properties before we actually purchased it. "
-Bernadette Janson

Janson is the founder and CEO of The School of Renovating and she says she is a late bloomer to the property investing game.

I really only got serious about what I was doing after I'd turned 50 and I'll tell you a bit more about how that came about. Of course I would say I had the same problem that a lot of my generation are faced with, so we were at a point where we realised that we didn't have enough to retire on and so I decided to get really serious about that. As a result, from that point on I have been using renovating as a tool to really fast track building wealth through property. In the past when I was fiddling around with property, I did a lot of buy, renovate and sell and I figured that that really wasn't going to get me where I wanted to go because in a lot of ways I was giving away the golden goose. And so the first thing I did was actually buy a property in the area we were planning to downsize into and renovate to hold - so on that property I did a really basic renovation, but it delivered $200,000 per year in equity with every year we’ve owned it.

Then, things started to move for Janson and a lot of people around her who were quite interested in what she was doing faced the same problem and asked her for help.

So that's when I started sharing my journey and the skills that I had developed and so The School of Renovating was born. I guess for me, money is not a sufficient motivator to keep me at something; I'm a people person, I really need to interact with people, I really love not just making money for myself but helping others do it too. So that's part of the drive of The School of Renovating.

So what does Janson do in any given day?

I currently have three projects at various stages and so I am monitoring where they're at, that's the first thing. Then I am actually working in my business, actually with my students, so I would say probably 30% to half my day is spent actually interacting with various people that are just at different places in their journey. Then of course, I'm running a business, looking after family - an older family but still looking after family, I'm a grandmother, I have a grandchild to dote on. So pretty much my day is divided up with all those things.

You've got a very busy and hectic day especially with the grandchild! How old is your grandchild?

He's 18 months.

Wow, that is a handful already, I know what that's like.

Yeah, he's very gorgeous too, so it’s awesome.

That's lovely. I wonder what it's like to be a grandmother now, after having your own children - how many children do you have?

I have four and to be honest with you, nobody can prepare you for the joy of being a grandparent. It's a really special relationship.

Janson's Childhood

Growing up in southeastern Australia, Janson still doesn’t identify herself as a true local.

So I was born in Gippsland in Victoria and I grew up in central Victoria in a place called Rochester, which has a population of 2,700 people.

Wow, a very close-knit community by the sounds of it. You probably know everyone there!

Funnily enough, I don't, because I went to boarding school and then I went off to train as a nurse. So my brothers used to joke by telling everyone that I was adopted when I came home, so I'm not really yet a local.

After completing her secondary education at boarding school, she trained as a nurse at St Vincent’s hospital in Melbourne, a profession she remained in for around ten years.

I actually retired when I had my first child and she’s now 30, so 30 years ago. I really loved it, but I was married to Stephen who been quite senior in the construction industry. We didn't see a lot of him, so one of us had to be at home to be the parent, so I was the person. So that’s how it happened.

And raising four children now after that 30 years, that's amazing. Did you just go straight into nursing and stay there for a decade, or did you actually go into other types of jobs to gain other experiences?

No, I went straight into nursing. I had lots of hobbies on the side, like I was always quite creative, so I did a Certificate of Fashion, I learned how to led light; I started my renovating career quite young, so I always had other interests but nursing was definitely my profession for that period of time.

Renovating, in particular, was a hobby that stuck with Janson from a young age.

I did my first reno when I was 13 years old. I'm stretching the truth a bit, it was painting and decorating, but for a 13 year old it wasn't too bad. That's when I got absolutely hooked on renovations for profit. I really got the sense that renovating doesn't just make your surroundings look good, it actually makes you feel like you're in control of your life. Like I lived on a farm where there wasn't a lot of money spent on the house and I found that if I could renovate my room it really transformed the way I felt about myself. And I think that was what I found so addictive about it.

Although her interest in renovating didn’t stem from her parental influence, she credits her husband’s mutual interest in it for her continued passion.

