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‘I bought my first investment property at twenty-one’

‘I bought my first investment property at twenty-one’

Hollie McLachlan says property investors can start much younger than they think, but there isn’t enough education around how to get your foot in the door.

11 December 2022

Hollie doubted her decision to buy a house at 21, many, many times. While overseas in London, there were plenty of times when she thought she’d have to come home to sort out problems with her rental, rather than partying hard in her early 20s.

“I was absolutely stressed and thinking I had to stop my OE and come home for a bathroom,” McLachlan says. It’s the challenge of those ‘What the hell have I done?’ moments that makes investing hard sometimes, she adds.

But she persevered, and owned three properties – a sell, a flip and a buy-and-hold – all by the time she was 26.

Her interest in property investment began during her first year of university, when her brother bought her Rich Dad, Poor Dad. It helped that her eldest brother was a property investor too.

With her degree finished, Hollie got a job with Fonterra and saved “hard” for 10 months. Before a year was up, she’d bought her first house – a $265,000 villa in Temuka. She was 21.

For her deposit, she took her $30,000 savings and $10,000 from KiwiSaver, and added those to $12,000 she borrowed from her parents’ equity: “The bank of Mum and Dad!” she says. When the time came to sell the property four years later, Hollie rallied together some friends and family for a working bee to spruce up the 1910 property.

“There were days spent just sanding, and painting windowsills,” she says. The house sold in 10 days, at the peak of the market last October. Her $290,000 purchase was sold for $405,000, a lot more than Hollie expected: “a crazy amount”.

“At that time there were four other properties for sale in Temuka,” she says. “Compare that to now, when there are 25 houses on the market.”

The money earned from that sale was put towards a three-bedroom standalone house in Spreydon, which she co-owns with her brother. The pair are currently living in
the property, but plan to hold it over the long term.

“We are going to start renovating soon,” she says.

In addition, shortly after signing the contract on this house, she bought a two-bedroom unit and flipped it within four weeks. Hollie, now 26, paid $300,000 for it, spent $30,000 renovating it, and it sold for $465,000.

“There was no way the banks would
have lent me the money, so I used a non-bank lender to get my finances approved,” she said.

Having now done both, Hollie says she prefers the buy-and-hold strategy over flipping.

“With the flipping you get the money straight away,” she says. “But for flipping you need those cash reserves and the bank to help. Ideally, that’s why the next one will be a buy-and-hold too.”

Hollie has a degree in tourism and accounting, but says she learned everything she knows about property investing from her brother: “My older brother told me everything. I wouldn’t have known any of this without him.”

Hollie reckons lack of education might be a barrier to younger investors getting started.

“A lot of my friends don’t know what equity is.”

“It’s so important to get that knowledge out to others. Because everyone can do this,” she says. “Being a property investor sounds scary, but anyone can do it.”

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