Subdividing: Increase the Value of Property with Darren Standish
As the first person in his family to enter university, Darren Standish always had a passion for learning. Having gained interest in the value of property, Standish was quick to buy his first property, going “over the top” and subdividing the land into 10 separate units, just before the GFC.
In this podcast, discover how Standish was able to overcome the devastation of the GFC, his strategy to minimising mistakes when taking on development projects, and how he used his experiences to build the foundations of his advisory business; Property Prosperity.
As the founder of Property Prosperity, Standish has his hands full with clients on a day-to-day basis and answering enquiries to solving their problems with property investment.
Basically I just chat with people and find out what the situation is. There’s a lot of people who are interested in property.
There’s always something that they’re not sure about. They want to invest in property or they’ve got a property or they want to buy a property or they want to sell a property so I just basically chat to people what their situation is and offer them solutions. The good thing is because I can do so many different things I don’t really have to push them into one direction. And so I can really have a chat to them give them some advice and there’s probably something I can do to help them out and if I can’t I can at least point the right direction and maybe I can help me out in the future so it gives me a lot of flexibility I suppose and if I’m just a builder and people ask me whether they should do a house, the answer is probably going to be yes because I can do so many different things. It sort of makes me independent and unbiased which is a good way to be and just make sure I’m getting the best outcome for the client.
Despite his decade long involvement in property investment and the position he has in his company, Standish is still not sure what exactly to label himself.
To be honest with you I have no idea what my job title would be. I don’t really know what I do I just think of myself as a property guy I suppose and probably a property developer. The thing about being a property developer there’s just lots of everything matters when you’re property developer. So obviously finding the right project or analyzing the project or managing the subdivision organising your finance or organising the build or selling the property so pretty much if you have one weak link in any one of those chains it’d be the difference in being profitable and being unprofitable. So I spent a long time trying to build up my skills in all of those sorts of areas so that I can really understand how it all works just to make sure I don’t get caught out and get myself into trouble. So yeah just a property guy really.
Growing up in South Australia, Standish had no idea what occupational field he wanted to pursue, opting to “go with the flow” and discover his interests impulsively.
I just went to a local primary school and the local high school so just to just walk down in my street went to school in the morning and walked back home again didn’t really have any you know all the way through. I’ve just been interested in and learning things and I’ve just sort of been interested in business but I haven’t really exactly know what I wanted to be.
I remember in high school I just wanted to be a businessman and I didn’t even know what that was but I wanted to have something where I went out and worked in business. I suppose because my dad had his own business and he sold push bikes and so I used to see him go to work and sell push bikes and come home each day and I thought that seems like a pretty good life but I didn’t really have any idea how you ended up doing that and obviously the educational systems are geared towards studying particular knowing what you want to do and studying all these courses they become a doctor or a firefighter or a policeman or something. I mean that didn’t really appeal to me but I just wanted to do something and I just I didn’t really know what it was I just went on a journey of just trying to learn lots of different things and then at some point in time my theory was I’d be able to apply it to something. So I’ve unfortunately or fortunately depended on your viewpoint I’m still on that journey I’m always learning new things and I’m always trying to work out my place in the world and what is my thing so yeah obviously I’ve chosen the vehicle of property as my day job I suppose.
But yeah I don’t necessarily look at that’s the only thing I can do in life or lots of different things and I just look at that as just a vehicle to continue moving forward and trying to achieve certain goals.
From a young age, Standish loved to learn and despite his parent’s opposition, he became the first in his family to attend university and pursue a career outside of the trading industry.
My parents are pretty average sort of people. I just went to work each day and came home each day. I was probably a bit unusual in the sense of my desire to continue learning. That was probably exceptional. My family in the sense that no one in my family ever you know, my brother and sister both left and they’re about 16 and then just went and got a trade and started working straight away whereas for some reason I just kept going to school and just kept studying and studying and studying and my parents were like “Why do you keep doing this, studying, what is the point of all this?” and I’m like “ I don’t know I just like learning stuff” so I’ve just continued that and I’m just massively over-educated for some reason I just couldn’t stop learning things.
