Since 2009, Sze Chuah has acquired 21 properties. He says his aggressive portfolio growth was only possible thanks to the instant equity generated from smart buying.
Sze, 34, says he got into property out of necessity.
“My wife had a pretty tough time with her previous employer,” he explains. “She was going through hell and came back crying every day. One day she said, ‘I don’t ever want to have to work again’. I thought that sounded nice – but how were we going to afford that?”
Sze started looking at a number of different investment strategies, including shares, options and futures. He decided the best strategy to build wealth for his family was to buy below-market-value properties and acquire a balanced portfolio.
Sze and his wife, Mandy, had “a bit of capital behind them” thanks to Mandy’s owner-occupied home, which she sold when they got married.
“That helped us buy four or five properties, but after that we relied on equity growth to keep leveraging into new purchases,” he says.
His buyer’s agency, Right Property Group, helped the couple secure below-market-value properties, which enabled them to keep recycling their deposit through equity growth.
The couple’s portfolio is now worth over $6.1 million and has an average rental yield of 9.04 per cent – with no properties currently yielding below 6.5 per cent. The best yielding property – a three-bedroom, one-bathroom house in Moree, NSW – achieves an immense 16.77 per cent return.
The portfolio has also experienced capital growth of almost $2 million in just over five years.
The couple now earn over $300,000 per year in gross rental income, but Sze says his family can’t quite yet live off the portfolio’s proceeds.
“We’ve made some good gains in terms of capital, but we obviously still have a fair bit of debt. We’re working on making the portfolio completely unencumbered.
“We have a couple of young kids so my wife is able to look after them on a full-time basis. I guess I’m pretty proud to be able to say that she doesn’t have to get back into work and back into a job that she associated with a lot of pain.”
Sze says he didn’t expect he’d be able to use equity to build such an extensive portfolio.
“To be honest, I started with the goal of buying one a year for two or three years,” he says. “I was thinking a portfolio of three or four properties was probably pretty considerable.
“We had a family friend who has six properties and we were always looking at him as a role model, thinking ‘Six properties – wow!’ Since then, obviously we’ve come a long way.
“The target has continually shifted. Currently, the goal is to start expanding the portfolio again in a year or two years. Who knows, maybe I’ll hit half a century one day!”