Join us in this episode as we learn how Chris’ upbringing had significantly influenced him into becoming a property investor. With no early interest in property investing, Chris was an IT graduate working in IBM until he discovered the beauty of property investing. With tremendous experiences and a colourful past, Chris has a lot to share!

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I showed her and I said, we bought this property, we went away, we made $30,000, and it's costing us nothing to hold. Let's do it again.

This is Property Investory where we talk to successful property investors to find out more about their stories, mindset and strategies.

 

I’m Tyrone Shum and in this episode we’re speaking with property manager and the founder of NextGen Property Management, Chris Dimitropoulos. We delve into his motivation for getting into real estate, his journey from Greece to Australia and his relationship with his parents, we hear his amazing aha moments, and much much more!

We learn a little bit more about what a typical day might look like for someone as busy as Dimitropoulos. 

01:16          I do quite a few things. I've been lucky, the real estate journey has allowed me to do a few things. So I spend a bit of time with a not-for-profit. So they're looking after disabled people. And I guess a lot of my experiences through real estate and property [inaudible] in their journey or in the NDIS. So I spend quite a lot of time with them. And I've also spent quite a lot of time with my business as I was saying before. And I'm the licensing side of the business. I'm responsible for all aspects of it. I spend a lot of time on social media. I'm quite active on the Facebook group that we've got as an admin, which is all about property. So there's never enough hours in a day, I would say. I wish there was more time. And a lot of it revolves around property and real estate in one way, shape, or form.

Dimitropoulos shares with us what the non-profit organisation that he works for does to help people with special needs. 

02:24          They're in the disability sector. They've got group homes. And that's the connection to property. So before I got into property management, I was in IT and I was project manager. So when I was looking for a career change I did two things. One is I started my own business and the other things at the same time. I started helping this not for profit organization, which is looking after people living in group homes basically. So a lot of the things to do with property relate to them. They've got tenants, which are people that stay there. And hence the connection.

We learn about the relation between his work with NDIS and whether that relates back to the properties that he works with. 

03:27          It's completely separate, but they're managing a tenant and managing a person with a disability. It's very similar. So properties need to be looked after and a lot of the logistics are very similar. So that's it, that's an industry that's moving and it's evolving and it's in its infancy, but I've got no doubt the worlds of the residential tenancies and the NDIS tenancies are sort of coming together and there’s a lot of similarities.

Dimitropoulos talks to us about his background and what it was like for him growing up. 

04:11          I was born here in Sydney. When I was three years old, my parents decided, they were Greek immigrants basically, and they decided they had it made, they sold everything and they went to Greece. And I lived there for the first 15 years of my life and as soon as I turned 18 I couldn't wait to come back. So I've been back since I was 18. I've been back now for about 25 to 30 years. And I guess a lot of my love for real estate has come from that because my parents were some of the first [inaudible] to buy a property in Alexandria in Sydney, they kept their [inaudible] for something like 7,000 pounds or something like that at the time. And after about five years, it had grown to 15,000 pounds.

05:06          That's in the 70s we're talking about now. And they sold it. They thought it was, they had it made and it was great. They went overseas and never bought a house. So I grew up basically as a tenant and I've always wanted, this is something that always bothered me. All my friends had their own houses and I didn’t. So I came back and my parents came back straight after me. And one of the first things that I did was, as soon as I finished university and got a job six months later I helped my parents buy an apartment and that was, you know, in three names. And I stayed there until it was sold basically. So this is safety, you know, it's always something that bothered me as well, wanting to get into real estate. So we bought that and my parents are still staying there and I'm forever grateful they've got a home. But that's one of the early influences in my life to go into real estate.

We get to find out what it was like for Dimitropoulos growing up in Greece and what studying there was like for him.

06:21          I was always a serial studier. So it was always drilled into me that I had to go to university there. So as a kid going to primary school and high school in Greece and I was an okay student you know, top 10%. But you know, same as most boys, I would say, you know, more interested in sports. I was a basketball player. I love my basketball and I was preferring basketball over studying most of the time I guess. But going into university in Greece is very difficult because places are sort of limited. So I needed to come back. I had like a 90% equivalent ATAR, but I couldn't get into university there but I could here.

07:08          So the month after I turned 18 I packed my bags, my parents put me on a plane and I arrived in Sydney and I have to say I arrived in Sydney with about $400 in my pocket. Because my dad was, you know, a taxi driver in Greece, never had a lot of money. So I arrived and he gave me about $400 and put me on a plane. I came here and stayed with you know, an uncle of mine until they arrived as well. So that's how my story starts. You know, I was in Australia, was 18. I went straight to university with very little money but a lot of dreams I guess as people have about going to university and I always wanted to study IT. I was obsessed with IT at the time, so I thought that was the way of the future. And I think that proved to be a good decision actually.

