From northern Indian origins to a national property portfolio

As a young man in India, Mahesh Yadav was already drawn to the idea of using property to achieve financial independence. But encouraged to pursue a more “respectable career”, he went on to become a managerial-level electrical engineer.

As he enjoyed increasing success at work, and moved to Australia via some years in Dubai, the property idea took hold again. Mahesh had bought some land in India but the real estate landscape in Australia presented an entirely new challenge.

It’s a challenge he took on with determination and zeal. Describing his philosophy as a simple one based on numbers, almost all of his investments across Australia have been bought sight unseen.

By the end of this year, Mahesh expects to have acquired his tenth property and perhaps even found a place to live!

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You’ve built a solid portfolio of properties but only arrived in Australia in 2015 from India. Please tell me a bit about your upbringing and life in India.

I came from a very humble background back in Varanasi, in northern India. My father was a government employee and my mother was a housewife. I was always fascinated with finance, reading about how money works and how to get access to it.

A love of property came to me early in my childhood, as my father used to buy and sell properties back in India. I came to know that real estate is one of the options to achieve financial stability and independence. But in India the real estate market is not very structured compared to Australia. There are no websites listing the value or sale price of properties. I am convinced I honed my negotiating skills haggling with sellers in India.

How did you come to be living in Australia?

My father didn’t like my involvement in the real estate business as it’s not seen as a respected job in our part of the world, so he convinced me to study engineering and get a job in the corporate world. I finished my electrical engineering degree and started working for a telco giant. Ascending the corporate ladder, I moved to Dubai, saved a few grand and bought my first land (in Varanasi) back in 2009. This was my first real estate asset.

In late 2012, I bought two more properties there. By 2015, I had saved enough money and decided to move to Australia for a better future. After the move, my primary focus was still investing in India because of my familiarity with the market.

Once I settled in Sydney and got a job with a multinational, I started to read about the Australian property market. It was very different to the Indian market, but in a good way! Here, all the data and history are easily accessible, whereas in India buying a property is a gruelling experience.

Your study obviously paid off.

I started to work as engineer with a big telco firm, which left little time to follow my property dreams.

It was 2016 when the Sydney market was at its peak that I started my search in southwestern Sydney. Relatives suggested I get a property in Glenfield (36km southwest of Sydney) but I was reading the news about a proposed new western airport in Badgerys Creek. So I targeted my search in Liverpool (10 kms closer to the CBD), for my first real estate in Australia. My target was an apartment, as houses were so costly. In 2016, every open house I went to was full of prospective buyers and it was very hard to negotiate the price. I had missed couple of properties; people were paying whatever the seller asked.

Ultimately, we found a three-bedroom apartment listed for $585,000. We finally settled, after much negotiation, for a final price of $546,000 in September 2016.

At what point did you realise you’d like to expand your property aspirations and what was the strategy to do so?

Being a single earner in a family with two daughters, my broker told me I had hit my serviceability ceiling, having borrowed the maximum allowed with one income. Meanwhile, I was reading all the books available related to property investment, checking all the property forums and listening to podcasts to gain an idea of how people manage to get multiple properties.

One day, HSBC bank representatives came to my office to offer loans to the employees and I discussed my financial position. After the revaluation, I was told I could refinance and withdraw only $20,000. I refinanced my loan and used the 20 grand to finalise a car loan, at which point I had one manageable home loan.

After 2017, it was all over the news that the property market was slumping. But when my wife started working, I felt we were back in the game!

The property market has been quite turbulent over the past few years. How has this impacted your portfolio and how have you responded?

It’s clear 2016-2017 was the peak of the market. I believe the news headlines play an important role in the market’s psyche. I was reading negative headlines everywhere that property was going to bust, and APRA tightened lending criteria. But being ready with a deposit and with the second income from my wife, in October 2019 we got our second property on the Gold Coast. It was bought sight unseen, but the numbers suggested it would be cashflow positive and the price was reasonable.

By December 2019, the market was on the move. I secured my third investment property north of Brisbane, a two-bed apartment. In March 2020, amidst the crisis, I secured my fourth investment property, a house on a quarter acre block in Brisbane for $205,000. By September 2020, within two days, we settled two more properties; one in Western Australia four kilometres from the CBD, and a house in Brisbane.

How do you manage the rental process in different states?

I have never managed a property myself. I have property managers because I don’t have time. I have a full-time job!

The numbers never lie. Seeing a property can influence your mindset and affect your willingness to pay more for it. I have bought five out of six properties sight unseen, just based on the numbers. If numbers stack up, I will negotiate hard. And I always make sure to have the building and pest inspection done before settling on any property, to alleviate any sense of risk.

How has it been accessing credit and do you shop around or use the same bank?

As the experts say, you need a wonderful team around you. I feel humbled and grateful that I came across some of the best brokers, accountants, buyers’ agents and mentors to guide me.

I always focus on finance availability rather the chasing low interest rates. I never shop around for better interest rates; rather I would look from where I can borrow the money for my next purchase. If a bank is comfortable lending me money, I will stay with that bank, unless and until it stops lending me money!

What is the research and property search process when buying in different states?

For me property is just the medium to reach my financial goal, like stairs to the roof! I never go for flashy buildings, or apartments or houses in premium areas. My investment method is to look for value. I always analyse comparable sales, rental markets, stock availability and growth prospects. That is why, at the moment, I am targeting capital cities rather than regional areas. But the dynamics are changing post-COVID, and some regional areas are now booming. I will monitor this with a view to investing in regional areas.

What is your advice to people who were once in a similar situation to you?

Fear is biggest deterrent to achieving any goal in life.

People would say you cannot invest here, you cannot buy there. Some told me just to buy land, some told me buy within a 10 kilometre radius of the CBD, don’t take loans from that bank because of the high interest rate, and so on.

They made you think property investing is a Sisyphean task but property investing is something anybody can do; they just need proper guidance and the right team to support them.

What’s next?

My goal is to get 10 investment properties by the end of the year and to finally settle on our principal place of residence. My daughters are in primary school, and we haven’t yet decided on a suburb. So, for the time being, I am following the rentvesting principal.

What’s your favourite and least favourite thing about living in Australia?

This country has given everything I could have dreamt of. I couldn’t complain about anything.