And so even formally I’ve learnt lots of stuff but even outside of formal education on this in the podcast and reading books and DVD and going to seminars and webinars and a whole Politiken stuff and sometimes for no reason at all just because I like learning things and experiencing things in different ways so not really had a purpose.
I’d got through to the end of Year 12 and passed my subjects which were a miracle and then I decided I have no idea what I want to do so I go to uni and I thought “Oh I’d go to uni that’d give me excuses not to get a job”.
During his university days, Standish worked a variety of part-time jobs, including bartending before looking to a stockbroking firm and discovering his passion for economics.
I got a job in the casino working the bar, working from six at night to six in the morning and realized that that’s not good. I don’t want to do that. Did that for like 6 months and it almost killed me.
I worked in different places as work experience and I thought maybe I can do stockbroking so I went to a stockbroking firm to do work experience and said “Oh, this is a pretty cool stockbroking thing. What do I have to do to be a stockbroker?” And they said “Oh you got to do economics at university” and I’m like “oh that sounds pretty cool, okay I’ll do that” so I enrolled to do an economics course at university.
So then I got an economics degree and an accounting degree and then I was sort of working at the same time so I was sort of working full time and studying full time and then. Yeah. Then I thought well I’ve got this accounting degree. I might as well keep going. So I did CPA like an accounting post qualification thing and so yeah. So then I became a CPA. The reason I did that was that if you go and work in an office and you’ve got a degree in accounting it doesn’t really count for a lot but when you get your CPA which is a qualified accountant then your wage basically doubles overnight for no reason just because you got that piece of paper.
After some time working and travelling around Europe, Standish came back to Australia keen to spend his money by investing. Standish was initially drawn to the share market before realising that the property investment industry had larger, long-term rewards.
I understood how businesses worked and so it all seemed to make sense to me and I spent a bit of time working out how that worked and I was quite successful in investing in shares. The reason when I came back to Australia I decided not to get into shares was because you couldn’t borrow money to buy shares or you could but you can buy a relatively little amount of money.
And so the problem with that if you’ve got ten thousand dollars and you put it into shares and it doubles you know you just made 10 grand which isn’t a huge amount. It’s great. At the end of the day but it’s not a huge amount. You can’t really retire off that. Whereas for property you can get 10 grand or 20 grand put that into property and buy three thousand dollar property and again you know if that doubled in value you know you make 300 grand you’ve only put 10 or 20 thousand dollars into the whole deal so you can see returns a lot greater even if only goes up by 10 percent. You put 30 grand in by three thousand all property goes up by 10 percent which is not a relatively huge amount of money but you suddenly doubled your money. You’ve invested into the property.
The leverage is just so powerful and so because of my limited capital and because I wasn’t confident enough in investing in shares to leverage into shares. Then I could only see I could only invest a relatively small amount of money. So then I decided you know property was going to be my thing because I had a bit of money and I’m happy to borrow some money to get the property and I thought “oh, go out and buy the property and get started”. So yeah that’s when I came back here and bought my first property and decided to give it a go.
He bought his first investment property just before the GFC in 2007. Despite knowing that the property market would crash, Standish decided to take his chances and lucked out on a huge piece of land which he subdivided into 10 units.
So I sat around there waiting for the market to crash and then I’m like “man how long am I going to sit around waiting for this to happen” so I’m like stuff it, I’m going to go out and buy property and I’d done a bit of research on trying to create value in properties well and property development side of things. And so yeah so I thought I’d buy a property with potential to develop. I went a bit over the top though, I bought a property that had subdivision approval from separating from one to 10. So it was a bit over the top. It had a house on the front and a big block at the back. The weird thing was though I’d actually looked and the person was selling it to me actually who actually owned the property was a real estate agent and so that obviously you make the assumption everyone’s a lot smarter than you are.
I just couldn’t see how I can make a mistake in this thing I could see what price it was, I could see what I could sell it for and I could sort of rashly try and work out where the numbers are and I’m like man, this is a really good opportunity, I can’t see why I can’t buy this thing and make some money out of it and it just seemed too good to be true and so I just took it apart and bought it and gave it a go. In hindsight it was a pretty big deal, it was a fair bit of money as putting all my money and all my eggs in one basket. Taking a huge risk. Fortunately for me, it paid off and so it was a profitable deal and I did make some money but there was some massive headaches and in hindsight looking back, I had no idea what I was doing it just purely luck. Managed to get out of there unfazed but fortunately, I got the way through and it was a really good experience I learned from that and then from there on I realised I shouldn’t take massive risks like that and so I went into more small scales from there on just doing smaller one into two subdivisions.
