Peter Diamantidis - Where You’re Going Wrong: The Agent’s Perspective on Property
On this episode of Property Investory we talk to Peter Diamantidis: One of Australia’s top-ranking real estate agents and the proud owner of over 20 investment properties. He tells us why he bought his first home at just 18 and how he’s still in the game nearly two decades later. You’ll learn techniques to find positively-geared properties before they even hit the market and where to find safe tenants. Plus, the number one reason you’re limiting you’re development profits.
1.08 | Early Starts
4.16 | Buying…With or Without You
6.36 | Playing the Long Game
12.06 | 2 Birds 1 Stone
13.45 | Unexpected Opportunities
18.36 | All Shapes and Sizes
24.26 | Structurally Sound
27.30 | Old Dog, New Tricks
31.55 | You Can’t Be Everywhere
35.15 | Advice>Advertising
38.47 | Living, Breathing, Helping
41.48 | Get In Touch
Resources and Links:
[5:57] My first ever job. Never worked at McDonald's, KFC, nowhere at all, just straight from Year 10 to real estate.
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 hear from award-winning real estate agent and developer Peter Diamontidis. He’ll share with us how he’s grown a multi-million dollar portfolio from scratch to holding over 22 properties in just over a decade, and he’ll tell us how to avoid the biggest mistakes in purchasing and selling property that he sees every day!
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The working day starts early for many of us. For Diamantidis, it’s no different.
[0:48} I'm currently a real estate agent—for the last 15 years. I got into property, well, into real estate 16 years ago at the age of 15. Now [a]t 31, my everyday job is to basically list and sell property.
[1:37] So basically, every day, I get up at 4:30 in the morning. Five o'clock at the gym. At work by 8 PM. My job revolves around listing properties, selling properties, talking to clients, developers, investors, first-time buyers or anything basically to do with property. I'm doing that every day—basically seven days a week.
We’ve all got to start somewhere, and for Diamantidis, who is one of Australia’s leading agents, shares his humble beginnings.
[2:15] When I look at when I was 15 years of age, I started an administration job, basically just doing paperwork, filing, cleaning bins, anything that I could do just to get my foot in the door. Then I gradually improved, got into property management, showing rental properties, got a better car licence, did a little bit of strata management, and now in the last five [or] seven years, or close to eight years, have been in sales.
Choosing a career is a huge decision. Most people try lots of different roles before digging in. Diamantidis was quite the opposite.
[4:54] I was brought up in an area called Tregear, which is a suburb in Mount Druitt—Mount Druitt is in Western Sydney.
[5:09] Yep, went to school. So, [for] primary school, [I] went to a public school called Tregear Public. And [for] high school, I went to Whalan High School.
[5;24] So basically, I left in Year 10. Well, in Year 10, I had to do actual work experience. So I did work experience as a plumber—I wanted to become a plumber. I nearly had an apprenticeship with Garden Island but still at school. Then I had to do experience in a work office. So I said let's try real estate. So I had no intention to work in real estate, but I had to do something for a week. I worked there for a week and then got offered a part-time job. [5:57] My first ever job. Never worked at McDonald's, KFC, nowhere at all. Just straight from Year 10 to real estate.
[6:13] I never studied. I wasn't good at books. I'm still not good at reading and writing and everything else. It was more that I'll just use my hands and move forward.
Diamantidis talks about what he would do if he had the chance to turn back time.
[6:47] In my time, now in say, 16 years, more lately, in the last you know, three or four years, I've been approached by a lot of franchises. Open up your own business. And yeah, [I’ve] been headhunted. It's all changed in the last couple of years. I've been in the top, last year, actually, in the top 52 agents in Australia-wide.
And yeah, just up a number of sales and things like that. So with the network I work with now, we've been consistently No. 1 or No. 2 in the past how many years. So it's been a stable job. I love what I do. I don't look at my time and say, ‘Well, at five o'clock, let's knock off’. It's you know, I come in when I want to, I leave when I want to. It's a very easy job.