Coming to Australia with only a little bit of money, we find out about the types of jobs he had while he was studying at university. 

08:20          I've always worked even when I was living in Greece and always here, I've always had the summer job or the weekend job. I've worked in anything you can imagine. I used to drive a truck delivering jukeboxes before the digital music came out. So that was a great idea that someone had. That was about 20 years ago, jukeboxes to parties. That was the main job when I was at uni. So I worked all weekend just to drop off jukeboxes and pick them up in the end. I've always been a hard worker. And I'm just driven to work and do good with money and save and just always try and do the right thing I guess.

09:33          I delivered bread for a little while at night. So I would go to uni in the morning. That didn’t last too long because I kept falling asleep in the lecture. So I worked in a secondhand shop at Redfern. They were selling furniture, so I'd worked there as well. Someone had an idea to buy coal in bulk and put it into a small box and sell it, I did that as well. So lots of little things that are, you know anything I guess when you're at uni to just make a little bit of money on the side. And by that stage as well my parents had arrived as well, so I didn't want to be a burden to them as well. I’ve got a brother and sister and they're younger than me and you know, my dad came back and started from nothing again. So I really didn't want to be a burden on my parents. I was trying to help as best I could.

With Dimitropoulos coming back and his parents not far behind him, he tells us about the reasons behind his parents deciding to leave to go back to Greece when he was young.

10:40          I think the driving force was my mum, my mum always wanted to go back to be with family and so she persuaded my dad to pack up and go. They would have been here about 10 years before they left. But my mum always wanted to go back and be with her family and we went and rented a house in Greece about 20 metres from where his brothers and sisters were. So there's a strong family theme that I've been brought up with. And I think that's quite, quite important in my upbringing. And quite important with, you know, everything I do now. I think everything was around family, but that started from my mum. It was absolutely no financial decision because it's not that they were multimillionaires to go and retire there.

11:32          They're still in their 30s and they went back with no particular skills. You know and actually they're very risk averse as well. So whatever money they got out of selling whatever they had here, they put it in a bank and it slowly disappeared without actually doing anything meaningful. They had an opportunity to start a business. They could have bought a property the first few years, they didn't, and then the money lost its value slowly as the years go by and 15, 20 years later when I was about 18, they didn't really have that much. So it's just a few lessons there as well. But for me about how risk averse you can be and how cash basically isn't really worth a lot as time goes by. So you've got to put it somewhere.

Leaving Australia when he was so young to go to Greece, then coming back at 18, we learned what the driving force was to come back to Australia.

12:40          I didn't want to be a burden to my parents, so I was 18. There's not a lot of opportunities there. And that was before all the things happened in Greece as well where you know, the economy tanks, there were no jobs whatsoever, but that was even before that. But I didn't want to be a burden to my parents. I always wanted to come back for as long as I can remember myself. I wanted to go to university, which was going to be impossible to go to in Greece. And it was a lot easier here. So just using my marks. I came back, I translated them and I got accepted to go to the University of Wollongong to study an IT diploma at the time.

After he finished studying at university, we learned about his journey in the workforce and what type of company he worked in.. 

13:38          I went and got a job straight away. I was at IBM and I was the happiest person on earth. And I worked for about six months and within the six months my parents were still renting at the time. And my parents got a letter in the mail from a fund, I think it was called Montgomery fund, which was for people that couldn't afford to buy a property. And the fund, which had something to do with St George, allowed you to buy a percentage of a property. So we had to buy 30% of a property, three bedroom apartment at Lakemba. That’s where we were staying at the time and the fund bought the 70%.

14:35          And with the idea that we were like the owners, would pay, take care of all the outgoings and all that, and we had to give the 10% deposit of the 30%, and there was no stamp duty and all of that. And whenever we could buy the rest, we would buy the rest basically. So with all those jobs, I had saved a bit of money and helped put down 10%, it was about $30,000. Then the property was worth about $95,000. It was evaluated at that. We bought the 30%, and we started living in it and that was our house and it was the best thing ever. We had our own house with my brother and my sister and my parents and that was just as I was finishing university and then I finished university, but six months later I was working for IBM and they were offering loans and this kind of loans they had a deal with MLC I think at the time. And we bought the other 70% of the property and that was the first property in three names and it's still in three names. Myself, my dad's and my mom's and I've got it in my portfolio all those years later.

Dimitropoulos goes into more detail about the fund that allowed them to buy their first property and explains in more detail about how it worked.

16:06          There was a fund that was called the Montgomery fund. They must've put a few million dollars aside and anybody that wanted to buy their first property and couldn't afford, I guess low income, which was my dad at the time. They would apply for a grant and they could buy whatever percentage they want. So we chose about 30%, I think. So we only had to borrow $30,000 and 10% of that was $3,000. We had to come up with a $5,000 deposit, I guess. And the assumption was it was our house, would pay everything else or you could buy the rest anytime you are ready.

