Episode 84: What To Do When You Have Created Your Profit Making Reno Machine
On today’s episode,
In this episode, I am going to share with you the key points that will help you produce that profit-making reno machine.
When building your path to success this will ensure that your progress will result from actively and consciously choosing a life you love from renovating and bring you happiness, fulfillment, and satisfaction in life.
Listen to Episode 84: What To Do When You Have Created Your Profit Making Reno Machine
Podcast: Download (Duration: 21:42 — 22.01 MB)
- [00:00:50] Instagram stories
- [00:01:05] Happy place
- [00:02:49] She Renovates Live
- [00:03:09] Profit making machine
- [00:06:39] Renovating bucket list
- [00:08:25] Build long term wealth
- [00:10:57] Renovating for others
- [00:13:23] Business in renovating
- [00:15:43] Projects to help your family
- [00:18:18] Support your favourite charity
This is Bernadette back with another episode of She Renovates, and today's episode is solo. And before I get into it, I just want to share with you what's been happening this week. Basically, I've been getting ready to get started on our project. We’re in the settlement period at the moment and once I do get started, I'm going to start doing some daily updates in using Instagram stories.
Instagram has really been the wasteland of my business and I've decided I need to learn this new skill. So in this next project, I'm going to do a daily update in stories so look out for that.
I'm really excited about the project, mainly because my happy place is putting it together, figuring out what we're going to do. Sorting out the mood boards and just basically fine-tuning the plan. And so I have definitely been in my happy place in the last week. This is almost entirely a purely cosmetic renovation, which is not something I have - I shouldn't say I've never done it, but I actually can't remember when I last did a purely cosmetic reno so I feel like it's a pretty easy task. However, the times aren't easy, so I need to really make sure that we manage our risk well. And the best way to manage the risk is to get going on it quickly, to get it done quickly and to manage the costs.
Second thing, I visited my grandchildren for the first time in a couple of months yesterday because they've been away on holidays and my darling youngest Jackson is actually walking. So he's not walking, he's running. So walking at 10 months means we don't get much babyhood but he is super cute and that was really lovely. Their chickens have grown up to a point where they can now be in the chicken coop.
I had to have a little smile because they'd been on holiday to the beach and because they were nurturing the chickens, which are now 10 weeks old. So they're more like mini chooks. They actually took them with them, I thought that's hilarious. That little traveling menagerie, but anyhow.
The third thing has been kicking off the launch of She Renovates Live. I'm very excited about that and I'm very excited to be meeting you in the flesh. I can't wait. But anyhow, I have to wait because it's quite a few months away, which from a COVID point of view is quite a good thing.
Today's episode is "What To Do When You Have Created Your Profit Making Reno Machine". What do I mean by that? So when you first start renovating, it's a challenge. When you first start renovating for profit, you may have done a renovation on your own home but this is a whole new ball game. And so getting the right focus on learning new skills, getting the right project, getting the right advice, building your team of consultants, making sure that you buy in the right entity, getting things set up properly, buying the right property, managing your risk, executing the renovation, putting your trade team together; there are so many things that you have to focus on. And once you get a few Renos done using that process, you do get to a point where you feel confident that you have created a machine for want of a better word, for producing profit pretty well and then you start looking for what's next. And that may seem hard for you to believe but I promise you it happens. I see it in my students and I certainly experienced that in myself. And so that's what I want to talk about today.
Now, the reason I'm discussing this is because you need to have a path laid out for yourself, not like it's set in stone but because the thing that makes us happy is not what we have, it's the progress that we make. And I want to refer directly to some words from Tony Robbins because I think this is incredibly important. And often when you're struggling to get off the ground, you feel like that's all there is to life. Once you get there, your life will be perfect. And as many millionaires and billionaires will confirm, it's not enough to satisfy you. And so what I want you to do is to build a path to travel to ensure that you're continuing to make progress so that you can measure your results against that. Now, these are words directly from Tony Robbins, "If you want to have an ongoing joy and fulfillment in your life the secret is just one word: progress.” Progress equals happiness. While achievements in material things may excite you for the moment the only thing that's going to make you happy long term is knowing that you're making progress. To do this, you have to remember while change is automatic, progress is not. Progress results from actively and consciously choosing to create a life you love. A life where you can't wait to jump out of bed in the morning because you are growing, contributing, impacting, and serving." So that is the intention of this episode today. To ensure your ongoing progress and therefore happiness, fulfillment, and satisfaction.