[7:45] If I'm a doctor in St Mary's, and I'm going to go to work in North Sydney, your clientele is not going to follow you. And that's fine. You've got to start new. But you know, of course, I could be still here where I work in an area called St Mary's and say I could open up across the road, but I don't have that motivation to have my own office.
[8:14] I look at it and go, ‘Well, my investment properties or my investment journey is a full-time job, pretty much’. So that's why I look at it. That's my own business. And where I work is somebody else's business, but I look after it like it's my own.
Some people are born with a passion and the support to carry it out, but Diamantidis says he wasn’t one of them.
[8:49] At 15, I had no interest. [At] 16, yeah, looking into it. My background—I had a mother, didn't have a father, and I had two grandparents. That's all I had growing up. No brothers, no sisters. So because we lived in an area which I would say—and it's no disrespect to the area—is a poor area of Sydney.
My mother only had one home where she was paying off. My grandfather had a home [which] he paid off many years ago. But they were always in the belief: To buy a house, pay it off and then you buy the next home. I started realising at a very young age, at 17, [at] 18, or even before 18, to do that, it's going to take a long period of time to basically buy a second or third or fourth home, which I wasn't willing to wait.
So, influences I would say, not in a negative way, but they weren't all for buying multiple properties. They want one property, pay it off and then go again.
Buying…With or Without You
But the journey didn’t end there.
[10:31] Basically carrying on, starting in real estate at the age of 15, I then started looking into property more around when I was probably 17 years of age. Because the area that I lived in, there [were] a lot of investors, a lot of landlords. So, I was actually watching and seeing what they are doing and learning from them. So, before I turned 18, I was very committed—I wanted to buy a property.
So, I went down to the Commonwealth Bank before the age of 18 and they basically said that ‘We can't process a loan. You're not 18, but we can look at figures and work it out from there’. So, I wasn't happy on the way I was treated from the Commonwealth Bank. So, I went to a mortgage broker, sat down, and we decided that on the day I'm 18, we want to process a loan and buy property.
So, I found the property before I was 18— a week before. It was basically a two bedroom apartment in Mount Druitt and I actually put [in] an offering and got it accepted on my 18th birthday. At 9 AM, I went into the agent's office and signed that contract, on a cooling off period. So, that was my first purchase, the two-bedroom unit. I think it was at the time around $167,000, it was in an area in Mt Druitt and that was my first ever purchase.
An investors confidence is always tested after money is put down. Despite his trust in the process, Diamantidis isn’t immune to fear.
[12:12] I was very nervous, because— I'm going to be honest—when I started at the age of 15 working, I was earning $198 a week. I wasn't earning big money. So, even at the age of 18, I would have been earning probably less than maybe $450 [or] $500 a week. So, back then, it was a lot harder. So I saved every dollar, and every dollar made a difference.
So, there's a couple of things before I was 18 that I had to sacrifice. You know, I probably couldn't go out to the movies as often or do things where maybe other teenagers did because I really wanted to get into property. So yeah, it was hard. I was scared. But I said to myself, what basically pulled me through that period, where I'd say it's make or break, is looking at the rental return.
The rental return—making sure that I had a tenant in there, making sure the property was clean and tidy. If I had a tenant in there who I believe was paying a rent, even if they didn't pay for how many weeks at the time of the repayments, it would be fine. So, that got me over the loan.
Playing The Long Game
So why invest in property at all?
[13:31] At the time, I didn't know anything else. I had no idea about shares. I had no idea about—even people telling me now about buying vending machines and ATMs and getting rent back from things and holiday homes. I had no idea. Under the age of 18, I just had no idea at all. So, people that worked in real estate in that period of time, I didn't know much.
But I knew that buying a property, eventually something might increase, or, at worst— because the way I looked at it was in 20 years or 25 years when that loan is paid off, I thought of that to be as, like my super—something that's paid off. I'll be getting a rent return on it.