17:03          It must've been one of those weird things that governments were doing from time to time. I think it would have been like a state government initiative. I was actually surprised that nobody ever knows about that. But maybe worth looking it up. I think it's called Montgomery fund. I remember going into St George, it had something to do with the St George bank. You'd go into their branch and do the paperwork and everything else through there.

17:47          The good thing is that the fund made some money as well because when I finished university six months later, I had another income basically. So I finished university, I got a job, I had another income and then we could apply for our own loan to buy the whole property. So we had to buy this 70%. The property had gone from 95,000 to $120,000 by then. So we had to buy the added value of the property as well. So they made some money too. So that was good for everyone I guess. But it was a good idea, I thought. And I'm surprised I've never heard anything like that.

We learn about what influenced him to actually take the next step to buy his first property.

18:57          I guess what happened is I got a job and I wanted to do my first tax return and my accountant said to me at the time, you can save some tax if you buy a property. And I said, that's a great idea. I've always wanted to get my own property for, you know, later in life. So I might as well buy a property and said, you know, save a bit of tax at the end of the year. So believe it or not, my accountant who I still have all these years later, he's the one that got me to buy a property, but not for any other reason, but to save some tax. I had no idea what I was doing. For me, it was never about investing. It was more about, you know, safety and saving a bit of tax to begin with.

19:45          So I bought the property like you said. And then the next year [inaudible] property, we did the numbers and I got a grand total of $2,000 tax returns in the second year of my job and I thought that was amazing and I thought it was amazing enough to buy another one. And so, you know, then I've got a $4,000 tax for them. And that's how I started my journey through my accountant. In fact, I would say my parents tried to actively discourage me from buying properties. I would say, as I was saying before, they were quite risk averse. One of what the first one, great celebrations, but the second one that started sort of, you know, telling me that I shouldn't be doing this and you know, pay that off and whatever else. But you know, I decided not to listen and just get on and do what I want.

20:40          The interesting thing is as well, in all fairness to them and I have to say I love them, they're great support and everything else. And they'll always want the best for me, but it's not that they had made sound financial decisions themselves to be giving others financial advice. So that's the thing, you know, they’re parents, they're all protective and thinking about their kids from a different perspective.

Dimitropoulos has been buying properties since the mid 90s and has 13 properties currently in his portfolio. We hear about what has been his worst investing moment throughout all these years.

22:26          I can say a lot of it was before knowledge was out there and people were doing it on their own. I'm not talking about, you know, 50 years ago, I'm talking 10 or 15 years ago, there wasn't that much information out there. So I've made quite a lot of mistakes. I've made some mistakes. For example, I bought an off the plan property in 2010. I wasted a couple of years on that. The lowest moment I must say though there is a happy outcome. But the lowest moment was a few Christmases ago. It would have been three or four years ago. I bought a property in Melbourne and it was on its own title and great little property. Three days before Christmas I go to open up my mail, a letter from a lawyer.

23:25          And I have to say that was right after we had done some renovations on my house here. And I was really low on my cash reserves and I'm always big on having lots of buffers. But it was kind of like a vulnerable moment. I opened my mail. And there's a letter from some lawyers in Melbourne saying that the property that I bought a couple of years before was encroaching on the boundary with the property behind. And they were assessing their options. That's what the letter said, but it was very formally written, you know, the letterhead was some very respectable lawyers from Melbourne. So I'm going to be honest and say I panicked. I was very low on cash. All I could think was that, you know lawyers and in court appearances and, you know, tens of thousands of dollars that I didn't have then. And I started questioning, you know, why do I bother with all of that and stuff like that.

24:47          Well two hours in when I started to like, you know, calm down a little bit. I remembered that when I bought the property, I had also bought title insurance. I've always been, you know, people might think that I'm crazy, but I'm quite risk averse in all of them. And there's always a method to my madness I guess. But one of the things I really believe in is insurance and I had bought title insurance. I've got title insurance for all the properties though that are on their own title, not for apartments, but I forgot about it. It's one of these things, you get another form, you know, when you get there and the paperwork and you sign it, you pay whatever it is and then off you go. I remember having done that, I went back and opened up all my files and sure enough it was there. I called them. And after Christmas they came back to me formally to say I'm most likely covered by the insurance and it's all good. So then I slept again. You know, that Christmas I did not sleep for three or four days.

25:55          I'd be doing the same thing as well. I'd be stressing and thinking, what do you do? Especially on Christmas as well. That's not a very good time to be receiving that.

