Case Study: The Portfolio Plan

Posted 14 Nov '23

by Nick Gentle on
Article appears under: Investment Strategy

Sarah (not real name) first approached iFindProperty 2 years ago. She had bought an investment property and wanting to know "what next". She wasn’t confident with some of the advice she and her partner had received, so I introduced her to a property accountant who identified some issues with her loan and structure that were going to slow her down.

Sarah needed to work through those issues, and while it was frustrating, it was the right thing to do. While they worked through that Sarah and her partner also built up and sold a business, so once they were ready to go, they were in a strong position with the proceeds of the business sale to invest.

This second time I spoke with Sara about property, she was clear she didn’t only want us to find her a deal; she wanted assurance that not only would she be doing things right, by buying a good property, but also that property was the right move and they would build momentume towards a portfolio that would achieve their lifestyle goals.

I suggested we team up with the smart financial advisor team at Velocity Financial to integrate what I thought they could achieve with property into a long-term model for “everything” around investment and finances – i.e., jobs, mortgages, other investments, kids, lifestyle… as well as property. I don't think there is another service out there that can take the nuanced property investment strategies that we here at iFindProperty can put together, and put them into an overarcing financial plans.

We ran three sessions over approximately five weeks and session one was fact-finding; we wanted to know what Sarah did and didn’t like and what she wanted to achieve.

The goal for Sarah and her partner is to be able to retire in 10 years. They were prepared to leverage existing assets and invest the full proceeds of the business sale, plus existing property income, to grow their wealth and passive income over this decade, while they would live off their day-to-day incomes. They didn’t want to have to compromise their lifestyle and continuously top up their investments to make them work, and wanted confidence that actions taken today would pay off in a decade’s time.

Velocity and I spent time working on a multi-year strategy, which AFA Elizabeth presented to Sarah a couple of weeks later in session two. Sarah had some ideas and questions, and we came back two weeks later with our final plan.

I was really excited by what we came up with as a group; in Sarah’s case the Velocity team’s modeling tools showed that by investing the profits from our cash-flow positive property strategy into other managed funds, over 10 years they would be more than $1million better off than had they just invested in property alone and ignored other opportunities available to them.

Sarah’s plan calls for 3 purchases over the first 5 years, while selling one property that doesn’t fit her cashflow strategy at year 3, to fund her second and third purchase.

Once Sarah was confident in the plan, she worked with iFindProperty buyers agent Chris McKernan in Christchurch to source the first property. Chris showed Sarah, who lives in Hamilton, several options, and over 3-4 months helped her make offers, negotiate, inspect, and do due diligence on potential deals. Some searches are very fast, however this one took a while because Chris encountered a difficult vendor, who we eventually had to move on from. In the end Chris helped Sarah to sew up a great student rental near the fastest growing university in the country. Sarah never had to book a flight, visit open homes, or learn “the hard way” about how to invest in Christchurch, and she bought very well.

I asked Sarah about her experience:

“I loved that the plan was so strategic, methodical, and didn’t just look at property, but our overall goals. On top of that, the level of expertise on the property acquisition was very high and I feel like I have made a sophisticated investment.

The wider investment strategy via Velocity means I am moving ahead with good move building on good move. My family takes up a lot of time, so I’m very happy with the support I received through the process. Excited for the next steps.”

- Sarah

iFindProperty sources properties for clients in all areas of the property market; existing homes and value-add projects, development land, new builds, and commercial property. Working with Velocity’s smart team to produce an overall plan that includes sophisticated property investment, I feel we bridged a gap in the marketplace, where property solutions from financial advisors can be one-size-fits-all.

The end of the year is a natural time to reflect on things and plan. If you are interested in having the outcome we achieved for Sarah, please get in touch via the below form, and we can set up a free 15-minute chat.  

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Nick Gentle
Business Owner & Operations Manager
027 358 3855

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