And that's the way I looked at property at an early age. I looked at it as my retirement fund. Maybe I'd retire at the age of say 40, 45 or 50. I'll say 50 now, but back then, maybe 40, I'd retire. But the way I'm still going, that's the main reason why I wanted to get into property at a very early age.
From 18, Diamantidis hasn’t stopped.
[14:56] The maximum that I basically went up to was 22 properties at the time. So, I went basically all the way up to 22. I'm now down to 15 actual existing properties and I'm currently building 10 as we speak. So, I've now moved a little bit from buying your bread and butter stuff: your apartments, your houses, your townhouses, to more developing loan land, building duplexes, building single-storey homes and doing townhouses.
I'm doing one of my biggest projects at the moment, which is seven townhouses, which are 250 metres to the beach, which is my biggest ever project. So, I'm more moving on to that stage. But in saying that, I've still kept a lot of my properties which I bought at my early 20s. Of course, I don't own the property that I bought on my 18th birthday, but I have bought other properties in that time which I've kept, which I look at it as my bread and butter stuff. When I retire, I'm hoping to still own the loan rights and just be a passive income.
For every success story, there are several teachable moments. Diamantidis learnt to choose the right tenants the hard way.
[17:16] This would have been my second or third property. I bought a two-bedroom townhouse. And at the time, somebody approached me and said, ‘I've got a tenant, she's doing it pretty hard, but she's working and everything else’. Okay, all right, I'll give it a go. And I had landlord insurance of course. But it [was] a complete nightmare.
From the moment she moved in she was causing a nuisance to neighbours and everyone else. She got me off guard with a lot of my other neighbours in the area, because they knew who I was. Basically trashed the property. It cost, probably, nearly just over $20,000, $25,000 in insurance claims.
And you have to remember, if that happened to me now, it's ‘Okay, fair enough’. But that happened to me when I was under the age of 20—when I wasn't earning a lot of money and I was relying on that rent. So, that was stressful. So, now I've learnt a lesson; you've got a real estate agent for a certain reason.
Of course, you know, it’s a good experience. You don't have to double-check the application and things like that, but be careful on who you put in a property. It doesn't matter how bad your property is. It doesn't matter how good your property is. Because it's a nightmare in trying to get them out repairing it, and it will just cost you a lot of money.
Diamantidis says, despite its challenges, his property journey has brought him far more joy than money.
[19:35] If I can say, it’s a bit about property investing, and I'll go into it. But basically, it’s working as a real estate agent where I've actually met my wife. At the time, working where I am, I had a property on the market, which I sold to a young lady. And [I] later fell in love with her, married. Now, she helps me—she runs my portfolio, our portfolio. She manages all the repairs, manages all the paperwork.
So, it's not like really something that I've thought. But I've met her. We're married. We've got children. And she's now looking after our portfolio full-time. So, it's a bit of a, yeah, if I didn't sell on that property, if she didn't view that property, I would have never met her and never went past that stage. I can say comfortably since I have met her, our portfolio has more than doubled within a five-year period.
[18:52] Out of all my property purchases, not one of them have gone down in value. And most of them have probably gone up over $100,000 each and some of them have probably doubled or tripled.
2 Birds 1 Stone
However, it takes work and thorough research is one of the keys to unlocking property profits.
[21:16] Probably less than three years ago, I bought a block of land in an area called Riverstone. Now, it was a corner block. My intentions were to basically just build a single-storey home with a granny flat at the back. That was the idea—because that's all you can fit on the block of land. So, at the time, I went through all the motions for all the approvals.
At the time—I've got a good friend that also bought a block similar, probably two years before and he advised ‘You know, Peter, you can actually build two houses on there, not one’. I said to him, ‘No, I've checked with different architects and everything else’. He said, ‘No, I've got an architect. He promised me that we can get two on there’.