26:04          The timing was perfect. But it was a good ending and it reinforced my views that just buy the insurances and its tax deductible, buy it and forget it. And you never know if you only need it once and then it's a good day. That's been my view. And that even reinforced it, but it was a pretty low moment, I have to say.

You never know when things like title insurance might come in handy and Dimitropoulos explains how you get it.

26:34          There's two or three organizations. I don't remember the name of it, but if you search it up, you'll find them. It's called title insurance and basically it says that if at the time of purchasing a property that's all on its own title, you're not aware of any illegal encroachments or anything else, then they'll cover you and every generation that comes after you that inherits the property. From memory it costs about 400 or $500. And that's it. It's basically, it's forever insurance. Then I looked into it and I saw that they had claims up to 100,000 and $150,000. And you know, they've got their own lawyers and all sorts of things. So myself going against the big firm in Melbourne is not the same as them going against them in the end.

27:22          I never heard from those lawyers again. And I waited every day to see if they're going to come back to me. And not that I was worried because I knew I'd have the backing of the insurer, but never heard from them again. And I think this is important, I think if anybody listened to this, because in Melbourne there's a 15 year rule that says if an encroachment happened less than 15 years, you're covered, but anything before 15 years, basically it doesn't count. So when I looked into it, it might have been bordering 15 years or maybe 16 or 17 they had built the house that I bought. So it wouldn't have counted anyway. But so if anybody has a similar experience, I'd say don't panic. Look into it. Sometimes lawyers send you letters to scare you and see if you can panic and jump into a remediation and basically, you know, negotiating, give them some money and then move away. It doesn't necessarily mean that they've got grounds to proceed with litigation.

Throughout his many, many years of experience in his property journey, we learn about the moments when he came to the realisation that he was on the right path.

29:24          There's two aha moments for me. If I could share. One was, I was saying before I bought a couple of properties to save tax and I was getting those nice tax returns. Then we bought our house to live in and I had a couple of little kids and they needed a backyard. So for five or six years, nothing happened. In about 2010, I had saved my $60,000 deposit and I was ready to go again. And I convinced my wife who was always skeptical about this, that it's okay to buy another one. So I've got this one bedroom property at Kogarah right next to the hospital there. And we bought it about April or May. And then we settled and was rented already. We went away for our first trip in a while.

30:18          We hadn't gone anywhere in a while. We went to Hawaii for about four weeks. And about September I went back to the real estate agent that was managing it and I said how's it going? And he said, you'd be pleased to know that you bought it for I think it was $335,000. Then it's gone up to $370,000 now and the year was like 2010. So I said, Oh, that's fantastic. So I went away, we spent about $15,000. And then in that time I actually made $30,000. So hold on, there might be something else in property than just saving tax here. So I came back home and I opened a spreadsheet and I said, I'm curious to see how much that property is costing me. So open up a spreadsheet and I'm putting my rent and all the outgoings.

31:04          I even calculated my depreciation and everything else. And it was rented for about $370 a week. So it was immediately positive and positively geared. And I didn't even know. So when I saw at the bottom that I was actually making $500 a year, once I had my tax return. I thought, Oh my God, what's going on here? So the first thing I did was call my wife, have a look at this. And I showed her and I said, we bought this property, we went away, we made $30,000, and it's costing us nothing to hold. Let's do it again. And she looked at the numbers for about a minute. And then she said, okay, let's do it again. And that was the first moment that my wife actually came on the journey with me and both of us saw it in a different light.

31:54          So that was my first aha moment. And of course, what did I do? I went and bought another one about two months later. The second aha moment was one I had to go to Melbourne. And mind you, up to that point, I hadn't used any mortgage brokers. I hadn't used any buyer's agents or anything like that. When I went to Melbourne, I had no choice but to use a buyer's agent. And buying a property on my own was quite hard. I have to go to opens and compete with others and put in bids and all sorts of things. So it wasn't easy. It was time consuming. But when I went to Melbourne I had to use a buyer's agent and I used one and I realised that everything is done for you. You don't have to do anything. You pay a bit of money. But at the end of the day, I was ecstatic with the property and I didn’t have to do anything and to realise that maybe using others is the secret here. That's what I did. So these are the two aha moments. One is there's more to investing than saving tax. And the other one was use others because you get better property and you don't have to lift a finger basically.

We delve into Dimitropoulos’ strategy and the types of properties that he looks for to add to his portfolio. 

00:21          As I was saying before, I'm really risk averse, so my strategy is pretty simple. I love to buy property that's close to transport. I love to buy property where jobs are. And I love To buy as close to the Sydney CBD as possible. So all of my Sydney and Melbourne properties are probably within a 10km radius of the CBD and they're all right next to a train station or a tram station or something like that. And that's one part of the puzzle. The other one give it time basically. So I'm not, you know, a materialistic person. When I buy, I buy forever and I hope I never have to sell, even though I might be forced, there's a couple of my properties and they're not my favourites.