I really did it because I was interested in the creative process more than anything else and so no, I didn't get it from my parents. My parents were farmers but they had their mind on other things, running a business. And interestingly I met Stephen, who is my husband, who also had a passion for renovations for profit and an interest in property, so he sort of fueled the fire. In our early years we did a lot of renovating and a little bit of development, subdivision, had a bit of a go at everything.

Stephen does large institutional buildings, things like hospitals and universities. So his specialty is medical, so he takes the project, he works between the government and the project - he gets the concept and has to develop that into a building.

That would definitely come in handy actually, having that kind of knowledge. Going into I guess smaller residential would probably be a little bit different, but in that kind of sense managing a project is a similar skill set, all across the board.

Absolutely. I've actually learned a huge amount from him. And you're right, in the early days we did it his way in terms of trades we used and what we did in the renovation and that actually wasn't successful. We always produced beautiful homes but they weren't profitable and from that point of view, I come across lots of people that have builders and tradesmen at a department. The other thing we did a lot of was DIY, because we thought by saving money on that, that would make our project more profitable - but in reality it didn't. You've got to get out of that mindset of it just being about the building and you need to think more strategically.

The Beginning Of Janson's Property Journey

The first property Janson and her husband purchased together took a colossal amount of research before settling on one.

So the first property that we did together - each of us had done between pieces beforehand - but the first one we did together was our family home which was in Adelaide and it was what's called a sandstone bungalow. We looked at 180 properties before we actually purchased it.

Hold on, you said 180 properties? How did you get through that many and how long did that take?

Look it was a long time ago, but it took a long time and it might have been six months, maybe even longer. And the problem was that we basically wanted to live somewhere that we couldn't afford and we eventually did buy the bungalow which was a really great buy, but it was of course very original so we needed to extend it. The other thing that I sort of struggled with is I didn't actually cope with stress that well in those days so I was absolutely horrified at the thought of being fraught with debt, which at the time I think was $47,000. So the first thing was we had to pay it off.

The Jansons paid off their debt in around three years due to the commitment and frugal living, which was a juggling act when having to consider children as well. Despite this, Janson managed to reach her 50s and was shocked to find she didn’t have enough funds to retire on.

We just sold too many properties. When I think about some of the things we did in those days, I really could kick myself. But we were not educated, we were just feeling our way, we were just falling into it. For instance, we had to extend our original family home and at that time I think we had two other investment properties but instead of taking a loan out, we actually sold some of them to fund renovations because I didn't want to have any debt - which was a really dumb thing to do. So we did a lot of that over the period of time Stephen was busy working, so I just went ahead and did what I thought was right. We did have a family home almost paid off, but in that period of time we actually paid off prepacked family homes and we were into our third. So each time we would buy something that was worth a lot more than what we left behind.

But what happened was I actually got a bit disenchanted with property altogether and certainly with renovating. We moved to Sydney during the Olympics and we bought a house that we didn't have to renovate; so it wasn't perfect but it had enough bedrooms and enough bathrooms for our family and then I decided to go and buy a business to flip. So I thought, ‘You know what, I'm going to do something different,’ I bought a corporate café and catering business and that's where I learned the lesson that sorted me out in terms of how I was operating.

On buying her new home in Beecroft and making the decision to enter into the corporate catering business, Janson chose to extend her skill set.

So the thing was I knew that I knew nothing about running a business and so I decided to buy the catering business because I could cook, and I had the sense to go and get some education. At the time you could take like a corporate course for people running food businesses. We’re talking about $1,000 per week and it was run by industry leaders. In that training I learnt basically how to put together and run a business with systems and what was the value of the systems, I learned benchmarking for how to manage your budget using benchmarks. And the other thing that I did was I engaged one of those industry leaders to help me make the key decision about what business to buy.

So I went off from that and with his guidance actually bought a business which was in the Philipps building on Epping Road in North Ryde, which was definitely in the red and had two owners leave it - one went bankrupt, the other one just walked away in despair. So basically I stepped in and implemented those processes and within just over 12 months I had it turned around and absolutely spinning. The period of time I had it, it was returning me between just around $200,000 in wages and overhead per year - wages and profit - and in my best year I made $250,000. So I held that for around four years, but I actually have quite a short attention span so by the end of the four years I'd absolutely had enough and I had a bit of trouble convincing my husband to sell it because he was quite attached to this little gold mine.

