Property Investory Podcast with Zoran Solano Part 2

03 Aug 2017

The Property That He Rejects Makes His Portfolio Stronger

In this second podcast, we dive deeper into Zoran’s personal portfolio and what Strategies he uses to achieve success, not only for himself but also clients.

Podcast Transcript;

Note: Property Investory Podcast is produced for the ear and designed to be heard, not read. We strongly encourage you to listen to the audio, which includes emotion and emphasis that’s not on the page. Transcripts are generated using a combination of speech recognition software and human transcribers, and may contain errors. Please check the corresponding audio before quoting in print.

Zoran Solano:
I’ve created my own brand in buying property in a strategy that I believe works and it’s using a mixture of strategies from different people and maintaining my independence in what I do.

Tyrone Shum:
In this episode we will be speaking to Property Investor and buyers agent, Zoran Solano: about his mindset needed to generate success in property investing.

With so much valuable experience and a family background in Property Investing, his approach is one to be heard and replicated. So I ask Solano was there anything holding him back from starting in property.

Zoran Solano:
Thankfully for me , I had a real great opportunity when I first got into the market .It was at a time where the first home owners grant was available for established property and obviously the stand duty concession for people buying property as well the first time.

So for me that was really a great opportunity. I’d always worked till at high school, so I’d saved money and by the age of sort of nineteen where I purchased my first property. I had around thirty thousand dollars cash at bank ready to go plus also the incentive from the government so for me I had consciously decided in my teens that property investments was for me and my focus was ok. How do I get into property?

Step 1, you need a deposit and for me I wanted to save that myself and so I did. So as I said throughout school I always had a part time job, a holiday job and then immediately after I decided finishing school straight into the workforce helping clients buy property and be the buying agent as I am today.

Tyrone Shum:
Solano had a fantastic head start in getting into the property buying business. He remained quite focused for a man of eighteen years of age on what he wanted to do and how he would do it. The passion and interest he showed was supported by those close to him, who had experience in the fields such as his mother and grandfather.

Zoran Solano:
Mum was probably the main mentor during that time obviously given that she was one of the leading buying agents in Brisbane at the time and one of the most active buying agents in the Brisbane market. So for me that was quite self evident, that’s what I should do.

But also mention of previous podcast. My grandfather, seeing the opportunity of property plus time . Sorry let me say that again. The right property plus time and the equation that is and the answer that can give you and it can give you options. It can give you growth, it can give you rental return.

So I saw that dwelling up as a really great opportunity and for me a natural progression into it and that was probably one of the main drivers and influences.

Tyrone Shum:
With a lot of family influence in property and experience in the field, Solano has received a lot of valuable advice that has given him the ability to move forward and invest into his own properties.

Zoran Solano:
I think the methods of advice that I’ve gotten over listening to other property experts is well over the years and it for me, I’ve created my own brand in buying property in a strategy that I believe works and it’s using a mixture of strategies from different people and maintaining my independence in what I do.

For me, buying quality as to opposed to quantity is very important. I don’t believe, ten properties in ten years or whatever the height or hot sort of thing might be at that time.

It’s all well and good having ten properties, but are they going to perform, are they going to do what they should be doing, are they working hard for you and that’s also the reason why my portfolio is where it is.

Its like John West . The tuna that he rejects that makes him the best. That’s the same as me. The properties that I reject, the properties that I don’t buy that make my property portfolio stronger.

So that’s one of the key things that drives the strategy of what I do and that’s why I really believe in the quality over quantity.

Tyrone Shum:
After receiving valuable advice from his mentors, Solano was able to develop a strategy which was mainly centred around the idea of quality over quantity when purchasing a property.

Zoran Solano:
When we specifically talk about Brisbane and the Demographics of Brisbane. We see that it’s predominantly in an established house market, that is where we see a lot of opportunity.

Currently if we look at right now, this moment in time, the Brisbane property cycle with regards to growth and we are seeing a lot of unit and apartment development which is also supplying that market.

So the strategy for me is to stay within that distance radius from the Brisbane CBD, because when you compare us to more established cities like Sydney and Melbourne .It’s those kind of inner and middle ring suburbs. Well Sydney is inner city now just in case, but for Brisbane that’s still middle length.

That’s where the real growth has occurred, that’s where the real opportunities have been and for Brisbane, we are a younger city, we are a smaller city but we growing rapidly. In migration of like three quarters has been on the increase while NSW has being on the decrease, shows population in QLD expanding and inside properties increasing.