01:11          I might have to let them go at some point, but I bought for life and I've bought close to where the fundamentals are. And let them do their thing. So I bought the properties in Sydney. I let them go through two cycles. I used the equity to go to Melbourne. All of my Sydney properties are positively geared. All of my Melbourne properties are for growth. So I've got apartments in Sydney and I've got townhouses and land and housing in Melbourne. So the Sydney properties, I help them to maintain my Melbourne properties. And that's the secret, buy where the fundamentals are and let them do their thing for me.

Being in property management himself, we learn about whether he manages the property or if he has someone on the ground helping him out.

02:31          I manage the ones in Sydney and I now also manage the ones in Melbourne. So we manage them from here. I've got someone on the ground in Melbourne that holds the keys, but we do everything from here and you know, the world of property management is changing. So I decided to go into property management about five years ago because of so many other people. I wasn't really happy. I thought it's easy and anybody can do it and surely myself, I've got degrees and I've got my masters along the way. And a lot of corporate experience before I thought, how hard can it be? Anybody can do it. But the truth is it's hard. It's hard work but it's changing. And a lot of technology can help. And you can do a lot of things remotely and do a great job if your business is set up to be efficient and all their systems are there. It allows time to do all of those mundane things that really burn property managers out.

03:31          So to answer your question, I manage all of my properties myself. Just before Christmas for example, we had two vacancies, two broken leases in Melbourne within two days of each other. We advertised everything from here and I just had the person on the ground to do one [inaudible] rented and I have to say since I took over, my rents are a lot healthier and a lot better because I can see from here and if, for example, one of them managed to get an extra $50 that the previous property, their local property manager wouldn't support me on. So I advertised from here $50 more and both properties are worth a lot more basically than they were previously rented for from the local property manager.

We find out more about his journey from working for IBM to eventually opening up his own property management business.

04:46          That was until about five years ago. So I was in project management, you know, started as a software developer, then I moved to project management and program management. Then my last job was a very senior role managing tens of millions of dollars of projects and massive teams of hundreds of people. And that was the thing for me that made me think maybe as demand business because a lot of the skills that I had developed around comms and dealing with people and influencing and all my IT background, these are all good skills to have if you start your own business and if it's a property management business. So I did that until about five years ago. And five years ago I wanted to do something for myself for a change because there is no safety in the corporate world.

05:40          And people were getting made redundant left, right, and centre. I did try for a [inaudible] to be honest for myself, but I think if you're good at your job it's a bit, unless you get caught up in some sort of big restructure, if people are keeping you and there's big redundancies in the office because you're good at your job. They need you to continue to do the job. So that's the irony of the corporate world. But I wanted to do something for myself. And there wasn't anything else for me to do there. And I was getting a bit down on my luck and for a couple of years, you know, it was really, I wouldn't say depressed but very close to that. And in those moments, thinking about my portfolio and thinking that I've got to now, like if worst comes to worst, I can probably sell two or three properties and I've got a note and many other people don't have that opportunity. So that kept me going and I was looking to start a business. What do I do? I love real estate. I looked at a couple of things, but I love real estate. So real estate and what suits my personality better. That's property management. So that's how I made the journey. And I started my business then.

07:02          I've been building it now on this side for a couple of years. I started building it on the side about two or three years ago. I couldn't, because I still have all those mortgages so it wasn't possible, but I was able to do it on the side. The first thing I did was find someone that would help me. I looked for the best property managers that I could find and was lucky to find someone that I think, and I'm speaking as I landed here, I think this is fantastic. And she’s loyal, she’s organized, her heart's in the right place and we've been building it together basically since. But I do have lots of dreams and plans to build it up. But I don't, you know, necessarily want to do it for the money or anything like that for me. I just love to, you know, I call it my third child. I want to get to a point where, you know, I’ve built something that I'm proud of and help myself manage my own property. So I want to manage other people's properties just the same.

In terms of his property portfolio, we learn about the different ways he is able to manage it and improve it. 

08:35          I can tell you my rent at the moment. Basically a lot more than I ever got from others. And I'm pushing the envelope. Look, busy, day to day, you never look at these things. But one of the things that I've realised a little while back is that if you don't, as a landlord, that if you don't push the property manager, your property is most likely 10, 20, 30, 50, I've even seen $100 less to where it should be. I think that's the main issue. Generally I can tell you property managers are, I've been reluctant to put the rent up because it's not a lot of money for them. It's a lot of work. Plus it might upset the tenant and the tenant may go or they have to have the hard conversation. So there's a reluctance in the industry to keep up with the rents.