Despite the risks, Standish was able to make a profit and gain valuable experience in property development with his first property. Banks pre-GFC also aided his investment by lending money based on the property’s subdivided value.
The thing I didn’t realise at the time, sort of trying to realise as I was going as you know, I’m going to have to build a road down the side and I got services and also civil works and all those sorts of complicated things. You know there’s massive X-Factor. You really have no idea what those things are until you get the experience. But even when you’ve got experience there is a degree of X factor associated with some of those things that you can’t know until you’ve put all the money in and research that you know exactly what it’s going to cost you. So there was a big risk associated with that. So from then on it was, didn’t want that sort of stress in my life anymore. So then I went more small scale. Unfortunately for me this was pre-GFC and say the cool thing once you sort of understand how the finance system worked then basically banks liked developers back in the old days. And if you could show value they would just give you money.
And so basically what you could do then is you could actually, you’d have the approval to go refinance the property you could sell those two blocks of land off to the next person. They wouldn’t be able to settle for another nine months because the subdivision hadn’t gone through, the house is still sitting on the block you know but you just explain to the people that had a bit of time to wait.
Through his first investment property, Standish was able to learn more about property development and thus, advises fellow investors to take on development opportunities.
Fortunately for me, that period of time allowed me to do lots of developments and learn lots of things. Basically you know I talk to a lot of people interested in getting developments into developing and one of the things I say is the best way to become property developers is to do lots of developments. The danger with that is obviously you know if you make a mistake you lose all your money and it can be really expensive. So obviously you have got this fine line, trying to learn as much as it can and you’re limited by your finances so you may be able to do only one development a year or two years or whatever it happens to be. And so you’ve had a learning experience on that one development but then the next development is going to be totally different. You’re going to have a whole pile of new different learning experiences and so hopefully those experiences aren’t too painful and cost you lots of money and hopefully you can apply that knowledge to the next one and that’s the good thing about property development it becomes less risky, the more experience you become the less risky it is.
However, Standish warns developers against being overly ambitious and taking on too many projects with high risk.
The problem I see is a lot of developers though once they build up that skill they then want to get bigger and bigger and bigger. And so that’s why I find a lot of developers go broke. It’s because they keep upping the ante and so they can do it one into two. And I think that’s really good and they find it really easy and they’ve made 50 grand or 100 grand and then they’ll do one into three and then something like 200 grant and then a day one to five and then they do on it at 20 and one the 200 and then it suddenly all collapses as the skill set you’re required to do a one in five is it different than the one to two. Likewise one into 20 is different to a one to five or one ends at 200 or so. So that’s the problem. It’s a totally different world and it’s totally different skills required and an experience required to get to that sort of stage. And so that’s sometimes really experienced developers can collapse because they keep pushing the boundaries of where they can get to and unfortunately you never know the limit of your experience until you find out you made a mistake and then sometimes too late particularly as the deal gets bigger and bigger and you’re putting all your money in the next bigger deal.
Standish believes that success will always come from practical experimentation and that trial-and-error will always deliver results for property developers.
Unfortunately some of this property development thing, you can only learn by yourself. And even you can read all the books and go to seminars and webinars and this sort of stuff at the end of the day you can only learn by trial and error and sometimes you’ve got to go out and give it a go and make mistakes. I’ve definitely made mistakes. I look back and think I knew I shouldn’t have done that but I still make that mistake anyway. You’re gonna have to learn it the hard way.
While Standish did not fall victim to the GFC as seriously as other investors and developers, he acknowledges his mistake of impulsively investing.
