Unicorn Property Hunters - dashdot's Goose And Gabi
Buyers agent Glenn "Goose" McGrath, founder of dashdot, has taken the notion of learning from your mistakes to the next level. Following a disappointing start, due to a hastily and ill-conceived initial property purchase, the lessons learned from that transaction ultimately inspired a business with national ambitions focused on building wealth through real estate and helping the community.
API: You have accumulated three properties in the last 18 months. What lessons did you learn from your first property investment experience?
GM: Well, like most young couples, Gabi and I started our property journey by simply looking for a way to get ahead in life, and we figured the best first step was to try and get our foot on the property ladder. And, like most young couples, we made a mistake.
Despite the fact we thought we knew what we were doing, we, like so many other Australians, had basically no clue about what we really needed to know compared to what we thought we knew. We thought it was simple - property doubles every 7 to 10 years, right? Stands to reason that it doesn’t really matter what you buy, just get started!
So we basically ticked all the boxes of things not to do; we got bad advice, bought the wrong property, in the wrong place, at the wrong time. Despite making such an incredible comedy of errors, this turned out to be one of the best things that ever happened to us. That moment was a catalyst for change - for our life, and our property journey.
The day we signed the contract we raced over to a property investment seminar and that opened our eyes to things like cashflow positive properties, how to leverage equity and so on. Talk about an eye opener!
Suddenly, we looked around at the people who were finding massive levels of success in real estate, and at the tens of thousands of others - people like our friends and family - who were destined to make mistakes like we did. We decided then and there to dedicate ourselves to mastering the game of property, so we could not only take charge of our own wealth creation story but help others do the same.
API: Tell us about your portfolio and how you were able to purchase property by putting down only $1000 of your own cash?
GM: Gabi and I subsequently spent tens of thousands of dollars on property education and, while there are no gurus or any single course out there with all the answers, there were lessons we learned from that in terms of building a property portfolio that is self-sustaining, would put money into our pocket every single week, and would allow us to continue to build a scalable portfolio. For us, this revolves around the holy trinity – cashflow positive properties, in high growth areas, with value-add potential.
Our second property was bought for just $300,000, which was about $40,000 below market value. We moved into that property but it’s now rented out at a 5.2 per cent yield and it’s cashflow positive and sub-dividable. The real key lever for us was the well-negotiated entry price, as this allowed us to take that instant equity to buy the next property. We basically took that $40,000 saving and used it as the deposit, stamp duty, everything, for the next property, which we completed within less than four months. So, the only money we used was just $1000 for the inspections and such things.
API: Ultimately what do you hope to achieve through property?
GM: Impact and Inspiration. The reason we’re building a scalable property portfolio and the reason we’re helping other people is because we want to create massive impact. I want to live a life that can inspire other people to take action and for people to be inspired by our actions.
API: Goal setting is an important part of your strategy. Where do you hope to be personally in five years, and 25 years from now?
GM: We have a goal of 25 properties in the next five years, and this will likely be made up of a few different types of real estate assets. What we hope to achieve in the next five years is to have a passive income of $150,000. In 25 years from now, we want to have a global reach in our ability to enable other people to undertake their own property journey. This is about creating a life of abundance for ourselves but also creating a business that has a generational impact, to assist people to dream big and to help improve the lives of others in our community.
Dashdot – buyers agents specialises in sourcing investment properties that are under market value, with net positive yields, strong capital growth prospects, and that have value-add potential through various instruments, including subdivisions and renovations. They focus on affordable properties, in growth areas, that will deliver strong financial returns from day one.
It’s a philosophy built on impassive and data-based analysis and a focus on seizing the specific moment when the property stars align.
API: With the admirable aim of helping 250 everyday Australians transform their wealth creation journey by April 2020, you are now assisting others to dream big and to better their lives through property. What are the major investment problems, you help your clients overcome?
GM: The risks involved in getting wrong the most important investment in your life are significant. The biggest problems we tend to encounter are clients’ lack of time and lack of strategy. They don’t know where to buy, what to buy, or when to buy to make sure they don’t make mistakes. It’s also the reason people most frequently buy in their own backyard, which can be a recipe for financial failure. People who come to us are typically looking to fast-track their wealth accumulation.
API: With the vast majority of investors stalling at only one or two properties, what is your advice for those looking to buck this trend?
GM: Firstly, you need to get some advice. The number one biggest mistake I see property investors make is relying on their own ego. They are more committed to trying to be right or go it alone than they are to their own financial journey. They will listen to a friend or family member who has possibly bought one or two properties or listen to a podcast and think they’ve got it nailed. But it’s not tactical or well thought out. They need to be making data-based decisions that are going to move them progressively towards their individual wealth goals.
For those looking to buck the trend of getting stuck at one or two properties, it really is the simple fundamentals of cashflow positive properties, in high growth areas, with value-add potential. The reason you have all three of these things working together and not just one or two, is you want to create a wealth ecosystem that is going to keep putting money into your pocket day-in and day-out. The benefit of that is that if there is a change in life’s circumstances, like losing a job or health issues, you have a portfolio that is an asset and not a liability. This allows you to increase your equity, increase your cashflow and to keep compounding that.
API: A key ingredient to your service is locating hypergrowth or 'unicorn' properties for your clients. Can you explain what you mean by this and why smart asset selection is critical for investors looking to rapidly build their portfolios?
GM: A lot of people suffer from the buy and hope mentality and don’t understand what can be done with property. Unicorn properties do exist but only within a brief window of time. What we are typically looking for on behalf of our clients in the first 12 months is 15 per cent growth on the purchase price. A lot of people think of property as a 20-year journey, but I think we can wind that timeline back to five or 10 years if we are being tactical. Purchasing the right asset is the most critical thing.
API: What will the next five years bring for dashdot?
GM: We have a goal of helping 250 people by April 2020. We have much bigger goals in the longer term, expanding our reach nationally and helping thousands of people. We want to focus on the human story and create change. We’re massively excited to be building our own portfolio, and our business, and to transform the lives of others through charity and societal improvement. We’re going to be adding education programs, I have a book coming out in the next few months. We’ve got big goals and it’s all about reach and impact. It’s going to be an exciting five years ahead!