Well, of course, I’d be saying the same thing too.

But I decided I'd had enough. So I sold the business and then I looked at what I was doing and that was the point where I thought, ‘You know what, I think we need to do something about our retirement because it's not that far off the horizon.’ Then I'm thinking what am I going to do because I was sort of used to a high income and I wasn't ready to retire. So I decided to go back to renovations for profit but to do it differently; I needed to be really focused on making profits so I actually went off and did a program on business systems and spent about $20,000 on that and I spent probably around six months working out the process moving forward.

The main thing is we gave up DIY, so that was probably the big thing that was holding us back. From there on, I did three projects one after the other and the first one was to buy the property in an area where we would downsize to as an investment property. When I found it it was $1.5 million I think - I didn't have $1.5 million, but we did have a line of credit on our house which we used to fund projects. So I went back to that, pulled the deposit out, went off and bought the place and then did a reno - just a sort of cosmetic reno - to get it cash flow positive. As a result of that, I ended up paying $1.3 million for it and by the time I finished the reno and got it back on the rental market, it was returning $1,780 a week so I was returning about 7% in the heart of Sydney. That was the first one that went really well.

Then I decided to give our own place a reno to maximize our return on the family home before we downsized. So we did that and we added an extra $200,000 onto that and that gave us another couple of $100,000s to take on the downsizing journey. And then I just proceeded to do quite a few flips.

Starting A New Project

After selling her home in Beecroft and purchasing the property for $1.3 million in Redfern to rent out, she added a new project on top of that. Now she’s undertaking joint ventures with her children to help them get into the market.

So basically the first thing I wanted to do was make sure that we had our retirement sorted out. The place in Redfern, it's four levels - the ground floor is a studio which when I rent out it brings in about $600-$700 a week and when I put it on Airbnb it’s about $1,000 a week. I figured that's a fair portion of our retirement income sorted out, over and above our super. Then I went and bought another site out in the west of Sydney to develop. So with both of those projects, that's pretty well sorted out our retirement. I haven't done the development yet, but when it's done with, that will be done. I don't need to worry about that anymore. And now we're doing projects with our kids just to help them get into the property market.

Looking back, one of Janson’s worst investing moments happened as a result of a lack of research and education on property.

I used to just find properties and think, ‘Well, I could do something with this.’ So I was out walking when the kids were little and found this house just down the road, just put up for sale, thought it had good development potential; so I bought it, bulldozed the house, built a pair of townhouses. Now this was in Adelaide and the first thing was I didn’t do enough research - actually to be really straight, I didn't do any research because in those days I just did things. We did an amazing job because as Stephen was used to doing commercial buildings, we obviously sometimes disagreed on the level to which we should renovate. So we did top-notch renovating that nobody would pay for. We built these absolutely fantastic townhouses, but in the meantime the market had a slump and we were always intending to sell them.

When we came to sell them, we couldn't sell them for the price we had done our feasibility on and so we were hanging onto them - and like at that time we had four children under five and we were thinking that we had to sell them, so in the end we did. We didn't actually lose money, but we actually didn't make any profit on it. The reason we did is because we didn't understand financing. There was absolutely no reason why we couldn't have just refinanced, then rented them out and held onto them.

So what was the biggest lesson she learned from this experience?

The biggest lesson is don't sell. I think that's the biggest lesson, though when I look at it now, the people I work with, I find people coming through thinking the same way that I was thinking back then - thinking, ‘We’ll sell this.’ There is always a way to get around it. Unless it's in an area that's not going to work or it's going to be a major maintenance issue - that's why we didn't keep our family home in Beecroft because the maintenance on it was crippling. But I would say, particularly when you're doing something speculative like a development or renovation, if things don't go to plan don't fire sale it.

When considering some of the incredible opportunities that have come her way, Janson has had several a-ha moments which demonstrated to her the power of buy and hold and the influence of marketing.