Basically the example I mentioned to you before about the investing pre-GFC. So after the GFC happened the whole of property developers all went broke because there was a strategy in that particular point in time was all based on value. So you could buy property, create extra value, the bank would let you refinance and then pull the money back out and you’d be able to buy the next property and so like you said you could buy multiple properties without actually settling on it because you just keep getting approvals done and then you’ve sold it off in the meantime you’ve settled it and you’re basically settling on the property you’re buying and selling off the properties you’re selling relatively similar amount of time so you can see how this strategy works quite well. Then the GFC happened and then banks and property developers and they didn’t value anymore they valued cash flow and how are you going to be able to pay for this thing?
You didn’t have the income you only had value because you’d sold the properties off to somebody else then the rules of the game changed. And so there was a lot of developers that were caught short then is that they couldn’t settle on these properties and all you need is one property you couldn’t settle on and it just like a house of cards and you did get caught short on that one you’d have to pull money out of one to try and help you out with that one and then it all built on itself and it just created this vicious circle where one would fall down and they’d all fall down essentially. So a lot of real experience really you know they were profitable deals or a lot of developers went broke over that period of time because they just couldn’t get the finance to settle on the deals and create this big out of control spiral where they just collapsed within themselves.
Currently, Standish applies his experiences from the GFC to his present property investments and tries his best to adapt to the way the property market is now.
And so I was fortunate I managed to get through there without going bankrupt or other but a lot of people I knew lost everything and so they went from really profitable really experienced to just losing everything they had and starting from scratch again and for some people you know the pain of experiencing that is just too hard to go back to and to want to put themselves out there again and try and do it again. I just sort of put myself through the pain barrier and thinking there’s all this value, all this experience and all this knowledge I’ve got I can still apply that, I just need to change the strategy to adapt to the environment and so that’s why it’s a really important to understand finance and how finance works and we’re going through a relatively similar sort of a change in the finance market now which is not the same as back then but now it’s really focused on… they’re not particularly enthusiastic about investors at the moment and they’re trying to minimize the value of property rental income which was you know.
He’s now focused on bulletproofing his portfolio by focusing on positive and stable cash flow so that if the disaster was to strike again, he would not get caught by the market.
But you know there’s definitely a potential for the market to change. I suppose for me I’ve really been focused since then is trying to bulletproof my property portfolio and trying to really focus on creating value but also having cash flow as well. And if you get both those things aligned then you’re going to be in a really strong financial position and also I could see the frustrating thing during the GFC there were some great opportunities there and if you were caught out then you were desperate. You had to sell but if you were in a situation of really strong financial position you could take advantage of opportunities and really you know pick properties up crazy cheap prices and make some huge gains and it was relatively risk-free. And so for me, I really wanted to focus then on how can I not have this happen to me again and so. So one of the ways of doing that is making sure I had plenty of cash flow coming in to try and subsidise my mind vesting so that sort of changed my mindset a little bit in the sense of I did want to become property developer I want to do development but I wanted to make sure I had cash flow and try and fund those governments well so I wouldn’t get caught short if the market changed so…
Standish’s experience prompted him to start up his own business to help people find the most value in properties and not make the same mistakes that he did.
That’s one of the reasons why I started helping other people. Firstly because whole poly people kept asking questions all the time and I really wanted to make sure I was giving them plenty of value and sometimes people don’t really value-free advice and so I wanted to structure it in a way that they really got huge amounts of value in it can really apply and so that’s why you know started helping people along the way and then I went on this journey, good or bad, starting up a business where I was actually helping other people. Unfortunately or fortunately, everything’s new.
So for the last 15 years or so I’ve really been focused on how do I create a business that is really efficient and efficient in a sense that creates the most amount of value for my clients with the least amount of effort for me basically. I just realized in life and this is one of the things when I talk to young people they talk about “how do I get a pay rise?” or “how to earn more money?”. And I’d say create more value for your boss at the end of the day.
He believes that the best solution is to remain independent of the business cycle and invest in property by creating value outside of what the market dictates.
I think the a-ha moment is trying to make yourself independent of the property market and the market in general essentially. And so again it comes down to creating value. That’s one of the things I like about property development besides buying a property and hunting for the property go up, is the end of the day you just wait for the market.
And so that’s the thing I like about property about me creating value independent of the market and so if the market goes up as well that’s a bonus. But the benefit is if you can look at a property and you can see I can add 100000 to our thousand three thousand dollars worth of value and irrelevant of the market then puts you in a lot more powerful position.