1. TO BUILD A RENOVATING BUCKET LIST
The first point, have a renovating bucket list. This is something I did quite a while ago and I have worked my way through it and I've got probably 3 things left. So the 3 things are: renovate a hotel and combine that with Airbnb; the second thing is to renovate a whole block of flats so units; and the third one is to renovate a website. So those things may not interest you but what you want to do is put together a list of things that do interest you because it gives you something to progress through. And it also makes sure that you develop your skills.
Once you start renovating repeatedly you get very good at it but your skills are quite specific, whereas if you add other strategies to it you expand your skills, but you also expand your profit-making potential because then you can start stacking your strategies. So I definitely think a renovating bucket list is a brilliant idea.
And the other thing is by having those things written down ensures that at some point in your life they turn up because while I have my bucket list written down, I don't specifically go out looking for those types of projects. It's just in the back of my mind. And they do well, maybe sometimes I do, but generally speaking and then when the time is right, they turn up.
2. TO DO PROJECTS FOR LONG TERM WEALTH
The second point, which should have been the first but I decided to start with something that was a little more out of the box, is to build long term wealth but renovate to build long term wealth. So renovating to sell is great for producing income to replace your income in the short term. But as I've said many times that it's the highest risk. And it's also basically a burden in some ways because when you don't work, you don't get paid. So you need to be holding some of those projects in order to be able to get to a point in your life where you no longer need to work to make an income that that income comes to you passively. I use that word cautiously because I don't believe any investment is purely passive. You have to nurture your garden and that relates to your investment properties as well. But building long term wealth is an essential piece of the puzzle.
And I'm going to do a whole episode on this at some stage because a lot of people think that having a lot of properties is what you need. I personally disagree with that because I see a lot of people who have poor quality properties in their portfolio and a lot of them. And I feel like focusing on how many properties you've got is the wrong thing to do so I personally think you should figure out how much money you need, work out how many properties you need to fulfill that requirement, and then go after those properties making sure that they are high performing properties.
The thing about building long term wealth is you will probably stray into other strategies as well. I personally think small development is a really good way to do that because you are then producing new properties. So from a maintenance point of view, they are much easier to maintain and cheaper to maintain but you're still using your renovating to get more equity into the deal.
3. RENOVATING FOR OTHERS
So point three: your next step could be renovating for others, setting up a renovation business. Now, I've seen this happen with some of our students with mixed results. Some students have told me that after renovating for themselves, they really don't like renovating for other people. So one student was renovating for investors and she found that the decisions that those investors made were poorly informed. And so she did not like doing renovations that were not going to get a good outcome for an investment property. However, that's what the owner wanted. And so she found that very demotivating. So really thinking through the implications of the next step is important.
Remembering that once you do take on renovating for others, then you are having to please the client, which adds another element of complexity, too. But for some people, that's what they want to do and they enjoy doing it. I know we've often had buyers agents we had in Melbourne. We have a buyer's agent who came and did our training and she really upped the ante in her buyer's agency business where she is now renovating for her clients and as well as for herself and producing awesome outcomes. It's added a feather to her bow. Now, I certainly did an episode that was with Susie Guest, and I'll include the link to that episode in the show notes.
We've had interior designers who have built their business in renovating. I actually did an episode with one last week, who is Dimitra Oldham and that episode will come live shortly because it's not up yet.
Setting up a renovation business is also a possibility, however, you do need to learn new skills, which is fine but you just need to be mindful of that. And also in terms of managing the liability so there are certain implications that you need to make sure you're covered for when you are offering project management as a service. So you need to cover the legalities of that.