I've been lucky, I've been fortunate that I've been quite gifted with the ability to pick a good buy. I think in terms of a-ha moments, definitely I think that purchasing that - it was actually a converted warehouse - just being committed to not selling it and seeing what a financial cash cow could become, that was a huge a-ha moment. We teach how to buy, renovate and sell, because some people want to be able to do that and I've done a lot of it. But if I had sold that when I'd finished it, I would have made about $150,000 in profit. However by hanging onto it, the capital growth has amounted to probably over $1 million in a very short amount of time, so that's one.

Another really amazing thing that we had happened last year, we actually support an organisation in Thailand that looks after at-risk children and we were taking some of our students and staff on a charity bike ride, and we needed to do some fundraising. So instead of everyone doing sausage sizzles or whatever, there were ten of us and we had to make $5,000, we decided to buy an apartment to renovate and sell for profit for the charity. We had a lot of donations and great people giving things to the project, but one of the things that really made it stand out was that my real estate agent actually not only donated their commission, but they also donated their PR person. And as a result of that, it made an extraordinary profit - we got so much coverage like it was a $500,000 property and it made $120,000 profit, whereas normally I would’ve expected it to make about $70,000. It really brought home the value of marketing. When people say to me, ‘Why do you use agents? Why don’t you sell it yourself?’ And I always say, ‘One thing you have to do is make sure that the property is marketed really, really well but it's not my skill.’ And that was a really good example of what the extraordinary marketing can do.

Retire In Style and How To Build Wealth Using Your Family Home

What was holding Janson back from initially investing into property?

The main thing that I had to get over was getting comfortable with debt. Because when you're building your wealth through property, you have to get comfortable with it - I don't ever really take it lightly but I certainly see it as a tool now and not as something to fear. And I think that's an important adjustment to make, particularly with a lot of people in my generation, and you do need to really manage that if you want to build wealth and you want to do it in a fairly timely way.

When conditioning her mindset and getting help throughout her journey, she enlisted the aid of a coach.

I actually have a personal coach, a performance coach who's probably been the main support in that process. Working on limiting beliefs and my thinking around money, because most of us take our mindset around money from our families. I was in a family where my father was mentally not that well and was very concerned, had what I call “the Depression mentality.” So I formed views around money that weren’t helpful or productive; by working on breaking down those those beliefs and creating new ones that were more empowering, I was able to transform that form of thinking.

In terms of resources, her favourite property-related book is a classic written by Napoleon Hill, which she recommends to listeners as a powerful source of information that is still relevant now.

My favourite book is Napoleon Hill, Think And Grow Rich. It's a bit of a cliche but I think, given that it was written in I think 1937, it holds some incredibly powerful concepts. That's probably the one that I've found has been most impactful on what I've been trying to achieve.

I think it’s around like he talks about having that burning desire. So I think around being really present to what it is you want in your life. And for me, my burning desire hasn’t actually always been about me - obviously I want things for myself - but it's really around the people that I'm close to that I want to know. You know, things like our children. Not that I want to give them everything but yeah, it's about being able to give them the sort of life that they want. And in particular, over recent years my mum has been diagnosed with Alzheimer's so being able to keep her, to pay for care and to keep her in her own home for as long as possible has been a really burning sort of motivation for my success.

And the best advice she has ever received?

Don’t sell. I think that's probably the best advice.

On finding out that she didn’t have enough to comfortably retire on, Janson developed a strategy that would allow her to accumulate the wealth she needed to feel secure.

So basically, I decided that we would not rely on super for retirement, that we would generate our retirement income independently of super - so that was sort of the crane and I looked at what we would need to live on; we don't have a mortgage but if we didn't have the cost that we have with children and whatever, I figured out that we probably need around about $100,000 a year. So I looked at what we would need in property to be able to generate $100,000 a year, because I thought if do it in property then rent remains abreast of CPI. That's just how I worked it out. So buying enough property to be able to generate at least $100,000 per year - that's the first thing I did. Did that, got that sorted out.

For the development, I'm actually at the moment looking at affordable accommodation, which I'm finding quite interesting. I'm thinking that I'm probably going to implement that on that particular site because it's incredibly cash flow positive and it also meets the need in the community. So that's what I did. So I got that sorted out first and then started playing.