09:24          And as a result, I tell everybody that I know to do a quick search online. Have a look at your similar properties and see what they’re renting for. I had a property come to us that was $100 a week less to other properties. The rent hadn't been put up for weeks. He is a busy executive, never cared to look at anything like that. So identical properties in his building were renting for $720 and his was $620 and he hadn't put it up in five years. So that's real money basically. So that's been left on the table.

When you hire people to work on your property you have to put a lot of trust in them to do the job correctly, Dimitropoulos explains how his company provides better service than other property managers in the market. 

10:36          As a property manager, it's easy to forget. So you've got to build it. You've got to build it into your profit, into your processes. For us, we've got to do inspections every six months and it’s part of our process, we're going to do rent review every six months as well. And I'm not talking about, you know, the formal letters, I'm talking about five properties that are nearby to yours. This is what's happening. It's not that hard, but it keeps everybody on their toes. I want that myself as landlord of my own properties. I open the section and I have a look and see what's happening. And then sometimes you know, you go, okay, it's fine. Or you can see property, you know, the rent moving upwards and you go, okay, well let's just start thinking maybe in six months we'll put it up by five or $10 because if you do it that way, it's not a big deal.

11:29          But if I have to pass up on $100 and the interest is at $25, you know, that's what we've been doing. And the risk every time we'd have to manage that up on that example that I gave, we have to manage the rent increase. We have to give them a call and explain with examples why they're still like $70 less, for example, than another property upstairs. And it's okay to pay $20. But you know, it's hard, but if you're doing 5 or $10 and keep you on your toes every six or four months then it's an easier sell and you keep up with the mark.

Dimitropoulos shares with us why the market in Sydney has become more stagnant in recent times. 

13:07          It's basically over supply. So it's the apartments over supply. That's all over Sydney. With so many apartments, especially in the bigger areas, like, you know, Paramatta or Liverpool, everywhere you see big towers coming up. Rents are stagnating and probably dropping as well. I mean, I've heard of friends going backwards by 10, 20, 30, $40, and I've seen it as well. I've seen rents that went back by $100 somewhere. I mean, you know, people don't see because they look at the averages, so other pockets are fine, other pockets are struggling. If you're in Sydney at the moment, I would say, look after your tenants, you don't want them to go. As Sydney investors, we have to weather the next year or so. So let's be as accommodating as we can. And then, you know, with every cycle you know, we'll come back basically and we'll come back. But for now and just be mindful of it and look after your tenants.

14:37          Canterbury and all of those, all of those are struggling at the moment. And you know, I mean, I've got a property that's coming to us to be managed. It's being completed in April and is on Canterbury Road. It's going to go on the market and I'm going to be competing with probably 50 identical properties. So you know what that's going to do to the rent basically. I mean, the good news is it all gets absorbed. There's tenants out there, but the old days of property managers putting an ad out there and living in it and people come, you know, tenants line up and come begging are gone. So we have to work really, really hard to fill vacancies quickly. And you know, for us I was saying before, I've got an IT background, so I'm really big on stats. So I watch statistics to see views of my art. I save every other property, for example, on the suburb that's competing with those to see what they're doing. Are they putting the rents down? How many opens do they hold a week? So, you know, it's basically a dog fight and unless as a property manager you have worked hard to attempt to sort of dedicate yourself, properties can go vacant for weeks.

16:13          I have to say for Melbourne as well, it's not the same. So Melbourne, I think they have had the downtimes and rents are picking up in Melbourne. So if anyone is listening from Melbourne, they're in a much better position and they can be a little more aggressive with their rents. I had two vacancies in Melbourne and we rented those on the one opening and we had two or three applications, whereas in Sydney, we'll show to 50 people, you know, to 25 people say, and we might get one and if we chase them and drop the rent a bit, so that's the scenario. So just for fairness, it's not everywhere in Sydney. The quality properties always rent and you don't have to do cap walls for them, so that's it.

16:59          That's my advice to investors. When you buy a property, and I made the same mistake before I got into the business, trying to think a little bit about the demographic. And also think about the [inaudible] inhibitors. What are the things that are going to stop the tenant from getting the property? For example, a big thing for me is done by a property that's on the top floor of a building that doesn't have a lift because immediately you cut out all of the older people, anybody that can climb stairs, anybody that's on feet and all of that in a landlord's market, it doesn't matter. But, you know, in a tenant's market, all of those little things make a difference. So quality property that's got certain characteristics. Even at the lowest of times, like Sydney is now all was rent and you always get rents from it.

We dive deeper into property management and discover how he keeps his company competitive.