So, alarm bells are ringing, [I’m] thinking, ‘Hey, these people are about to pour the slab for the property because I've got it all approved, and this guy's telling me that I can have two houses on there’. So, I put the brakes on, spoke to this architect— basically, six months later, I had an approval for two homes and am now building two houses rather than one.
[23:54] So, from one title, which I was expecting, to two Torrens title two-storey homes.
[22:27] I've worked out the sums. I've profited an extra $320,000 rather than—and again… And this is now another lesson in. [22:39] I was looking at Council website. I was speaking to architects in the area which were very busy at the time. But somebody that was very eager wanted business said, ‘I can test this. I can speak to council. I can run this. We've got different storeys which we can actually go, and we can get this approved’. And since then, I made a precedent in that area, and a lot of other people have followed on.
Of course, buying and building are one thing. What does he do with the property after buying it?
[24:24] The way I look at it, if you're selling a property, you're going to be paying tax. Why not keep that property? You know, in the future‚ three years, five years, 10 years, it can be worth more. And especially that property which I actually purchased just to have the house and granny flat—that gives me dual income. I'm now going to get dual income plus a little bit more out of it. So, it's going to be actually positive-geared, so, why would you sell a property, a brand new estate, where you've got good depreciation? Why would you sell it just to pay some capital gains [tax]? Keep it.
Making smart investment decisions is always hard, especially when not everyone gives their support.
[0:11B] I had a buyer's agent who I knew as a friend. He actually contacted me and said to me, ‘Peter, you can buy an 850 square-metre block of land with a three-bedroom brick veneer house and return around $190 a week’. I said, ‘Where?’ And he goes, ‘In Moree’. I’d never even heard of it. So, I started doing some research, and I'm thinking a lot of negative stuff. And I said, ‘It's $60,000’. I said, ‘I can even purchase it on my credit card. You know, it’s awesome’.
[3:08B] I think at the time they were advertising it. But when I saw it online, it was in Moree but they had it through a Cabramatta agent. So, I think I was assuming that it was maybe an Asian investor who maybe didn't speak much English—I don't know. It was really weird. So I just did a building a patent, because the alarm bells started ringing. [3:34B] I started speaking to a lot of people.
I know it was still only $60,000, but it still concerned me. I didn't want to have a liability up there, I didn't want any issues. So, we checked everything out, of course the house was—it's not a brand new home. But the house would actually cost more than $60,000 to rebuild. And it was brick, it wasn't even a fibro [or] asbestos home.
Diamantidis says when it comes to making the final call, investing is all about balancing risk and reward.
[0:42B] So, I actually bought the property for $60,000. A lot of people were against me in buying in the area. And I thought it's not the end of the world. I purchased it, owned it. It's gone up in value. It’s probably gone up another $45,000. So, it's nearly doubled in that short period of time. But my return now is $240 a week on a $60,000 purchase. So, the point of the story is nobody wanted this because they read so many reviews and it was at the end of the world stuff.
But I looked at it and go, ‘At $60,000, where can you go wrong?’ Even if it doesn't increase in value—like what people said to me, ‘It's never going to increase in 20 years’. In 20 years time, say that I still had a mortgage on and it went down to like $10,000, I would be having a positive income from Day One. So it's like saying that you just got yourself a pay increase at work.
[1:50B] [1:50] So that's the way I looked at it. Now, if you said to me, ‘Have I seen the property?’ No. Have I been up to Moree? No. Why? Because I've got a good property manager. I've got good maintenance people; they look after it. And that's pretty much it. And funny enough, one person actually said to me, ‘You know, over there, they burn houses in that area’. And I said, ‘Well my house is insured for $220,000. It's a lot more than I paid for it’. So if they're gonna burn it down, I get that I’ll be covered under my insurance.”
Coming up after the break, we hear about some of the habits that contribute to Diamantidis’ property wealth…
[0:24] You're gonna actually laugh and people may not believe me. I've never read a book in my life. I've never read a book.