So for me my investment strategy is really around that proximity to the city and proximity to the Brisbane CBD areas that do have that changing cafe culture, restaurant culture and public transport. Areas that are gentrifying and changing is where I love to buy for myself and the client.

For me I’m a big lover of buying renovate hold or anyone that has ever sort of spoken to me, you know that strategy which is applicable to the right person I suggest.

One of the other key things I consider is the little effect of capital growth. How often we see in a rival market the inner and middle ring suburbs that benefit from growth first and then it’s those bridesmaids suburbs who would join it further out from CBD that have fueled growth.

That ripple, we see that occur in every capital city. We see that growth rippling from the centre out ,but reversely when we see soft times in market change and times of uncertainty. It’s often those outer areas feel that down turn or flat line and then it retracts back to the CBD.

So that’s where that ten to fifteen km increases sort of radius from. Brisbane Capital CBD is where I focus my investment to myself and clients.

Tyrone Shum:
With successful decision making skills when it comes to buying property, Solano has started to focus on buying a certain property type to strengthen his portfolio.

Zoran Solano:
For me is focus on established residential property. There’s a number of reasons for that.

In established areas you don’t have a lot of green field development opportunity, so when you look further out from the CBD, 30-40km you’re got this large acreage farms and stuff that have been subdivided into half land packages.

There’s no scarcity. You know when you look at supply and demand you think back to year 10 economics. Supply and demand is one of the key drivers to growth and price and when you look at other areas or if you look at the unit market, Melbourne and Brisbane right now is over supplied and when this oversupply occurs it starts to saturate the market, not only for sales but also for rentals.

When you have such a high proportion of investors purchasing those style properties, you see that, then that rental market starts to become saturated.

So for me I prefer to buying owner occupied dominated areas in blue chip suburbs or the best suburbs my clients can afford or that I can afford, because I know that those kind of areas are the ones that perform well.

Tyrone Shum:
Coming up after the break we’ll hear about Solano’s research strategy on how he chooses property that leads to a great investment.

Zoran Solano:
So for me those sort of areas showing capital growth opportunity they showing change. So that’s why I love buying in areas with high owner occupier demographics as well.

Tyrone Shum:
As well as which personal habit he attributes to his success…

Zoran Solano:
For me I’m always very conscious of the day to day spending where I need to be. I enjoy the luxury here and there but in general, you have to be discipled because often that a five or ten dollar a week coffee can add up in the long term.

Tyrone Shum:
… And finally we’ll hear what books he recommends for property investors at all levels.

Zoran Solano:
I guess for me I’m always a fan of Biographies. When I’m reading I often grab the audio book and sort of listen to it when I’m travelling or whatever the case might be.

Tyrone Shum:

When looking to buy a property Solano likes to do his research into the history of the property. While nobody can predict the future of the market, doing the research is always key. In his opinion, gambling and guessing leads to a bad investment.

Zoran Solano:
So for me I will always look at historical growth. Obviously no one has a crystal ball to predict the future but we have historical data to go on to see how that area has performed and also what things are in the pipeline to expect change, in that area.

For me I’m not a speculator. When I’m investing, I don’t like to gamble and guess. I like to make inform decisions in an established areas that have that consistency and growth historically and then also have some form of stimulation in that market to promote future growth.

So in a lot of the markets that I buy in or pockets that I buy in around Brisbane. As I mentioned before we seeing gentrification, we are seeing the change of the guard, we seeing the older demographics selling three bed one bath type to the young family who come in and do the kitchen, the bathroom, the deck, they spend for the yard for the puppy dog and that sort of stuff.

So for me those sort of areas showing capital growth opportunity they showing change. So that’s why I love buying in areas with high owner occupier demographics as well. Owner occupier, they buy, they renovate, they look after in general and that improves the areas as well.

When you look at tenant’s, people want to live in desirable areas. There’s another thing I often talk about which a not of people understand but their supply and demand and for me, supply is obviously the available property .

Everyone has to live some where. In general most people a roof over their head, they need to occupy some form of property to live. Now there’s a secondary factor which is the “want” factor.

So is the suburb you buying in, an area people want to buy? Does it have desire, is it desirable for the consumer because people will need to live somewhere and they’ll sacrifice their budget or their family situation and they have to live in a certain area. A lot of people strive to live in aspirational areas.

So for me, I love buying in those most aspirational areas or areas that have gone through that kind of change because it means people want my property, they want to live there, they want to rent it, they want to buy it.

