PHOTO: Lachlan Vidler has taken a conservative and disciplined approach to investing, and it’s paying dividends
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At first glance, serving in the military and investing in property may not seem like a perfectly complementary match.
But for formal naval officer Lachlan Vidler, his experience has helped guide an investment strategy that’s resulted in him assembling a property portfolio that he conservatively values at around $2.5 million.
Mr Vidler said investing in property had been a lifelong goal that first germinated at a young age, being a key element of his youthful dreams of one day becoming a billionaire.
And as Mr Vidler grew older, his passion for property started to become a realistic pathway to achieving his goals, with lessons learned in the navy a crucial foundation for his success.
First and foremost, Mr Vidler said the discipline instilled in him through his years of service held him in particularly good stead when it came to property investing.
“To invest in anything you need the discipline to set yourself up right first and you need the discipline to be able to do your research and understand what you are doing and you need to maintain that discipline afterwards to either keep growing, or ensure that what you have purchased or invested in continues to perform well,” Mr Vidler told Australian Property Investor Magazine.
“I would say planning is probably another one, being able to plan out exactly what you want to do and work out the steps that you need to take to get there is really important.
“I like the old saying ‘how do you eat an elephant? One bite at a time’, I think it’s great and it really works well with property.
“You’re not going to be able to buy property overnight and you can’t save $50,000 or $100,000 overnight.
“You have just got to keep plugging away at it and you have got to plan it out and set yourself goals and targets and things like that so you can keep on track.
“Then eventually, if you have the discipline and you’ve planned it out well, then you will achieve some success.”
Mr Vidler said the other key element of his military experience that’s helped shape his investment strategy is the ability to determine an acceptable level of risk.
“I wouldn’t characterise myself as a risk averse person, I would say the military background was really good to be able to look at risks, understand them and then mitigate them as best you can and then choose to do it or not,” he said.
“But then the other part I would say that’s probably unique about my background is the fact that I have a pretty in-depth education.
“I’ve got a business undergraduate degree, I’ve got a finance masters degree and I also have a graduate certificate specifically in property investment.
“All of those things combined with a military background have really allowed me to evaluate the risks as they are and then be able to make an informed decision on them.”
After leaving the armed forces, Sydney-based Mr Vidler established buyer’s agency Atlas Property Group after having provided property investment advice to friends and family and helping them also find success along the way.
He has also co-authored a book, A Military Guide to Property Investing, which is set to be released in September.
Mr Vidler said his investment strategy was more rigid than revolutionary, with several key elements adding up for sustained capital growth.
“The first and biggest element is that I like to look at land,” he said.
“I wouldn’t necessarily say a 300sqm property is instantly a bad investment because if I could buy it for a dollar it would be a fantastic investment, but I love to look at the land and what’s there, and what I might be able to do with it in the future.
“I like to also look at value-add opportunities, whether that is something really simple like a cosmetic renovation like paints and carpets, or through to full-on development potential like subdivision or building multi-dwellings.
“That links in quite well with looking at the land, and past that, I like to look at how it fits in the overall suburb. If demand in the particular suburb is high for three-bedroom houses, then I want to be buying a three-bedroom house, I don’t want to be buying a five-bedroom mansion.
“It’s the same if it’s a one-bedroom place, I like to see how things fit in with the overall demographic of the area.”
With investor lending up nearly 70 per cent over the six months to May, Mr Vidler said speculative activity was clearly increasing in Australian property.
But he cautioned that even as property markets across the country recorded an unprecedented simultaneous upswing, it is not necessarily a fait accompli that conditions conducive to capital growth will continue.
“Anytime is a great time to invest in the property cycle – Australia is made up of tens of thousands of markets and you just have to make sure you pick the right one,” he said.
“At the moment, we are past the stage where you can buy absolutely anything and it’s going to do really well, so you have to be very careful and very sure of what you are doing to make sure you don’t buy into a market after it’s had its heyday and it’s past it’s point.
“And that’s when I’d say for investors who aren’t sure, ‘look towards a buyer’s agent, or look towards an expert that’s going to help you out.
The risks of people just buying sight unseen with no building inspections, throwing money at something, often 20 or 30 per cent more than what it’s worth just to get something, that’s when people are taking on, in my opinion, too much risk and they are probably not going to have the most ideal outcome over the medium term.”
Mr Vidler said the biggest current challenges in Australian property, and particularly in his home city of Sydney, were knowledge and access.
“With all of the lockdowns it makes it very difficult if you want to buy an owner-occupier type property in Sydney, because you can’t really get out to inspect it.
“Investors are always a bit more willing to buy sight unseen, but even with that, you can’t even get people on the ground out to look at it, even agents getting out to see properties is a bit more difficult.
“Another thing that flows off access is stock. People are holding onto properties because they don’t want to put it on the market in a lockdown, and then suddenly it’s been on the market for five weeks but people haven’t been able to get through it and it almost looks like a stale listing.
“And in terms of knowledge, people love to jump on board the property market when the media reports on how well it is doing.
“That’s where everyone thinks they can make a quick buck, but a lot of people go into investing without a really good base of knowledge.
“If you are going to do that, you have two options. Stop and learn yourself, and understand what you are doing, or pivot, realise you don’t need to know everything, just like a doctor doesn’t need to know how to fix their car, but look to a professional who can help you.
“You’re going to pay a cost for that, but it’s going to save you spending 12 months trying to learn about property yourself.”
Also central to Mr Vidler’s strategy is a careful analysis of what point a particular market might be in the property cycle.
However, he said he’s not one to try to invest when he thinks the market has bottomed out, as many speculators in property investment like to do.
“I like to see markets that are already moving,” Mr Vidler said.
“A lot of people try to time the bottom of the market and get the benefit of the entire upswing, but I actually like to see movement, I’m happy to sacrifice four or five per cent of the growth to see it’s moving, to know that it’s out of the bottom and it’s actually going through a rising market stage, because you de-risk massively.
“If you can de-risk and you sacrifice four or five per cent, but get the rest of the growth, which can be 15 per cent or 20 per cent or even 30 per cent, that’s so much better than holding onto an investment that doesn’t get off the bottom and you have to hold it for five years before it does something.”