18:56          I have to say there's not a lot of money to be made for the amount of work that goes in. The value in property management is on the rent roll basically. Because that's an asset that can be resold. So that's got a value. But in terms of the fees that you collect and all of that kind of stuff, especially with the competition that there is in Sydney at the moment and the fees, you know, to compete, you have to drop the fees, especially like myself. I don't have a sales department. All we do is property management. Someone like us that don't have properties coming in from the sales department. To compete, I really need to be, you know, mindful of their fees. And that's okay. I mean, I'm a lean business. I'm a startup, everything's optimised. I don't have a big franchise name. But the way that the industry compensates is in quality basically. So fees drop and then quality drops and expectations drop. So there isn't a minimum I should say, but I know some people have like 5000 rental properties. I mean that's worth millions and someone that owns that makes a lot of money but that's not the case with me I guess.

21:11          And then I have to say the property managers and I know a lot of people are angry with the property managers and all of that, but I can tell you now that I'm in the industry, it's a lot of hard work. I can also say we'll reveal everything, property managers don't get paid that much. So the basic salary is probably about 60,000 to $80,000 a year. But if you could think of all the work that they do and always on their toes and running around. And to be honest, every time you've got the word management or manager in your title, it's all about dealing with problems. That's what that means. Managing problems. It doesn't mean managing the wins, other people get the wins, you just manage the problems. So the property managers themselves don't get paid very well. The bigger the rent roll, the more money I guess the business makes, but not necessarily the property managers.

Sometimes it is not until you have been in both positions that you can fully understand the work that goes into a certain job.

22:44          That's what I would say, as a landlord I never saw that. Now that I also manage properties, I can see it so I can see both sides of the coin. And if you want to have a fair business where you treat everybody with respect and you're fair to the tenants and the landlords, that's the little triangle, property manager, landlord and tenant. If that works in a partnership, then that's the best outcome. Because things will go wrong. But if there's understanding then it works well and that's kind of the philosophy that I've brought in. As a landlord I’ve always looked out for my tenants because they pay my mortgage and then if I can help them I will. I’m appreciative of them being there and all of that. And in all fairness, a lot of landlords are like that. So the professional landlords don't really care, they fix things, they’re understanding and they look after tenants and then the tenants are expected to respect the property and pay it back basically. So that's the best scenario, but it doesn't happen everywhere.

We hear about what his biggest motivation was for jumping into the property industry and investing.

24:09          For me, and I'm not going to talk about the early years, which was all about saving tax. That was silly, but the minute that I understood what it is to be an investor, it was all about safety. When I'm 65 or 70, they're the last 40 years of my life. It's not about, you know, the middle part. I've always assumed it's going to be my accumulation, but I've always wanted to have safety from 60 onwards. I want to be 65 when I retire, I want to have a good life then and then also help my kids as well. So that was the motivation for me. I can't say that, you know, I was thinking that's what I was thinking every day because you get into a frenzy kind of, you know, when I was buying properties, I went from like one every two or three years.

25:01          I need to buy a couple at the same time. Then it became this obsession of buying more. And it's not that I've done the numbers that are needed, you know, 11 or whatever, but I knew the more I could get my hands on, the better we'll be in the long run. So that was my mindset for a long time. So I was completely obsessed with buying property. And what the second aha moment that I talked about was I found a great buyer's agent. And you know, in my view, finding a good buyer's agent is like striking gold, basically equivalent to that. And not only because they find new quality property, but also because they find you quality people, like they come with quality people like the mortgage broker. So up to that stage I was going to the bank and dealing with the bank directly.

25:53          And they told me there's no way we can give you any more money. That's it. No more playing these games. So I was stuck, but he was able to put me in contact with a great mortgage broker. And then he unlocked the potential basically. So it was that kind of thing. So finding the right people is absolutely imperative and then trust them, let them do their thing, don't interfere. Because this is another lesson that I would like to share as well. So the first property I used the buyer's agent  I found off the internet and they didn't buy me a good property. The property wasn't right. And I can't really blame them.

26:41          I think the issue is that I came from Sydney with a mindset of what the property needs to look like and Melbourne is different, it's a different beast. But they bought me the property that I wanted and that was wrong. But that was the lesson for me: find the right expert and let them do their thing. Don't interfere. They're in the business every day. They know more than you. And even me, I mean, property management. And you think I can manage a property, I can make decisions? No, I can't cause I'm not out there everyday looking at property, looking at suburbs, looking at strengths. Looking at how the whole market is going. 

Whether he had any mentors throughout his journey or if there were other resources that he leaned on, it came back to the classics.

27:49          To be honest, I didn't, and for a long time I was just doing it on my own. I kind of knew it was the right thing, but I had my doubts. Then I started, you know, one day I was in a bookshop and I found some of Mike Yardney’s books. And I thought they were fascinating because they did two things for me. One is they confirmed that I'm not crazy. The second thing that it did is showed me what it all meant and how you would transition from accumulation into getting out of it. What it all means, you know, what does accumulating wealth mean. So I read his books quite religiously over the years and a few others as well, but Mike Yardney’s books stuck in me and I was actually very fortunate to meet him in person last year and it was a great moment.