And so it sort of acts as a bit of a safety net a bit of a buffer in case you’ve made a mistake because you’ve added all this value and market goes down, you find you are still better than the guy next door who just bought the properties when the markets go up.
While most investors recommend diversifying your risks by applying different strategies to different types of investment and development projects, Standish encourages the opposite.
It doesn’t have to be provocative only can be renovations or it could be whole lot of options or it could be lots of different ways to make money; commercial property industrial property whatever it is, you just have to get good at it because the more time you do it the more experience you get, the fewer mistakes you make and the more profitable the projects going to be and the potentially riskier projects are the ones that are more profitable but they’re risky for people who aren’t experienced but for people who are really experienced, they’re not particularly risky at all because they know what they’re doing, they’re not going to make mistakes.
You know I talked to people I said commercial properties and stuff as well and they, you know, they just do childcare centers or they just do medical centers so they just do this and that’s all they do and they know exactly what they can do with that.
So you think whatever the strategy is, you pick a strategy and get really good at it.
Cashflow Management For Property With Darren Standish
When Standish first began investing in property he was prepared to risk his money, opting to step out of his comfort zone and learn the ins-and-outs of the industry to his very best.
It’ss a lot of money for anybody really when you’re investing in property it’s a scary thing it’s something that people don’t do every day. I’ve become a bit relaxed about it now because I’m doing it all the time and obviously for me I’ve you know I’ve done hundreds of developments and I’ve been involved in thousands of property transactions so.
For me I’m like you don’t actually do anything like you basically just bought a house and moved in it wasn’t so hard and so the thing to understand is it’s a new thing for a lot of people when you’re talking about money that’s a very personal thing and a really stressful thing for people as well and obviously as you start upping the stakes and your business not house you move into. But it’s also you know you’re going to knocking things down your subdividing, they’re all new terms and new terminology and you have to talk to all these people you never talk to before starting to trust all these people you never talk to before so it can be a really scary thing and so…
But sometimes you’re going to have to put yourself out of the comfort zone you’re going to have to look at the benefits and look at why you’re doing it and why you’re trying to achieve what you’re trying to achieve out of these goals.
While most property investors may recommend beginners to build their knowledge of the industry from reading plenty of books and accessing other resources, Standish also encourages personal interactions with others to leverage from their experiences.
One of the things I’ve been talking about is building experience and building the knowledge and the more development you do the more you learn and the fewer mistakes you’re going to make. But the thing I learned going along is you don’t have to know everything, you don’t have to.
There are other people out there they’ve already got this experience and this knowledge and so you really want to leverage off their experience and so that might be the real estate agent or a mortgage broker or it could be a Real Estate Agent, a surveyor or builder or your engineer or whatever they happen to be they’ve got all this knowledge and all this experience you can leverage off and the amazing thing is they know what can go wrong and they want to help you. They want you to not experience the pain that they’ve experienced sometimes. And obviously, when I’m helping my clients I don’t want to go through the journey I’ve gone through because there were painful times and it took a lot of effort. And so I wanted to make it as easy as possible for my clients and have a good experience. And so building a team around you the value of that is not only the fact that they clearly do some of the work for you whether it’s your commands or your surveyor or your builder or whatever but also the value of that is experience and knowledge and not just their experience or knowledge but their past clients they’ve had experience and knowledge from. So you’re learning from their clients and from their other clients and you’re building this network around you and it makes, it’s sort of building like an invincibility shield, it really gives you a lot of confidence a lot of power when you’re out there investing in properties.
Standish adopted this mindset after learning the hard way that trial and error doesn’t always work out and that it is okay to learn from others personally.
Unfortunately, I learned by trial and error. I think it’s just the type of person I am. I just like to learn from the inside out. And so you know I started up a mortgage broking company not because I want to be a mortgage broker, I just want to understand how finance works and so from the outside looking in you can’t really think like a mortgage broker and so I just like the idea of just understanding how it all worked. And likewise I didn’t want to be a real estate agent but I really want to understand the best way to sell a house. And so obviously I sold all my own house and I started helping other clients sell their houses and so now I think like a real agent but I sort of techniques that to try and work out the best way to sell a house and I’ve just spent the last five years trying to work out the best way to sell a house. How can I sell the house for the most amount of money in the shortest possible time and so it took me a long time to try and work out how to do that. Likewise, the building side of things just happened I started building up you know hundreds of houses for clients just helping them not me personally I wasn’t the builder I would help them negotiate with the builders and through that process, I just wanted to understand more. So that’s why I got my builders licence so I can build houses for people why don’t I still help than just negotiate with builders. They really wanted to think like a builder and so.
