'We had to rebuild our portfolio from scratch'

Tim and Karina's first foray into the property market wasn't entirely successful, but when they were told to sell everything and start again, they were more than a little shocked. 

“Years ago we had a number of properties. We had our primary place of residence, we had an investment property, we had a holiday house and my wife, Karina, had her name on the title of another property. So we were kind of involved with four properties – but we were very keen to become active property investors and try to set ourselves up for the future. 

The way we had set up our portfolio was quite messy. We were the classic case of cross-collateralisation, which was obviously going to limit us moving forward. 

We spent some time with a property mentoring company and we had to make some serious changes. The key thing was aligning our property strategy with our finance strategy. The other key thing was mindset. We did have investment properties, but we needed to remove the emotion.

We didn’t understand the impact that it can have if you get your finances wrong. If you get your finances wrong from the beginning then you’re in big trouble. 

As I said, we were the classic case of cross-collateralisation and our portfolio and finances were a bit of a mess. 

In our first meeting with our property mentor, he said “sell your properties”. It came as a bit of a surprise, but it was very good advice. 

So we spent six months selling up all those assets and starting again to get us back on track. Up to this point, we haven’t even made a loss, which is fantastic. 

We have bought a new investment which we are very proud of and it’s very much aligned with our investment goals.

It’s the first time we’ve bought outside of South Australia. We bought in Queensland – which was very exciting – in a suburb that’s been identified as a growth suburb, about 17 kilometres south of Brisbane.

We secured a tenant very quickly at above the market rate. We’re looking forward to re-evaluating the property in about 12 months’ time and locking in some equity growth. 

Our advice from our experiences would be to take emotion out and look at the bigger picture. With that bigger picture view, you can build a strong foundation and get your finances right. If you don’t do that, you’re going to limit yourself very quickly.” 

'We had to rebuild our portfolio from scratch'
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