To achieve her goal of hitting $100,000 a year, she started out by purchasing her property in Redfern, which is now an unencumbered property.

Because we purchased that to downsize into, it is unencumbered and it has the capacity because it's dual occupancy - it has the capacity to produce, if we rented on the long term market, it produces around about $600-$700 a week and if we rent it on the short term market, it’s about $1,000 a week.

In addition to this property, Janson has a development project on the cards which will generate even more passive income to stabilise her portfolio.

On the tickets I’ve got at the moment, I've had it for quite awhile but that will be probably around about $100,000 cash flow positive.

This demonstrates that although many property investors believe they need 10, 20 or 50 properties to create real wealth, you can hold two great properties in your portfolio and do well.

It depends on the property you buy, of course. But basically, the other thing that I think is really valuable is most people have a lot of money stitched up in their family home, as do we. However if you can find some means of having an income off your family home, as well as it being your family home, then I think that's sort of a justification for having so much money in your family home. When I went to look for something, I looked for something that would have that potential, whether or not we use it or not is another thing. But it's got that potential, that if we need that in order to support our lifestyle, we’ve got it.

To develop her current simplistic strategy for success, Janson’s methods have come a long way from flipping properties and making a profit. But for those who are interested in renovation, what has been her strategy to ensure that they produce a great profit?

One of the things that I didn't do in the early days that I now do is that I don't buy property unless it stacks up to renovate it and pays for trade, so that's the first thing. I’ve got a feasibility process that I go through to make sure that there's enough money in the deal to be able to pay traders through the project and make a profit.

When you're thinking like a builder, you don't think about those things and when you're doing DIY, you don't factor in the work you do yourself. So in reality, that makes them unprofitable. So I have to be much more strategic about the property I buy so that it does have that profit potential. Sometimes that means going up into higher price brackets, like I experimented and bought a tiny little studio in Surry Hills which is only 28 square metres just to see how small I could go and still make a profit - and I did, I made $22,000 off a three week rent that I really felt it was way too much work. But now I look at around about $900,000 - we work on roughly 10%, so we buy a property worth $900,000, we were looking at around $90-$100,000 profit, I think that it's worth the effort to do that.

This draws similarities to development, where generally the bigger the numbers, the greater the profits.

I actually think around a million, particularly in Sydney, is a sweet spot. We are finding some deals in Queensland that are in a lower price point with a better profit margin, but when you're talking about Sydney and Melbourne, I think around the million mark. Of course not every property will be $1 million, you have to research the area to make sure you find the gap in the market you're going to need. And for us at the moment, it's professional couples, gay couples and downsizes. So you've got to make sure that you're filling a gap in the market.

In targeting this type of market, Janson looks for potential in properties such as a big living area and a more inviting aspect with entertainment areas.

A lot of it’s about the type of property you buy. So if I'm renovating for a down cycle market, I want to have decent-sized living areas, because downsizes have big furniture, some of which they can't part with. The first thing is is the living area going to be big enough? It even comes down to styling - if your stylist filled the room with furniture and makes the living room small, it's going to create a lot of objection in the market. So really creating a decent living area. In terms of laundry, you can get away with a European laundry yet if you're renovating for a family particularly in a suburban area, a European laundry may not cut it. You can sometimes get away with not having a bath but go for more of a luxurious type bathroom, double showers and double basins if possible. Having outdoor entertainment areas, so really playing that up so it's really inviting. Bells and whistles - things like putting a wine fridge, an island bench, having an entertainer’s quick kitchen and maybe putting an island bench in the kitchen so people can sort of entertain around that, that sort of thing.

When undertaking renovations, she believes who you work with is really important.

If I can outsource something, I will, like I tend not to try and do everything myself. It's to the point where now I even use buyers agents, whereas once upon a time I would never have done that. In terms of finance, if you're renovating to sell it really doesn't work with the mortgage broker structure, which is a shame because I think of good mortgage brokers as like gold. In terms of your team in the renovation, obviously having a team of trades that you can work with over and over again makes it easier, there's no doubt about that.