So, to be honest, you I don’t think that’s the right journey to go on. I think it’s that more difficult journey and you’re trying to. I don’t think you have to know everything. I think you really just have to find people you can trust and you feel that you can really leverage off of their experience.
After decades of experience in the field, Standish’s focus has shifted from working long hours at his job to creating more value with his work so he can spend more time with his family and avoid being locked in an office every day.
To be honest I’m on a different stage of my life right now and so I remember I started out wanting to build a good property portfolio and trying to you know make a whole lot of money and that sort of stuff. My focus has changed. Now I don’t really care about any of that sort of stuff. I’m more focused on lifestyle and I’ve got some young kids a three and a five-year-old. So really my whole focus is just hanging out with my kids and that’s one of the things I really like about property or property development, in particular, it’s quite efficient for your time. Like you really don’t have to… you can make good money for not doing very much. And so like even helping my clients you know they can pay me money which is a decent amount of money for me to help them out and it doesn’t take me a lot of time but I’m creating huge amounts of value for them and so they’re willing to pay me more than they would if I was you know digging a hole for them even though it’s a lot harder work me to go out in their backyard and dig a hole. They pay me a lot more money to stay with them and just explain to them how to do the development or analyse a project for them or manage a subdivision or sell the house or whatever and so.
So it’s really about focus on creating value and so that’s what I like about probable development you can you know a project might take a year and a half but you really only do 40 hours or maybe 80 hours worth of work. You might make 100 grand or 200 grand or 300 grand so when you think about it if you’re getting paid per hour and you can work 80 hours and make 300 grand it’s pretty crazy when you break it back per hour type thing.
Standish believes that it is best for both investing beginners and long-time investors to constantly be asking questions and seeking to be more efficient in their work.
I think I’m really I’m just constantly asking people questions and I suppose that even within my life as an accountant I was constantly asking people questions of why are you doing that know and I’m sort of just trying to learn everything single thing you do you learn little things and even when I think I know the answer I still ask them why and then they sometimes they surprise you with a different response than what you expected and you know. So just constantly questioning why you’re doing something and is that the reason?
And so it’s amazing if you question why you’re doing it then a lot of the stuff you’re doing is irrelevant and you can do things a lot easier and in example, I talked about making myself paperless you know I sign all my documents electronically and so you know I’ve been like that for like five years. Saves me so much amount of time I can email someone they sign the document electronically it comes back, it’s all done up to save a huge amount of time rather than driving around getting people signatures. And yet very few real estate agents I know do that even though it’s totally legit. Everyone could do it. The real estate industry had its own system for sending out electronic documents to be signed automatically. I’ve never had a real estate agent send me an electronic document before.
So yeah. So I’m just constantly asking yourself why am I doing this? Is there a better way of doing it or an easier way of doing it because you know I’m sure there’s always something you should be doing with your time rather than you know what you’re doing right now.
When it comes to a property investment strategy, Standish already has his own creation in mind, a strategy he calls the “O” principal. He explains the three-staged strategy in detail.
One of the things when I’m talking to clients, the thing I’ve always got in my head is my own sort of system I’ve developed and I call it the “O” principal and the very first stage of this is that the O is the origin. It’s just really just trying to think about just structuring, really getting yourself ready to invest before you even start basically. So think about your structure, think about where you’re at right now financially, what you can afford to do, what your lifestyle can allow you to do. So firstly making sure you’ve got your finances in order. Educating yourself so you know exactly what your options are and what is going to apply to you and then just really planning out a direction so you actually know this is “the way I want to go, this strategy aligns me with where I want to get to”. And then you’ve got to plan before you even start. So I think that that’s a very first stage and then the second stage is just going forward, acting basically, is just really doing something. You know if you sit there building it is knowledge, analyse things and trying to learn about all these different things. If you don’t do anything you’re not going to achieve anything. So but I think it’s really important is to just focus on one thing, get really good as been mentioned before and so and then once you’ve focused on that one thing you can start to build a team around you and this really can help you support you with that strategy and so.