As well as the strategy that breeds consistency…
[6:37] Properties to me were like trees—or are like seeds. You plant the seed, the tree grows. Eventually, you might cut the tree down and then replant it, or you just keep them.
And that’s next. I’m Tyrone Shum and you’re listening to Property Investory.
All Shapes and Sizes
Diamantidis says there is no prototype for a successful investor, because he doesn’t fit the mould.
[0:24] You're gonna actually laugh and people may not believe me. I've never read a book in my life. I've never read a book. I've never done it. It’s just— I always used to subscribe to API and Prime Property Magazine, I used to read magazines, not books. So, it's just that because of the job I've been in, I've learned a lot of things just by watching and observing other people and the way they've done things.
And I think in my journey I've been very fortunate that I've met the right mortgage broker, the right accountant, the right people around me to create a backbone. Because the backbone is very, very important moving forward.
That business backbone can be just as valuable as knowledge itself.
[1:10] It's not about just buying the right property. But if you don't have that mortgage broker that's going to look after you, that's going to put the hours in and basically manage your portfolio the way you're managing it, you're never going to move forward to create a bigger portfolio. You know, I've seen so many people over years that have used the wrong broker or the wrong accountant and wrong advice. So from early on, I wanted the structure to be correct.
[2:09] So with a broker, if you're getting into property investing, you've got to remember sometimes the broker is looking after their own pockets. So they'll put you through to a bank, which is maybe a higher commission for their back pocket. They'll move around. They'll go from bank to bank. You get that in every industry. But this person, he basically looked after me at a very early age, looked at my portfolio, told me which bank to go with and who not to go with. He [rang] me when there were good deals on fixed rates.
He told me when to move from one bank to the other and then when—like in the last five years or four years now I've been building property, he put me through to the right people. So, not going through a bank for example— say they'd be going through CBA bank and then realising ‘Oh, wait, we can't get a construction loan there’. So, looking through from step one, to the last step, step 10, and following it right through.
Spending time with his trusted broker, Diamantidis has picked up some borrowing strategies himself.
[3:24] The way I've got it with the bank—you know, of course with investment properties, a lot of people believe in just doing interest-only. I believed from a very early onset that I want principal and interest because I want to basically pay the properties off. And I know at the time, my mortgage broker said, ‘Oh, that might not not be a good idea. You might cap yourself out’. And if I get to that stage, then I'll revert it back to interest-only.
However, [it's] very important that my goal set at the time was to own the property outright. I don't want a debt over them. So he told me in-between there to structure it—put it in my name, put it in my wife's name, put in a company name. Just yeah—certain properties go to certain people. At the end of the day, when you're married and everything, it doesn't really make a big difference. You've got to pay tax anyway. But it just helped me move forward from owning one property to 21 or 22 properties at the end.
But the plans he’s had to build property wealth have largely stayed the same.
[4:40] I could say in one year that I would have purchased a property. But then a year later, I didn't purchase anything. So, it was just—I believe in not rushing to buy an investment property.
Investment property—it means, in my world, means that it has to be a good buy. It needs to be under market value. It needs to have something saying, ‘Hi, I'm an investment property, buy me’. I'm not just going to buy a property for no reason. So sometimes, you can get lucky and you might get three in a row. Then there's other times where it might take you two or three years to find the second or third property in your portfolio or your property portfolio journey. So, yeah, as I said, it can be busy one year with seven or eight properties and the next year, nothing for a couple of years.
[5:51] And my mindset was, at that time, when I was, say between 18 and 22 [or] 23, was to buy property which nearly paid for themselves. Because my mindset was ‘If the rent is nearly paying for the mortgage right now, I would only have to pay for the outgoing, for the property. And in 25 years or 20 years, I will own this property outright’. So, I tried to collect as many properties which were nearly positively geared or neutral. Or at the end of it all, buy properties where I could create dual income to make them positive.
That was my mindset, originally, when I started in property investing. I believe that if I could own a property—properties to me were like trees—or are like seeds You plant the seed, the tree grows. Eventually you might cut the tree down and then replant it, or you just keep them.