But you can put a team together quite quickly; I think people get quite daunted about the idea of not having this trade team, not having that really established trade team, but I have actually put together a team in a week. It's possible, you’ve just got to follow a process and particularly in terms of due diligence for the trade. But of course we do have trades we use over and over again and that makes it very easy, because they're used to working together, they anticipate your needs because they know the type of renovation we do, that sort of thing.

So how does she determine who the best people are when establishing a solid, trustworthy team?

We have a really specific due diligence process in terms of reference checks, we do license checks, insurance, certificates of currency, but I always make sure that I do reference checks actually on the trades work and the people that they work with. One of the ways you can get good trades is if you notice trades that are working in the area, I take note of what they use to get their contact details, you can actually then go and get an unsolicited reference from the person they working for - you're not relying on the people they tell you to go to.

I would ask things like how reliable are they? Do they turn up on time? I'd want to look at their work, particularly tilers, painters, to check the renderers, to check the quality of their work. I'd be asking how hot they are on variations? Like do they give and take, or the minute you need to get a variation, those sort of things.

As well as working with individual trades, Janson also works with a builder where necessary.

A lot of the smaller projects that we do, we don't really need a builder to manage the project. We'll need a builder for some elements of it. Like if we need to get a construction certificate or council approval, we'll need to have a builder to do that. But we tend to work with trades as well. So we'll have a builder to do the stuff that the builder has to do and then we'll have a finishing trade we'll manage ourselves - that's a cost saving measure.

Now at The School of Renovation, Janson is working on a few entrepreneurial strategies that allow all types of investors to take on projects - from the time poor to even children!

One of the things that we've been doing a lot of work on recently in joint ventures. What we find is that when people come to us, they will either be someone that's quite asset rich but doesn't have the ability to get a loan - so they may have a line of credit and have some money they can access to actually do a project. Or we will have someone that's working full time and can get a loan, but are quite time poor. So one of the things that we've found really beneficial is actually pairing them up and to actually do a project together; so that often the time poor person that's working full time can do some of the off side administration and whatever to contribute to the project, and then the person that’s asset rich but has plenty of time is able to run the project. And we’re finding that that is a really powerful strategy because it doesn't matter what you do, you need to have a deposit to get started on something. And if someone doesn't have a deposit, then that's a good way of getting to work, and getting a deposit to go off and then buy a property.

Talking about doing projects with children - we call it the “avocado smash strategy” - and that's really basically what we're doing with them. They have serviceability because they have a dog, we put in the cash from a line of credit, do the project together and walk away rather than us taking money out of our pocket to give to them to go and buy a house, that we're actually doing it together. So it teaches them entrepreneurial skills and it’s just good fun.

She admits that the risk of pairing up joint venture partners who don’t work well together is a possibility. To avoid this situation, the process is monitored from the inception of the partnership.

I've come across lots of people who have been in a horrible joint venture situation. And I think that's a result of when we help people to put together a joint venture, we actually do it in our entry program so I'm able to monitor that process and make sure that it is being done in a way that manages the risk responsibly, so that they have the best opportunity for a good outcome.

A personal habit which has affected Janson’s day-to-day life and helped her achieve wealth and success has been persistence.

The personal habit that I think has been the most powerful has been just being relentless. Like in terms of defining properties and securing them, I think being prepared to go further than others have been.

For the next five years, she is now focusing on how she can help others achieve amazing results through property investing.

I'm really excited about the number of results I can produce for the people I work with. I've already got what I want - I’m really excited about what's happening in our community. So we've got lots of exciting projects, I've got a student in Victoria at the moment currently buying a yoga retreat, so it's combining her property journey with her business journey. I've got three sisters that had joint ventures together, they’ve sold their business and this is their new life. Yeah, I've just got lots of exciting things happening.

For those who would like to become involved with the program at The School of Renovating or just to connect with Janson, you can do so via Facebook or her website.

The best way to connect with us is to either come over to our Facebook page which is The School of Renovating or come to our website which is

This episode was produced by Alex Cooper with narrations and interviews conducted by Tyrone Shum.

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