When Kariah Lieu was 19, she had a property epiphany. She was on holiday with her mum in Australia, visiting friends and family, when she was invited to a house owned by an acquaintance.

“He was this really rich guy, who owned heaps of property,” she shares. “His house was amazing.”

Although they’d just met, the man wasn’t hesitant about asking some searching questions. “He asked what degree I had, what I did for a job. I told him I had no degree, I’d left school at 16, and was working part time in retail.”

His response was cutting. “He called me stupid for leaving school, told me I was dumb for not getting a degree. When I got back to my accommodation I started crying. I phoned the airline and asked to be put on the next flight home. I was in New Zealand the next day.“

It was a painful moment for Lieu, but a pivotal one. “I decided soon after that I was going to buy property and become successful. And that I would never talk down on other people like that.”

Determined Saver

Lieu was born and raised in Auckland, attending school in Glen Innes, East Auckland. Although she left school early, she did a few certificates at MIT, and found a job at Baby Factory in Newmarket. But after her unpleasant incident in Australia, she came back with the determination to get a full time job so she could save up for a deposit.

She had honed her customer services skills at Baby Factory, and was able to secure a full time job at the Department of Internal Affairs, working at the registration office for births, deaths and marriages. And she saved.

“I lived with my parents to save money for a deposit,” she says. “My friends were going out and spending money, but for the first two years at Internal Affairs, I saved everything that I earned.”

She owned a prepay phone, and wouldn’t make calls out; she parked for free in her mother’s Sky City membership card. And she wasn’t tempted to join her friends in the traditional early-20s party lifestyle.

“I have always been really independent and liked doing things differently,” she says. “So, it wasn’t really hard for me to do my own thing.”

She also educated herself on everything property – attending free seminars held at Auckland Property Investors Association (APIA) and free introduction events held by organisations who would often try to sign her up for paid courses at the conclusion.

“I got really good at saying no,” she laughs.

After two years of hard saving, by 2010 Lieu had amassed $40,000. She was 23, and earning less than $40,000 a year.

First Foray

While saving, Lieu had been researching houses for sale in her area. In 2010 investors only needed a 20 per cent deposit for property, and she eventually found a brick and tile unit, circa 1960s, near the Panmure fire station and shops that was ideal.

“It was $236,000 and it already had tenants,” she shares. “I found a great mortgage broker who helped me secure a mortgage. The unit was in pretty good shape, and was bringing in $200 a week, which covered my costs.”

The whole process was smooth and Lieu was delighted to own her first investment property.

“I used to drive past and think ‘that’s mine’,” she laughs. “It was really exciting.”

She renovated the unit in 2021 (for just $23,000) with the help of a work colleague’s husband who was a builder.

“We opened up the kitchen to create an open space living area, put in a new kitchen and renovated the bathroom. After that I was able to get $350 a week for the place.”

It would be four years until Lieu would buy another investment property. But this time she wanted something more substantial: “A three-bedroom freehold house, with a garage and land.”

Drawing advice from her broker, she ascertained that she would be able to purchase a property for between $300,000-$400,000.

This was 2014, and properties in some areas of Auckland were still within this range. She discovered such a property in Otara: a recently renovated three-bedroom, which was nice and tidy, and fit the bill. She managed to purchase it for just $375,000, and had it tenanted (bringing in $400 a week) within seven days.

Flipping Solution

Changing regulations and the soaring cost of housing have put the handbrake on many investors’ plans over the past few years. So, while buy and hold had been Lieu’s preference, she ran into repeated affordability and serviceability issues when she tried to secure more property.

When she asked her mortgage broker what she could afford to buy, he answered “a house in the $150,000- $200,000 mark”. Which in 2018, essentially meant “nothing in Auckland”.

But Lieu is a firm believer in the old adage “where there’s a will there’s a way”. She started hunting for other options.

It was her mortgage adviser who suggested flipping. “I didn’t even know what is was,” she explains.

Once again, she began educating herself around property. With the help of her mortgage adviser, the deposit and renovation funds were pulled out of equity from her existing rentals, and the remaining funds secured through a nonbank lender.

The property was in Nawton, Hamilton; this was before the Hamilton market headed sky high, and the property was bought for just $292,000.

Rather than oversee the renovation herself, she used renovation specialists Maintain to Profit for the job. This was a smooth process – and from settlement to selling only took two weeks. She made a small profit ($10,000) but says she learned some good lessons.

“Never trust everything an agent says,” she laughs.

Lieu believes that the agent talked up the potential of the property in order to push the price up, and that she paid too much.

“But everything else was great. Maintain to Profit taught me the steps in a house renovation. And I used the top agent in Hamilton. It was a really useful exercise.”

She was keen to do more flips, but the upwards trajectory of prices in Hamilton saw her priced out of the market. Instead, she started looking in Tokoroa, working with iFindProperty’s Wayne Dickson to find suitable houses.

“He was amazing, so knowledgeable,” she says. Dickson found her four houses over three years – Lieu averaged between $30,000 and $80,000 profit for each. This allowed her to build up capital … and leave her job. “Even with my salary I wasn’t able to meet the serviceability requirements for a bank, so it didn’t seem like there was much point,” she shares.

‘Maintain to Profit taught me the steps in a house renovation. And I used the top agent in Hamilton. It was a really useful exercise’

Expert Advice

As useful as flips were, buy and hold had always been Lieu’s passion. She drew on the expertise of Nick Gentle (who offered her a free coaching session) for an analysis of her portfolio and ideas for future growth. And he gave her some useful, if initially unwanted, advice.

“He said that the Panmure unit was only getting a 2-3 per cent yield in the current market, and it would make more sense to sell. I was really hesitant, it had been my first property and I loved it.”

But after consulting a few other experts, who gave her the same advice, she realised it was the best decision for her portfolio. “So I cashed in the Panmure unit for $810,000 last year,” she says.

Lieu had been made aware of renovation coach Ilse Wolfe from Opes Accelerate, and her “cashflow hacking” philosophy.

“Her values really aligned with mine, so I thought I would jump in with her,” says Lieu. “She’s really helped with support and confidence in what I already know and where I wanted to go.”

With the freed up capital from the Panmure unit, she was able to purchase a Whangarei three-bedroom home on a corner section for $551,000. This was renovated, and transformed into a five bedroom home – with a budget of $100,000.

“It’s now valued at $610,000 and the rent is now $695 a week, up from $400. But that is only half the story.”

The 860m2 site is located in a medium-density residential zone, which allows for a second minor dwelling without the need for subdivision. Lieu will place a small Keith Hay home (two bedrooms, at around $300,000) next to a double cabin with another two bedrooms, creating a four-bedroom property.

“The whole section, with two dwellings, will then be valued at $1 million plus.”

She also has plans for the Otara property – the size of the section would allow for a townhouse development, something she is investigating.

Lieu’s property journey has been based on education and determination. “I had many ‘no’s from mortgage brokers and lenders over the years, but that didn’t discourage me. There is always a yes out there so keep searching and never give up. It comes down to the mindset and working alongside the experts who have the results and can help you move forward."