And then from there on you just repeat that. You just start doing it more and more and more and is building those skills and it’s got to the point where you’re reducing the risk so significantly that you know you can’t go wrong you really.
Done and tested, Standish’s “O Principal” strategy prevents investors from making repeated and unnecessary mistakes, as it builds from the personal experience of each investor.
You can’t make any mistakes because you know exactly what’s going to happen before it happens and sort of like you’re predicting the future and it becomes crazy I can see a property and I can just Google it and just know exactly what’s going to happen what’s going to go wrong. You know I’ll still go often when I analyze a project I do like a 200-page report and I’m still over the top with my analysis but usually, it’s just confirming what I already know that I’ve looked at in two minutes. The reason it’s important to go through everything is because you miss one thing that’s different is very profitable not profitable or you can’t subdivide could you miss this one, there’s an easement or a sewer or some sort of you know the stormwater or it could be some random thing you haven’t thought about it before so you have to go through everything every single time to make sure they haven’t missed anything.
The third stage of Standish’s property investment strategy is to simply accumulate the information one has gathered and apply it to a physical investment property.
it’s relatively hard for me to make mistakes. So that’s the second stage. And then finally you get to the third stage that’s where you accumulate knowledge and that means that all the information you’ve gained and you can actually start to apply that.
I think we have to really get themselves ready first find out where they are right now. Find out where they want to get to and then map out a plan and then just really focus on that till they get really good at it and then once I get really good at it they’ll know at that point in time they’re really good at it because they they find they can’t make mistakes and they find it really easy and then they can maybe look to diversify into other strategies.
By sticking to Standish’s “O Principal” strategy, investors will become more aware of investment opportunities that may have previously gone unseen.
All the good deals were there but I was like “Man I can’t believe you can’t see all these amazing opportunities that are out there” so it’s just about opening your eyes to the opportunities and sometimes you know when you’re ready when you’ve got to see it as an experience and knowledge you’ll just open your eyes one day you see all these opportunities out there but when you starting out everything’s all-new it everything’s so difficult. You think it’s impossible but if you stick with it and get really good at whatever it is you get good at it then it would just open up all these opportunities for you.
Standish is aware that a project cycle’s pace is different for every one of his clients and thus encourages investors to invest comfortably and at their own pace, and under the advice of an accommodating property investment advisor.
The crazy thing is developments are such a long cycle suppose that the project cycle and the question are where does your project cycle start? And so I’ll talk to people. I’m talking with thousands of people rally and so I just chat with people and they’ve got a project that they’re looking at doing something with and it might be three or four years before they’re ready to do something. The other thing I mentioned before is you know you’ve got to be ready to go. You’ve got to get to the end and say yeah I want to start unless you’re ready to get to the end. And so you either do it or you don’t do it and if you’re not ready then you wait to be ready.
I have a lot of people, they’re not ready yet and so when they’re when they’re ready then they’ll give me a call and say has that project started yet, we looked at it we look and see this potential I’ve identified certain things but then we just put on hold until they get their finances in order or they go sell off another property or they’re just maybe just not ready to take on that sort of punt because there’s other things happening in their life and so other projects I’ll be having, we might go through the process getting approvals through and then they sort of renovate things or they might sell things or build things or subdivide things and so there’s just a whole pile of different things changing all the time with different people so literally can be years and years and years before even people start and then a project could last for a couple of years before it’s even finished and then we’ll have to sell the property off after that.
So I’ll literally be dealing with know probably a couple of hundred people I’d be chatting to at any particular point in time where you know you could sort of say the projects are active but in reality, there’s only a handful that is really you know…
The way Standish charges his clients also reflects his increasing focus on creating value with his work rather than simply working long hours.
One of the things I realized very early on when I thought I was going to start helping out people with doing developments is I thought maybe I could charge people per hour. The problem is everyone says well, how long going to take you? And it’s like “Well, I don’t know”. And so that’s the problem you get when you charge people per hour.
