PHOTO: Sam Gordon
A high school dropout has revealed how he amassed a property portfolio worth $43 million in just over 10 years.
Sam Gordon, 34, was motivated by his tough job of moving feed bags around drought-stricken farms in NSW’s Southern Highlands.
He began his impressive journey at 19 with a two-bedroom unit in Wollongong purchased in 2009.
Using a clever two-part purchasing strategy, Mr. Gordon continued to buy homes until he quit his farm job at 28. He now earns an annual passive income of about $2 million, holds 60 percent of his portfolio in equity, and recently signed contracts for his 76th property.
Mr. Gordon explained that his first key to success was buying properties in high rental return areas for below market value by taking on homes “most people wouldn’t touch.”
“They’re usually really rundown,” he told realestate.com.au. “Banks often won’t lend on them because they’re uninhabitable. I buy them in cash or with very low debt loans and renovate them.”
“The trick then is to take out the equity I’ve created by refinancing the loan and using that money for the next project.”
The second key part of Mr. Gordon’s strategy is only buying in areas where the potential rent is well above his mortgage repayments. He put a lot of effort into researching high-value and growing areas.
“What I found was a game changer when it came to getting loans was being a rentvester,” he said. “Banks look at loans on your residence as a liability. It limits what you can borrow. If you’re renting, it’s a lot easier to build up your investments faster.”
Mr. Gordon started saving for his property when he was just 16, earning $38,000 working on farms. He recalled hauling “putrid” smelling feed around in 40C heat, admitting he had no intention of doing it for the rest of his life.
Sam Gordon (pictured) quit his job as a farm labourer at just 28 years old after building a massive property portfolio
Mr Gordon (pictured) earns $2million a year in passive income and just signed the contracts for his 76th property
“All my free time I put into renovating properties. That was basically my holidays,” he said.
After renovating the unit in Wollongong himself, Mr. Gordon used the equity to buy another unit in Moss Vale. He continued this strategy of renovating and improving properties himself, using the equity to build the massive portfolio he has today.
However, Mr. Gordon doesn’t take on any home; he prefers his investments to be free of structural issues. He highlighted a challenging project in Perth where he had to replace the ceiling over the kitchen. Luckily, this step out of his comfort zone paid off, with the property doubling in value and significantly improving his cash flow for future renovations.
Mr Gordon began saving for his property when he was just 16-years-old and earning $38,000 to help on farms
Last year was one of Mr. Gordon’s busiest as skyrocketing interest rates meant there were fewer buyers to compete with.
“I think if you’re clear about what you want to accomplish with property, you can start forming strategies that can get you there,” he said.
SOURCE: THE DAILY MAIL