Pilot lands a first-class property portfolio
No matter how much this Perth-based international pilot focused on steady, risk-free property investments, global events often made the path more interesting than he might have liked.
As you might expect from someone who has made their living as a pilot traversing the world on international flight routes, Carl Baker has built a solid property portfolio that displays some international flare.
From a humble first property purchase in 1998 in Melbourne’s inner suburban Elwood, a few properties have since been bought and sold along the path to building his current portfolio comprising property on both sides of Australia, as well as Hong Kong and Bangkok, with a dabble in the Macau market having also taken place along the way.
Mr Baker grew up in Kalamunda in the Perth hills area and at 18 joined the Royal Australian Air Force.
He spent nine years living out his schoolboy dream job, based mainly in Sydney.
With the demise of domestic carrier TAA in 1994, Ansett in the 1990s was one half of a duopoly with Qantas that ruled the skies in Australia.
Pilot roles in Australia were highly competitive at the time but Mr Baker’s air force experience secured him a position with Ansett in 1996.
With a solid career path mapped out and some savings built up Mr Baker took his first step onto the property ladder.
That safe and affordable purchase eight kilometres from the Melbourne CBD was a renovated duplex with two bedrooms and one bathroom picked up for $250,000. While the median house value today in Elwood is close to $2.3 million (and $645,000 for units), at the time this outlay was sizeable but manageable.
That property was sold three years later, with only a few cosmetic improvements made, for $365,000.
With profits from that sale in his pocket and a taste for capital gains, Mr Baker that same year, 1999, bought a three bedroom, one bathroom Edwardian weatherboard home in Williamstown in Melbourne’s southwest.
The poor condition of the weatherboards and a few other changes saw him plough $100,000 into renovations before a major career transition prompted him to sell the $365,000 purchase two years later for $520,000, realising a small profit.
With perfect market timing that was later echoed in a string of property purchases in Australia and abroad, Mr Baker took a pilot job with Dragonair, a subsidiary of Cathay Pacific, in 2001, the same year in which Ansett folded.
Mr Baker spent the next two decades in Hong Kong forging a career that saw him rise to rank of captain, assume senior company employee representative positions, marry and enjoy a life among his fellow expatriate and local friends.
Win some, lose some in property
Not every property deal that followed during these years of relatively high income serving destinations across China and the Far East, Southeast and South Asia.
A three-bed, two bath townhouse in Perth’s inner north suburb of Highgate was bought and sold for $590,000 after a few years generating no profit. The development had aged poorly and its dated design could not compete with an array of modern developments and urban infill townhouses and units that were sweeping through the area.
With an eye on the burgeoning Hong Kong property market and a close affiliation with Thailand through work and family, Mr Baker set his sights on Asian property.
A small dalliance in Macau was followed by a mid-priced buy in Hong Kong Island’s centrally located Mid-Levels. The A$800,000 two-bedroom apartment was picked up in 2007 and sold in 2016 for almost double the purchase price.
“There were some scares around the time of the GFC (global financial crisis of 2007-08) when prices fell sharply but we’d seen the same thing happen when the SARS pandemic hammered the city’s property market (in 2003),” Mr Baker said.
“Prices fell by up to half at the time but they rebounded quickly.
“For those who had the nerve and foresight to invest at the short-lived bottom of that market they did very well for themselves in just a matter of months.”
But avoiding risk and volatility has been a hallmark of Mr Baker’s accumulation of property portfolio that he estimates to be “worth a few million”.
“I would never overextend myself financially to the point that I couldn’t sleep at night,” he said.
“I don’t have a set strategy other than aiming to buy properties in which I see potential upside based on that location’s economic prospects.
“Hong Kong enjoyed a real boom through the 2000s and 2010s and my properties have done well, although the only property I now own there has slipped a little from its peak value since Covid and the other changes that have taken place in Hong Kong.”
That property is a three-by-one unit in a 50-year-old building in the Wan Chai, a business and entertainment precinct a couple of underground train stops from Central. It was purchased in the mid-2010s for A$1.2 million and would now be worth closer to $1.8 million but had likely reached as high as $2.2 million before the Umbrella Revolution and subsequent crackdown changed the city forever.
He now also holds a property in Bangkok, bought off-the-plan a few years ago for $520,000, the two-by-two apartment in a facility known as The Lofts boasts facilities such as a pool and gym and has been kept as a holiday home and base for visits to the Thai capital.
The best investment is your home
While he may have always sought stability and shunned volatility in his property investing strategy, sometime trouble finds you.
When Covid hit Hong Kong, it spelt the end of Dragonair and Mr Baker’s job.
With the city shuttered up for years under some of the strictest pandemic conditions in the world, he moved with his wife back to Perth and closer to his son who works in Sydney.
“The idea of returning to Perth had always been in the back of the mind but wasn’t front and centre until Covid struck.
“But I had placed an investment emphasis on securing the house that I would one day call home and that is where I now live in Mount Lawley.
“My early purchases always tended to be in the cappuccino belts or fringe areas in the up and coming suburbs or districts on property I could afford with a 50 per cent deposit to keep interest rates at bay and repayments down.
“I’ve been lucky in a mostly rising market over the last 25 years, and also being employed up until Covid so I could get a mortgage!
“I expect the Perth property market to remain strong due to high employment and I’m hoping Hong Kong recovers.
“I now want to live in a home that will have capital appreciation over time, so coming back to Perth the first time is when I purchased my latest home as my retirement home.
“Since buying in 2017 it has had steady growth that’s added around $200,000 to its value.”
Mr Baker is now flying for a Western Australian carrier and with planes in his veins, spends many of his spare weekends flying his former RAAF training aircraft from its base in Northam and performing hair-raising aerobatics over the wheatbelt regions of WA, while also playing masters Aussie rules football in Pickering Brook and loving life back home.
“The best investment is your own home,” he said.