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Sticking To The Plan

Determination to stay the course is a mark of any successful property investor, and Charlotte Grimshaw, with the help of family and her partner, has certainly stuck to the pattern, writes Joanna Mathers. Photography Kurt Langer.

By: Joanna Mathers

2 July 2023

Charlotte Grimshaw had a head start when it comes to property investment. The child of property investors, she was immersed in the world of property from a young age.

Her parents instilled the value of property ownership in her from the beginning, encouraging her (and her twin sister) to jump on the property ladder early.

Christchurch-based Grimshaw and her sister were just 25 when they bought their first home. Located in Redcliffs, near her family home in Sumner, it was the “worst house in the best street”.

“We knew that we wanted to stay on this side of town. Not because we are snobs (ha ha), but because we know it would have good capital growth.”

The sisters both had good jobs; Charlotte a property lawyer and her sister in banking, and they saved up for a deposit. They also put KiwiSaver to use in buying their first home.

Grimshaw’s experience as a property lawyer stood her in good stead when it came to buying. It’s her job to work out the legal ins and outs of property purchases, giving her an edge when visiting open homes.

“I was able to see if there were going to be any issues with the houses we were viewing,” she says.

The Redcliffs home was a private sale, and she was able to “whip up an offer” quickly. The offer ($350,000) was accepted … the sisters had taken their first step.

Grimshaw and her twin sister bought their first property together at just 25.

Property Coach

The twins lived together in the home until 2019, when Grimshaw met her husband-to-be, Louis. He was also passionate about property, signing up for a new build townhouse off-the-plan (in the Auckland suburb of Howick) while they were dating. He and his parents used the services of a property coach for investment advice, which gave him an advantage when considering investments.

“Louis is a very strategic thinker and he pushed me to crack on with my investment journey,” says Charlotte.

As the couple’s relationship deepened, it became clear they wanted to move in together. She sold her half in the Redcliffs property to her sister in April 2021, so she and Louis had the deposit for a land-and-build.

“This was reasonably straightforward given I was a lawyer and could look over the contract and information more easily than most. But it was still a real learning curve; learning about building, having to look at things off the plans.”

They really wanted to be in Halswell, as it felt just that bit closer to the city and their families and her work. “But by the time we were looking, there was barely any land available and the sections were getting smaller and smaller with ever increasing prices. So, we jumped on a section in Prevelles (Prebbleton) as it was still a decent size for the price at the time.”

This was completed in Easter this year and they are now living happily in their new home.

The Auckland townhouse, which cost $675,000, is now “probably worth around $750,000,” says Charlotte. It is rented for $575 a week, and property managed in Auckland.

“It is negatively geared, but we are chipping away at it [the mortgage],” says Charlotte. “We think Auckland is a good location, even though it’s expensive, and we wanted to have a house there as part of our portfolio.”

Committed investors – Grimshaw and her husband Louis even signed up for an apartment buy while on honeymoon.

Honeymoon Buy

Charlotte and Louis married last February and spent their honeymoon in Queenstown. And while on honeymoon, they signed up for another off-the-plan – an apartment in Wellington.

They had been keen on diversifying their portfolio, and wondered about the location. Eventually they decided on central Wellington, although “there is only so much land available there”.

There had been an earlier attempt at a property in the area. In 2021, they signed up for another off-the-plan apartment, but due to delays from Covid and the council, the cost became “so outrageous” that the developer pulled the plug.

The second off-the-plan (the honeymoon apartment) is part of a whole building being renovated by a developer.

“It’s right in the heart of the city so a great location and we got this one for cash-flow purposes,” says Charlotte. “It may not be a massive capital growth choice, but we wanted to diversify our portfolio and have something that would (hopefully) be easy to get tenanted and get rent each week.”

Short-term holiday rental may also be an option as Wellington is popular with tourists. “We are considering this but will have to figure out the tax implications.”

Lifestyle Goals

Charlotte and Louis’s strategy is to keep growing their investment portfolio as much as possible before retirement, so they have great cash flow and assets to assist in achieving a comfortable lifestyle when they are older.

“Hopefully [we can] generate a bit of generational wealth, so we don’t have to worry about funds when we can no longer work. We’d like to investigate the other tactic of renovating houses to add value and increase equity as another means of getting lending to increase our investments.”

A yield of 5-6 per cent would be ideal, Charlotte admits, but she’s aware this will be a long-term goal. “We try to be positive about the situation and we are committed to sticking it out as we know we will benefit later on.”

This determination to stay the course is the mark of any successful property investor. Grimshaw and Louis both have strong role models – their parents – who have shown them the value of long-term investment. And while she and Louis aren’t seeing cash flow right now, in the long-term they are certain the sacrifices they are making will pay off.

Renovation may be an option along the road (once they have chipped off their mortgage a bit more). But for now they are happy to do the hard yards and let time work its magic on their portfolio.

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