28:45          The other thing is through his books as well, I also went into reading Rich Dad, Poor Dad. And that was an amazing book as well for me. And that was part of the catalyst where I decided that I needed to start my business because of necessity in the corporate world a few years ago. I can't say that I had mentors per se. But it all clicked. It all came and I understood. And then spending time online and reading and stuff like that, that sort of made it all prove that I was on the right track, I guess.

Dimitropoulos shares with us the best piece of advice that he has ever received.

29:41          The best advice would be what I was saying before, don't do it alone. So my kids are, my daughter's 18 now, my son's 16, so  I'm going to reverse back into being a 16 and 18 year old and trying to sort of relive those early days through them. And my advice through my own experiences and listening to others is to not do it alone because there's only, you know, unless you're in the business, you don't know what you're doing basically. And unless you can devote a time for research, I know some people are, you know, in their research and demographic and stats and ABS and whatever else, but if you're a busy professional, like I was, find the right people and use them, just let them do their thing. And you'll probably find that in the long run the properties that you buy are of better quality.

Some of the most successful people in the world are habitual by nature and live by routine. We learn about some of the habits that have helped him along the way.

31:35          I am relentless. I work probably from the minute that I wake up in the morning until one o'clock every night. So I don't stop and I’m relentless and I wake up in the morning with a smile on my face. So you have to be relentless at what you do. If you work hard enough, I think it will come to you. I don't think it has to do with some amazing gifts or whatever. It's just stick to the fundamentals and work hard and it will happen for you. So, I wake up and I think about property and go to sleep and I think the same. My poor wife, who by the way, you know, has nothing to do with property other than listening to me every day. I see her as my sounding board. I talk about it all the time. So you’ve got to be obsessed about it.

32:40          So it's like I always constantly talk about it. I'm in church on a Sunday morning and I get a text from my buyer's agent in Melbourne. It's Melbourne Cup weekend and an agent organised an auction on that Sunday. Nobody turned up and said to me, you know, the property that we saw for a good price, they're desperate. The auction just happened and nobody turned up. So do you want it? And I'm texting, you know, hiding my phone in church because I wanted to finish up the deal. So, you know that kind of obsession. So whenever the opportunity is just jump at it basically.

33:44          Nothing's given to you in this world. I mean, that's what I've found. And it's only through hard work. There is no silver bullet. I haven't seen anybody and I'm speaking to a lot of investors. And even the most successful ones are, unless you are unrelenting, as in you work hard, it doesn't happen for you. There is no magic bullet for everyone. And if there is and anybody's promising you that, then I'd say run away because that doesn't exist.

There are many things we wish we could go back and tell our younger selves, we find out what Dimitropoulos would say to his past self.

34:25          10 years ago I bought that off the plan property. That was 2010. I would have said don’t buy that. Buy two or three, between 2010 and 2012, I suppose to waste those two golden years. But you know, in general I would've said just go harder. Be more ambitious. Long term you'll be fine. You might get the lows at the end of the cycle, but forget about that. Just keep on as soon as you can and buy as many as you can and then they'll be right in the long term. And that's what I would have said. I've wasted that couple of years. I should’ve bought more then.

We find out about what Dimitropoulos is looking forward to achieving in the near future. 

35:22          To be honest, I'm about to relive this whole thing with my kids. So I'm one of those dads, that's you know, I said before, it's all about family. So my kids, I've been brainwashing them slowly and steadily for 20 years. They both have little deposits. They both have two jobs. I've got a girl and a boy and my girl's 19, and my son is about to turn 17. They both have money on the side. They really want the money and about two to three years they'll be buying their first property and they'll start the journey again. But that's one aspect. The other aspect of course is my business. I’m absolutely proud about building it up from scratch and and all of that and just just looking after my properties through it, but also looking after other people's properties. The next five years will probably be building up my business and also help my kids start on the right foot as well.

36:24 Last question I have for you, and this is to really wrap up the whole episode is how much of your success is duty or skill intelligence and how work and how much of it is because of luck?

36:39          There's no such thing as luck. And I think it's to do with what I was saying before. I think I was lucky enough for a few things to click in the old days and to jump at the opportunities that are hard and to be relentless about it for a period of 15 years. I think that's what it was. It isn't anything to do with super intelligence or some silver bullets that I've got. Stick to the fundamentals and be patient and I think good things will come.

Thank you to Chris Dimitropoulos, our guest on this episode of Property Investory. If you want to hear his full story, simply visit PropertyInvestory.com