Old Dog, New Tricks
However, Diamantidis says nothing is beyond improvement, including his own procedures.
[6:59] Well, I wanted to get into development. So that's what motivates me right now— it’s just development [and] learning the process. So I'll explain it really quickly on how I actually started: My first ever property that I built was a single-storey home. It was a block of land. And moving back to my mortgage broker—he actually said to me to buy this block. He found that for me, so I didn't actually find it.
He said to me, ‘Peter, it's a corner block. You know, you can actually build a house. Build a garage at the back, and build a granny flat on the top, and you'll get dual income’. So I bought that property and that was my first ever, you know—I could call it like a ‘house and land package’. And that I actually did [buy it]. And I didn't believe in it. I believed in buying old rundown units, old rundown houses, keeping them, renting them out, and I never believed in buying that.
[7:56] So my mindset then was changed in looking at the newest sites which are getting built in southwest Sydney, northwest Sydney, anywhere where I could basically buy a property and turn it into a dual income or actually buy a house and get a good return on it. So the reason why I had to sell some of my property that I bought at a very young age is [that] they didn't cost me anything.
But with the bank changing the goalposts, I did see that it's going to be harder to gain loans. So basically reducing or disposing of say three existing properties, which might have been 30 or 40 years old. I've now brought in maybe four or five which are, you know, either near positively geared or neutral. And they're brand new, which are now giving me a higher depreciation. So that's the main reason why I had to sell a couple of those properties.
I don't like selling my properties. I get very emotional. And I tell people don't get emotional in property. So don't buy your first property and try to make it into a palace or overcapitalise. But yeah, I still don't like selling property. I can sell it every day to other people, but I don’t like selling my own property.
In the end, being willing to try new things has proved a game changer for Diamantidis. His newest developments are quite literally paying off.
[9:53] After starting to build a couple of those single-storey homes, double-storey houses and granny flats, I've now moved into buying a block of land and building two on there, or three on there. So, my latest project which I'm actually doing is I bought a block of land with around 1,200 square metres. I'm building seven, as we speak. Building seven…seven townhouses. Those seven townhouses, I'm not keeping. So, this is my first project which I'm actually selling completely and not keeping.
So, basically, I bought the land, got it approved and pre-sold seven townhouses. With those funds, I'll then again look at buying another development similar, but then potentially keeping a couple of new properties.
[10:51] Well, at the time, I looked at it and I saw the process was nearly the same. So, same thing. [10:59] You buy the land, you pay your stamp duty, you get your DA—it’s the same process. But the only difference was the time frame. The only difference I worked out was probably an extra six to eight months, which will take you maybe on construction time, rather than building a single-storey home. So, I was lucky enough when, because I sold those couple of properties, I had more funds in my back pocket to actually put towards the bigger development.
So I went for something bigger. I said, ‘Why would I make, I don’t know, say 100% profit, where I can make 500% profit?’ So I'm doing the same process, but I'm speeding it up. So rather than doing it once, I'm doing it seven times in that same period of time.
[12:35] Yeah, so basically, at the moment, I've got 15 existing properties, and I've got 10 being built. Now, out of the 10 being built, seven have been of course pre-sold, so I will not own them. But the rest of them, I'm keeping. So at the moment, I think the portfolio—not including anything that is being built—is just under $12 million.
You Can’t Be Everywhere
Living and breathing property has helped Diamantidis become an expert. However, he says even he can’t be an expert everywhere and you shouldn’t try to be.
[15:40] Because I love property so much, the one secret that I do is firstly— well, let’s step back for one bit. Firstly, you need to target an area. You're going to know an area. You're going to target an area where you may not know but you're gonna start to know it. You're going to start looking at property and know what they're selling for.
