Investor In Focus - Alan Yeung
As a second generation migrant to Australia, it was Alan Yeung’s father who instilled in him the importance of setting up roots in a new country. With that mindset, from an early age, Alan started looking to buy a home for his family and from that point onward, his passion for property only continued to grow.
“My father said to start up in a new country, it’s always good to get a foothold and that the first thing to do is to buy bricks and mortar and that got me into buying my first property.”
That was in 2006 and now more than a decade on, Alan and his wife have built up an impressive property portfolio across both Sydney and Melbourne.
However, the journey to get to that point in a relatively short period of time hasn’t necessarily been an easy one - particularly early on. It has taken time, effort and a lot of hard work to get to where he is today. According to Alan, one of the biggest challenges was getting into that very first property.
“With my father’s help, I was able to purchase my first property. Then, as the property grew in equity, my income also grew. Then we eventually got some money together to repay him. But it wasn’t easy.”
For Alan, his property journey has been slow and steady. He only continued to invest in more properties as his equity and borrowing capacity grew.
“It’s not a coming of age type of story where you buy one and then you buy two and you buy five and you buy ten. It didn’t happen that way. It simply comes with time.”
Alan’s investment strategy has been to purchase properties in good locations that have a mix of both yield and capital growth potential. In particular, he is focused on areas that are close to amenities, shopping centres, schools and universities.
One of the key’s to his success is that he has always followed property prices closely. So when the opportunity to invest presents itself, he is ready to quickly act and make smart decisions at the same time.
“My dad had always taught me to watch prices regularly. Not daily because we’re not in the stock market. Understand why properties go up and down and in the long run, has a particular property or area gone up? We’re not really concerned about short-term drops as long as, at the point in time when you purchase, it’s something that you’re comfortable with.”
One of the keys to his success so far has been the way he has assessed each individual property he has invested in. Alan believes that just because a property is listed at a certain price and has a particular rental yield, doesn’t mean that you have to accept them.
Getting a better rental yield, in particular, is something that Alan looks to do on certain properties and it can make a huge difference in your ability to service a loan.
“Prices-wise you can’t always tell if it’s a property that can have a good yield. When you purchase a new property you can always remove the old tenant out and find a new one.”
“We will always try and find properties that have a good source of income, that are easy to lease in a good area. Good as in it has amenities such as a university, hospital or near a major employer or a technology park.”
“So some of the areas would be your Artarmon, North Ryde, St Leonards, which has a tech area and as well as a hospital or Macquarie Park.”
For new investors, Alan believes that the most important this is to define your goals and then don’t wait too long to get started.
“Have a clear goal of what you want in an investment property and list them out. It’s always an easy option to say, “I’ll wait.” But then, to me, you’ve just wasted that month or three months or a year, six months, that you’re in the market looking. So whilst you can borrow now, or if you’ve got the funds ready to purchase, look for what is the best property in the market today and just act upon it.”