4. BUILDING A RELATED BUSINESS
The next one is to build a related business in renovating. So that could be like I've had a few students go off and become buyers agents or interior designers. They're probably the two main ones. And for me, I have built my business around renovating. I can tell you it's not been that easy. And my darling husband often says to me, "Why are you doing this? Because it's very challenging." And to be able to function and be profitable, it's required me to really build skills that I was seriously hopeless at. I'm sure that doesn't come as any surprise to you but I had this driving force that I wanted. Well, there are a few things but I really wanted to give a voice and inspiration and hope to women who are in their later decades of their life to tell them that it's not all over. Like, I do see a lot of women in their 50s and 60s feeling like that's it and it's really not. And so I felt it was really important to really convey that message. That's been my driving force. I love, well, the other driving force is that I love working with people. But I guess the point here is that it needs, whatever you choose to do it's got to really align with your values and your strengths. So just really going down a path that's going to give you joy.
I can honestly tell you that The School Of Renovating pales into insignificance in terms of income compared to what I can achieve from a project. I am not financially driven by this but I am driven by something that goes deep within that really motivates me to pursue this path to the bewilderment of some of my family.
5. PROJECTS TO HELP YOUR FAMILY
Point 5 is have two projects to help your family. Now, this strategy I absolutely love. And, well, we've done two projects with two of our children. We're waiting for the other two to be ready to do a project and that will happen. And the great thing about doing that is that you just get a lot of satisfaction out of doing something that gives to others but also it's a great way of building the relationship. So doing a project together, it requires that you work together quite closely. And for us with our children, their learning skills from us and we're learning things from them, too. So it's things in terms of style and what people like and, yeah, lots of things. So that is a very satisfying strategy. And even now I invest money, my mother's money in projects, in my projects because if she has the money in the bank, she gets a bit over 1% interest, so much better. She certainly gets a lot better return if we invest it in the projects. So you can do lots of things to help your family.
I had one student who did a renovation for a sister-in-law who was very ill in hospital and she not only decluttered and cleaned up the house but renovated it and sold it for her. That's what she was wanting. And as a result of her work, she added an extra $100K to the price of that property, which was absolutely brilliant. The outcome of that, while sad, incredibly sad, is that the family member actually eventually passed away from the illness and not that far ahead but then that renovator’s children became the beneficiaries of that work that she did.
Not that you'd ever go into a project with that in mind but we do have lots of renovators who renovate their parent's homes when they're downsizing in order to give them more money to be able to downsize. So there are lots of ways that you can help your family with a renovation project.
6. PROJECTS TO SUPPORT YOUR CHARITY
And then the last one on my list is renovating to support your favourite charity. Now, this is something that I never imagined that I would do but we did actually do this for our charity. We support "Hands Across The Water." That is I talked quite a bit about that charity in an earlier episode in which I will include in the show notes. And basically, they provide care for at-risk children in terms of accommodation, education, and love. And so a few years ago, we actually bought an apartment, a studio apartment in Surry Hills and converted it into one bedder, engaged our reno community and our suppliers in supporting that, and many of them donated to the project.
And as a result, we were able to produce $120K in profit, which actually went to the charity to help them to do the work that they do. We support that charity because they manage, they have social enterprises set up to pay their admin costs so every cent that goes to the charity actually ends up looking after the children. And as far as I understand, that donation was really the single biggest donation that any sort of individual had given to the charity. And we were able to do that through renovating. So the sky's the limit.
I'm just going to recap on those points. So number 1 is to build a renovation bucket list. Number 2 is to do projects for long term wealth. Number 3 is renovating for others. Number 4 is building a related business. Number 5 is projects to help your family. Number 6 is projects to help your charity. And so that's today's episode.
I would really love to hear what you're thinking about doing once you have your renovation process down pat and you're looking for the next thing. So if you haven't already left us a review, we would really love it if you did. We read every single one of them and it just inspires us to go on with episodes. So thank you to those who've already done it and thank you in advance to you if you haven't.
And so that's it for today. And as always, you can get the show notes from our website. I'll see you next week.