But every night, I actually use realestate.com.au. I focus on certain areas which I'm interested in. And I look every night at what property is sold or what properties have come onto the market. And that educates me. Now, I know I work in real estate. But in these areas, I'm nowhere near, and I don't know nothing about them. But I will probably continue that for maybe three months, four months, maybe a year until I'm happy to buy in that area. It basically fills my mind up on what's selling? What's on the market? How long are they staying on the market? It's like I'm being like a little bit of a researcher, and then I commit myself to that area.
[14:29] The only states that I've ever purchased in have been New South Wales and Queensland. Now, it doesn't mean that…there's nothing wrong with those other states. I just think that because I live in Sydney, I believe to buy in Sydney. Now, one of the projects that I'm doing is down in Kiama. Now, I don't live next door to it, so I don't go down there that often. But Queensland and New South Wales is where I'm focused on the most.
In the last two years or 24 months, I've only purchased in New South Wales. I haven't purchased though—well again, when we go back to how many properties in one year, I bought I think four properties in Queensland within five months. So I went with a big splurge and then I haven't bought anything else in Queensland now for a number of years.
Even the best tools money can buy don’t come close to local knowledge.
[16:48] It is what it is. I live and breathe real estate. But it’s coming down to, you know— you just don't want to just buy a property and not know anything about the area. Get time, go there, have a look at it, speak to always other agents. So even if you're buying a property from Ray White and you've got Raine and Horne across the road, give Raine and Horne a call. Speak to somebody there. You might meet somebody nice, and they might give you some advice about the area or about that actual property.
Because, a lot of investors which I've met in my journey, when they've come to me and [they say], ‘I've got this, I've got this. I wish I never bought that’, it's because somebody has told them to buy something and they just bought it and relied on somebody else. Go out there, spend an hour, spend two hours, a year, how long it takes. Go out there [and] know the area before you buy in that area.
[17:48] Don't just rely on Google and everything else. Rely on that at first to do your assumptions of the area. But go out there and actually see it for yourself, feel it, then proceed. I'm not saying, you know, go out there, you…like I've done in the past where I've bought properties [or] sites, unseen and I've viewed them after they've settled. But I've known a lot about the area and I've visited the area before I actually did that.
So, if Diamantidis doesn’t read books, how does he learn new skills?
[19:07] Forums are actually gold. The reason is no one's getting paid to write anything on there. Nobody's advertising on there. It's basically other investors, like yourself, or like anybody looking at buying property, talking about their experiences. And that’s very important because you can learn a lot more from that rather than just reading a book about one person. You can actually read a book, or [rather] read a forum about 30 or 40 people in one night because they're actually telling you about their experience.
Plus, listening to the wisdom and experience of others.
[20:37] Probably…the best advice that I've received…you know what it is, somebody told me—and I’ll try to remember who it was—I think it was an investor. Probably many years ago. So at the time it was probably a good, maybe, nine years ago…probably, seven or eight years ago, I had somebody telling me about a property that I should have bought for a couple of thousand dollars. He turned around, it was just something quick, and he said, ‘What's $3,000 in 10 or 15 years?’, and it just clicked to me. It was like one of those moments where I go ‘$3,000, why would I not pay that? What's $3,000 over a 10-year term?’
[21:22] So, what he meant by that is— I said to him that I didn't want to pay any more for that property because the one next door sold for $500,000. I'm not going to pay $505,000. But technically, the way I should have looked at it was why wouldn't I? Because in 5 [or] 10 years, [or even] 15 years, I'm not buying to make a profit immediately. I'm playing the long game.
So that's one bit of advice which [I’ve] always kept in my mind. You can always haggle to get the best deal, but don't lose the deal over a couple of thousand dollars, even $10,000. Because if you really think it's a good deal, just buy it on your first instinct, not your second instinct.
[22:25] I've been crying. Look at it, I’m crying now. It’s funny. Some of the properties in the area where I service, I look past and go ‘Yep, $130,000’. And there's some of them, the moments that stick into your mind— when actually, I'll give you a quick story.