The thing becomes too overwhelming form they don’t get any value out of it if I just talk at them for an hour and tell them thousands of things. And so I quickly very early on I decided that wasn’t really for me I actually pulled out of helping people for development. I just thought how am I going to charge people because it was just I didn’t think they were getting the value they could. Then I changed my mindset to maybe I could maybe give them discrete packages of information and really structure it so that they just pay me a set fee for for a set service that I do whether that analyzing a project or managing a subdivision or helping the bureau selling the property or to the finance or whatever they knew exactly how much was going to cost before it happened and so and then I could take leave whatever they wanted.
If they want to be analysed project manager submission they could do whatever they wanted or they could do it all themselves or whatever and that’s all fine so that’s sort of the way I structured it. So now people know exactly how much is going to cost that something comes out of my experience so I know how much effort is going to take me I know what I can do and I know I can deliver a lot more value than what I’m charging clients and so now I can charge a set fee for things. I know what’s going to happen before happens essentially and so yeah otherwise. The other thing I do for people to also helps people source development.
While Standish has read many books on property investment himself, he believes that first-hand experience is always best, as opposed to knowledge that may not be easy to understand and applicable to projects, especially for investing beginners.
I’ve read so many things. Okay, let me start from the start then so okay. So basically when I started out I just tried to learn everything I tried to learn as much as I possibly could. So I read heaps and heaps and heaps of books and went to seminars and webinars and networking meetings and did crazy amounts of stuff before I even started. But I just sort of found by learning stuff and not applying it, it’s not particularly valuable it’s maybe it’s good for you to try and understand what makes sense and what doesn’t make sense to you.
But even in hindsight when some of the things I read back in the past that made no sense to me or didn’t really apply to me, didn’t align with my mindset at the time. I look at it now and it looks you know it makes total sense but it’s only because I’m in a different place right now on different level experience and different levels of knowledge and so I think you’re really going to find something that really touches you and makes sense for you at that particular point in time. I think you know obviously things like which Rich Dad Poor Dad and all those types of things are great to give you understand the structure of how to try and make money.
Standish also believes that his most contributing habit to his success is his drive to learn and understand from different perspectives.
So I think my personal habit is, it’s just trying to build knowledge and understanding and so I think that’s definitely helped me in the sense that I can see things from different angles. Even just you know you might have dealt with one side before but you’re dealing with different ways so you just learn different ways of doing things and different ways of thinking about things and so just constantly learning is probably my personal habit I suppose. But I can see why it’s not necessarily always good because you’re always trying to learn new things and sometimes like I said it is probably better just to be applying knowledge rather than just viewing knowledge for the sake of building knowledge because it’s irrelevant. All this knowledge you’re building, you don’t need it so what’s the point and you’re probably pushing out of these extra lines you got out of your brain for something so I think the key for a lot of people it is just to apply their knowledge and focus on whatever they’re doing is creating value. And whether that value is valuable to them is going to be different for different people like, for me the value for me is when I talked about I don’t want to be driving around signing off signatures because that time I could be spending my kids kicking the football.
For those interested in hearing more about Darren Standish, his business and his achievements, you can find him active on many social platforms and even hosts his own podcast.
They can take me on a whole pile of different places. I’ve got my own podcast which is called Property Secrets where I interview these whole lot of experts just like you do Tyrone. And then also I have a Facebook group called the art of property investing so they can check that out. I’ve got my own Facebook pages as well. So Darren Standish my business school property prosperity so you can check out my fan page on there on Facebook Instagram Twitter a whole pile different stuff so I’m pretty much everywhere.
I’m just putting out huge amounts of content, I do a lot of videos getting out there just showing people with things and I’m out and on-site showing that with subdivision’s I’m doing and talking about retaining walls of stone water or trees or easements and just trying to really educate people because you know there’s no secrets out there at the end of the day it’s just going to help people out.
It’s going to make them make their life a little bit easier and like I said it’s just I want them to have to go through the pain that I’ve had to experience so yeah just get out there and grab all the information you can and just learn as much as you possibly can and then when you’re ready to reach out send me a message or a Facebook message or text or a call or an e-mail and happy to answer any questions you may have.