From foreign coups and humble beginnings to a 46-property empire

Watching her mother get injured by a stray bullet that grazed her forehead during a Kenyan coup, having the family home ransacked by soldiers, and enduring hardships to which no child should be subjected, were among the catalysts for Anna Correia to dream of a new life in far-away Australia.

Growing up in the bustling streets of Nairobi in a family unable to afford a good school was far from easy but it instilled the resilience and ambition that would eventually come to fruition in the form of a 46-property portfolio spread across two continents and financial security beyond her most lucid youthful dreams.

A generic green government migration booklet she encountered at the age of 13 proved to be defining moment, igniting a goal that wouldn’t be quashed.

Years later and married to a young accountant in the airline industry, his work took them to Abu Dhabi, UAE, in 2004.

It was there, with little money and an accounting qualification that they applied for the skilled migration visa to Australia and on a 45-degree day in January 2006 they landed at Sydney International Airport to start their new life.

Despite the challenges they faced – including the lack of a job, minimal savings and no family awaiting their arrival – Anna and Melvyn embraced the opportunity for a fresh start, driven by their unwavering belief in the promise of new beginnings.

First tentative property step

Everyone’s first property purchase is a nerve-wracking experience, and they were no different.

“Our first step onto the property ladder occurred somewhat unexpectedly when we were convinced by a friend to invest in a one-bedroom off-the-plan apartment in Hurstville, Sydney, in 2007,” Ms Correia (48) said.

“Despite our lack of knowledge about strata requirements and growth prospects, we were enticed by the prospect of no deposit being required until 2009 and the benefits of the First Home Owners Grant.”

The first property is often the hardest to acquire and for this couple it required its share of social sacrifices.

“Saving for a deposit required us to forego other potential uses of our funds, such as leisure activities or personal expenses.

“Education was also key, as we undertook at least 10 property courses, attending seminars and networking to develop the knowledge required to formulate the required mindset and establish the appropriate strategies.”

Building a property empire

So how does someone go from a one-bedroom apartment to 46 properties, 11 in Australia and 35 in the United States, in under two decades?

In a nutshell, by being very focused, organised and determined.

“We created a vision board with pictures of what financial freedom would look like and concluded the overarching vision was to earn a passive income exceeding net $500,000 per year by December 2025.

“We split our goals out into sections and do our best to revise and update these on an annual basis.

“We aim for at least three goals under each section, namely career, finances/wealth, happiness/family, relationships and health.”

When it comes to structuring their property business model and determining the location of their investments, they have adopted a similarly orderly and methodical approach.

“Assessing how best to purchase the properties and in which structure was important, so we needed to address how to access first home owners grant, protect the assets, plan for the transfer of the assets to our beneficiaries, and optimise taxes.”

Property locations a combination of risk and reward

Determining the locations within Australia of their property purchases was governed by three strategic factors: an agreed upfront extent of overall negative gearing levels across the portfolio, the potential for capital growth, and the potential to leverage off investments.

“At the start, the location was heavily influenced by budget and income levels as we had just arrived in Australia and income and savings levels were less than $20,000,” Ms Correia said.

“We determined that off-the-plan was a way to get a foot in the door that required minimal upfront payment and a deposit only due two years later.

A follow-up purchase rode the wave of investment into a mining town as the resources sector boomed.

“We took a strategic view into mining towns with very high capital growth expected as well as significant positive cashflow as a way to leverage.

“We knew this was highly risky but felt the entry point was good.

“We purchased a house for $200,000, which grew in two years to $400,000 and pulled out the equity to allow further purchases.”

The couple then used the equity from the mining town property to acquire two properties, a unit in Rockdale and house in Ruse.

“The strategy here was to identify properties with low entry point and capacity to add value via renovation.

The choice of location was driven by affordability, community atmosphere and demographics, proximity to Sydney and the announcement of the M5 road expansion at the time, good infrastructure and amenities.”

Their next purchase was a three-in-one house in Newcastle.

Encouraged by favourable press at the time around regional infrastructure improvements, and with consideration for the ageing population in Sydney that tended to move to the central coast for retirement, they decided to capitalise on the beautiful beaches in the area, lifestyle and culture, and employment opportunities.

The proximity to major coal mines in the Port of Newcastle also was an attraction.

The choice of property again was based on a very low entry point and a need for renovation.

“The overall resulting planned income would then offset the negative cashflows from the other properties,” Ms Correia said.

Their next purchase was in Padstow, near Bankstown.

“We were renting in Panania at the time and really liked the area and the strategy here was to secure an asset with a dual income opportunity.”

The last purchases in Australia included a purchase in Brisbane in the Wynnum West area but Covid wrought havoc with their ambitions for this investment.

“The original plan was a joint venture agreement to acquire a property with a large enough block of land to subdivide it, build two residences and sell and exit.

“We got caught up in the pandemic and construction costs skyrocketed.

“Since that time, one of the houses has been completed and the other is still being constructed.

The cost for the first one was similar to the sales price and as a result there was a mutual agreement with the joint venture partner to terminate the agreement with no loss sharing, and instead the strategy would change into a buy and hold.

“The adjusted plan now is to let time pass and this will then allow the properties to grow in value.”

Even the best laid plans will face obstacles, and the mortgage cliff proved to be another.

The transition to higher variable rates has led to increased mortgage payments, impacting the portfolio’s cash flow significantly.

“This has necessitated a reassessment of our budget and financial projections to ensure that our properties remain cash flow positive, or that we can weather the storm until interest rates stabilise and decline.

North American property adventure

The venture into US property has also reaped dividends.

Diversification remains a key strategy for mitigating risk in investment portfolios.

The investments in the US market have provided stability and resilience during some challenging times in the Australian market.

“Continuing to diversify across different markets and asset classes has helped safeguard against adverse market conditions,” Ms Correia said.

The strategy in the US is different in that it involves purchasing a house, on-selling it to a third party and acting as financing body (or bank). Income derives from interest payments on the mortgage, and locked in capital growth. All ongoing costs relating to maintenance, rates, insurance etc are borne by the home owner.

“It is a true win-win proposition in allowing more people in US to acquire homes while providing an income for the private lender.

“As a simple example, A$1 million would purchase very few similar houses in Australia and they would likely need to be negative geared (with rental yield less than 4 to 5 per cent), whereas the same value would allow for up to nine similar houses in the US with a positive cashflow between 12 to 58 per cent.”

The couple have now established a business, WeConnectYoutexas.com, to connect Australians to the US market.

But when it comes to the local market, Brisbane is the city they have their eye on at the moment.

“We believe Brisbane will do really well and this simply arises from the pattern of migration from other metropolitan areas into Brisbane.

“The central coast is another area that catches our attention, because as the population ages the constant theme we see is people selling up their houses and moving to a more affordable area that has beaches, lifestyle and health facilities.”