So, I went to an auction. It was a two-bedroom apartment. We're bidding. I was the highest bidder. The auctioneer comes over to me [and he says], ‘I'm going to pass it in, but we're very close’. It was $4,000. It was. I even remember the agent’s name: Ben. And he came to me and shook my hand and said congratulations. I said, ‘No, I'm not paying that; this is my final offer’. He says, ‘Peter, I can't do anything. The banks won't reduce the mortgagee sale’. And I didn't buy the property. I didn’t buy the property over a couple of thousand dollars. And within two years or say even three, it doubled. So imagine doing that two or three times.
So again, after this person—I can't even remember who it was— when they told me that little bit of story, ‘What's a couple of thousand dollars now, when looking into the future?’ Trust me, it makes a big, big difference to purchase that property. First instinct is to buy it, second instinct then think about it.
Living, Breathing, Helping
In a world of real-estate apps and internet banking, Diamantidis thinks the human element of investing is often overlooked.
[25:15] Two words: social butterfly. When you buy a property or if you're viewing property— now because I'm a real estate agent, I know ways to get under somebody's skin. So I try not to get under somebody's skin. So I try to keep relationship doors open always. So, whoever I meet, if it's a real estate agent, if it's a solicitor, if it's a mortgage broker, I try to keep the doors open. Because I believe one day something will come back in return.
I'm actually looking on the screen right now, my portfolio, and I'm going through them thinking, ‘How did I buy each of those properties?’ And not all of them were on realestate.com.au. The majority were, but some of them were off-market purchases where I subscribed to a property, I missed out on it, the agent called me and I bought it.
[26:08] Because I basically said, ‘Here's my 10% deposit. I'm not mucking around’.
You’ve got to remember real estate agents in any type of market, the thing that they are worried about is the property will, if it's not up for auction, or if it's a private treaty, that the property will not proceed. In the cooling-off period, you know, you'll rescind it, you'll pull out of the deal. So you’ve got to give him confidence.
So, if you're really certain with a property and you're financially backed, you've got your loan approved, waive the cooling off period, sign that contract and give them the 5% or 10% deposit so they know that you're serious. So, you know, you're not mucking them around. And they'll always have the next property that comes up which they think it fits your criteria and they'll let you know first before they let the public know.
Diamantidis has proved this to be true in his own career.
[27:22] Well, if I look at it from my point of view working in real estate…Around three years ago I created my own website at the time: PeterDiamontidis.com. And at the time, I had a VIP database. So what I did was I got people that actually…if you bought a property from me, you'd go on it automatically; if you're sold a property, [you’re] on [it] automatically. Unless you didn't want to be on it.
People started subscribing on that, because when I was selling properties in the area I had sold stickers saying ‘Sold-off market! Sold off-market!’. Everyone said, ‘How do I get onto your database?’ Go to the database now, and I've got thousands of people on there and they'll be notified first before they actually come onto the market. So, you've got a 48-hour window to actually know about that property, potentially make an offer on that property and potentially buy it.
So I mean, we're wearing two hats. I'm looking at it from a real estate's point of view as an agent, and I'm looking at it from an investor's point of view.
As he reflects on his own property journey, Diamantidis wishes he could instil more confidence into every investor.
[28:41] Ten years ago: When you see a property that you want to buy, don't let somebody talk you out of it. That would probably be one thing that I would say to him or her. If somebody [is] starting off now at the age of 18 or 19 and saw their property, and they've done all their research and their fading mother turns around and says ‘No, I don't like the area’ or made negative comments, proceed in your first instance, your instinct, rather than listen to other people.
Get In Touch
So what’s next in his investment story? How can you follow it?
[29:23] In the next five years, I'm excited to build more properties, more land, purchase more blocks of land and just continue on in building. I've learned a lot in a short period of time—in building, I mean. But in the next five years, I just want to buy more land, develop and stick to doing that.
Thank you to Peter Diamantidis, our guest on this episode of Property Investory.
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