I’m always thinking that if my situation changes then if I need to sell or liquidate my portfolio or reduce my debt and lower my LVR’s.

If I need to sell. What’s my market, and how quickly is that market going to react to my property? So those are all the factors that I look at.

Tyrone Shum:

So what makes Solano so successful? Mindset plays a huge part. In order to be smart and make a good investment, his careful and conscious of his day to day spending, even the small things that he splurges on, but doesn’t need counts towards the bigger picture and helps to keep him on the upward path to success in investing.

Zoran Solano:
For me I’m always very conscious of the day to day spending where I need to be. I enjoy the luxury here and there but in general, you have to be discipled because often that a five or ten dollar a week coffee can add up in the long term.

Let’s use coffee for argument sake. you buying five or six week of them a week, which I’m sure most people are probably doing. that thirty dollars a week times fifty two is one thousand five hundred and sixty dollars a year.

That doesn’t sound like much, but when we produce that money as an investment into our portfolio. A thousand five hundred dollars I could add stand like combos to my three bedroom investment property which increases the rentability of that property but also that expense is now a tax deduction.

So I look at all those kind of opportunity cost everywhere in my life of ,how can this money work for me?

But also the bigger picture which often this might scare some people or even think about, is the compounding growth of that one thousand five hundred and sixty dollars a year in twelve years time and it’s a very high concept especially when you’re a young person to really realise the cost of that five dollar coffee. Because that could be compounding over six per cent per annum over the next thirty years and can really change the end result.

So for me every little cost I’m very conscious of but having said that you do need to live, you do need to enjoy.

Tyrone Shum:
Yeah that’s a very good point because if you want to invest it’s also important to put money aside as well and saving  those extra dollars, makes a huge difference even when you say having no coffee will stop you achieve from having those goals.

Zoran Solano:
Honestly it’s one of my largest frustrations about people. Unfortunately these days people want to get ahead, but they not willing to sacrifice anything to do it.

I think it’s a generational thing as well unfortunately, but don’t get me wrong, there’s still people there, they sacrifice and they want to get ahead and willing to make a change. But I have initial confrontation with people who want the world. They want everything handed to them on a silver platter and unfortunately that’s not how the world works sometimes.

So, yeah being very conscious of those cost and look what I’m saying maybe very controversial to a lot of people and there might be people listening, there might be some people who completely agree. It’s up to them.

I’m always known as a straight shooter and yeah that’s my thought.

Tyrone Shum:
With a background in the property buying world, Solano searched for other forms of inspiration for his own buying strategies in order to develop a strategy that suited what he wanted to achieve and the type of properties he wanted to buy.

Zoran Solano:
I’m currently reading a book that’s not really property specific, but I guess for me I’m always a fan of Biographies. When I’m reading I often grab the audio book and sort of listen to it when I’m travelling or whatever the case might be.

So that’s one of the main things I enjoy. I’m personally a big fan of Branson. Richard Branson for me that style of business and the concept of his business strategy is really important and I think I take a lot from that.

At the moment I’m reading a book by Aaron Sansoni, ”Think Like“ and it basically breaks down the world’s top twenty most successful business people and goes into what drives their success.

So for me that’s what I’m currently reading and Aaron Sansoni is a very good friend of mine. I have done some training and work with him. He’s one of the key influences, negotiators and that’s where I’ve done a lot of training and negotiation to help my clients and yeah, one of his books is what I’m currently reading.

Tyrone Shum:
Do you wish to be one of those interesting people that Solano talks to? Do you have any questions or queries for him? If so…

Zoran Solano:
You can jump on my website. Hot propertiesbuyersagency.com to look at what we do but I’m happy to give out my direct number. 0424271123 because I really love having initial consultations with people and chat to people and I’m available all the time.

Properties for me as you can tell is my life and I love talking to people during the day ,on the weekend that sort of stuff. Anyone interested give us a call.

Our office is: 07 3170 3760, if you can’t get a hold of me.

Tyrone Shum:
Thank you again to Zoran Solano: for joining us in this episode on Property Investory. If you want to hear about his journey on how he became a property buyer’s agent and then made his leap into the investing world, securing a real estate license at eighteen and purchase of a property at nineteen years old, then visit our website at propertyinvestory.com.

Simply type in the search bar Zoran Solano: and select that episode to listen and learn more about his story.

You can also get the full transcript and show notes on our website.

Thanks for listening.


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