23 – Mary Benton: Accountant, Financial Planner And (now) Renovator

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financial planner and renovating

Bernadette interviews Mary Benton, one her students in The School Of Renovating. Mary has over 30 years experience as a chartered accountant and has her own financial planning practice. Mary inspires us with her successful renovating story and shares with us valuable tips on creating an income to live a life you love.

Listen to Episode 23: Mary Benton

Podcast: Download (Duration: 22:55 — 41.94 MB)

Bernadette covers,

  • The reasons why Mary, as an accountant and financial planner, got started on renovating and property
  • How Mary successfully renovated her 10-year old home with Bernadette’s guidance
  • The lessons Mary learned from starting a whole reno project and finish it just after Christmas
  • How Mary used Airbnb as a way to generate income from her reno while waiting for the right time to sell the property
  • What are Mary’s key drivers for increasing the value on her property
  • Mary’s overall game plan to achieving her dream house and making it her lifelong project
  • How working with the right buyers agent can help get local opportunities for her projects and sell them on the market
  • What are the actual elements of her renovation project that helped increased it’s value
  • How much renovating has impacted her life
  • Why Mary as a financial planner became so in love with property
  • Mary’s top 3 tips for renovators and investors to creating an income to live a life you love

 

Episode highlights

01:22 – Having the money to live a life you want

02:06 – What’s your renovating and property story?

02:31 – I went to one of your Masterclass

03:21 – When you renovate your own home and add value to it

04:07 – It’s just a really relaxing and a beautiful space

04:56 – That’s the real power of Airbnb

05:55 – The key drivers for increasing it’s value

06:26 – A massive increase on your money

06:52 – My overall game plan

08:15 – So many ways to get what you want.

08:38 – The end goal at the end of the day

09:26 – A real estate agency to work with you

11:13 – The elements that are actually increasing the value

12:24 – Do the groundwork in your research

13:24 – How has it impacted your life?

13:57 – I just made it into a home

14:25 – Given me back my confidence

14:50 – A financial planner whose mad about property

15:39 – Property is a long-term investment, it moves.

16:50 – 3 biggest tips for renovators and investors

20:45 – Start early, work out, use a phone and get onto the marketplace.

Transcription

Mary: We we’re starting to reach into the wine cellar but then that’s what it’s for, because I’m so scared now that it might have it in 20 years, It’ll just be vinegar. So, exactly, yes, I got it, that you’ve got to enjoy this stuff.

Bernadette: You do. Yes, no point in keeping it. Okay and so you’ve sort of touched on this, but how has it impacted your life?

Mary: Well, first of all, I’m in the space that I love. So every like I’ve got it’s a massive outdoor deck, I’ve made it all beautiful, good furniture about 3 different spaces out there where you can sit in, be peaceful with city people.”

Well hello! It’s Bernadette back again and today I have an interview with Mary Benton. Mary is based in Melbourne, and she’s been a chartered accountant for over 30 years. She originates from the UK, and she has her own financial planning practice. Where her company values are very closely  aligned to ours. She’s just finished her first reno, and she’s also established a strategy for moving forward with her renovating, so that she gets what she wants out of life. Mary is all about having the money to live a life you want, that’s one of our alignments and there are many others. This makes for quite an interesting story, I think you’ll enjoy it.

Bernadette: Welcome Mary! So how are you today?

Mary: I’m very good thanks, Bernadette. How are you going?

Bernadette: Yeah really good. And so today we’re going to talk about your renovating and properties story and because of your background you’re an accountant and a financial planner I think you bring a whole perspective to renovating a property which I think is really helpful for people listening to what you have to say. But before I get into that, can I ask you what’s your renovating and property story?

Mary: Well I’ll tell you how I got into it. I mean I’ve always loved property,  but a year ago almost I’d split up with my partner who thought we were together for life and it’s lit up so it’s got you a very sad patch and suddenly out of nowhere a Facebook ad popped up to you and I don’t know why, I never read Facebook.

But anyway I saw this and for some reason I clicked on it and now I’ve joined for some reason I went to one of your 4 hours or what they called Masterclass or whatever. And it was just, it’s lovely I don’t even know why I did it. I was depressed at the time really. And I’m sitting in this room and you’re saying well where are you gonna start ? And I’m sitting there thinking where will I start? And then you gave the suggestions.

Because this is how you work, Bernadette. So you gave us suggestions, and one of them was going to put your own home, could you renovate your own home? So my instant reaction is, of course not! It’s sort of a 10 year old home, it’s pretty nice, there’s no way. And then I caught myself saying it and thought, no, don’t be negative.  And I suddenly realised it was it was 3 bedrooms but the designers have originally designed for 4 bedrooms. But they for whatever reason had left one wall right up and never built it. So just think of it. Could I renovate mine?

So I went home sort of inspired still depressed, looked at my house. Yeah! I can do this. And the really good thing about it, is obviously when you renovate your own home and add value to it, there’s no tax on any of that.  I worked and if I could do my reno for $20,000 grand and add maybe a $100,000 grand for the value of the property which even in the down market has happened. Because it would be worth at least $100,000 even if I hadn’t done the renovation at the moment.

And so I started doing that whole reno and finish that just after Christmas. It was a bit of a slog in my situation, but when I finished it and put it on the market to sell, so I can then move out in my own home, buy another one, do it again. The market’s been really slow.

So that’s my renovation story. Since then, I’ve been Airbnb it at the same time and having a ball, but I think it’s a different story for a different podcast.

That’s my reno story, so it looks like a show home. The guests that are coming into it just love it. It’s just a really relaxing and a beautiful space. Because you told me that I could also do styling and I said I can’t! I’m an accountant, there’s no way. Somehow I managed to do it, went around and bought loads of artwork and different things and just experimented with it. You pretty much held my hand through that whole thing and gave me the confidence to be able to do it. It’s been very good fun.

Bernadette: I know you’ve crossed  over to Airbnb, but I think that particularly in this market, is a really important piece. Because as you say, you can’t, your timing sucks. Through no fault of your own. Like rather than sell it and not get the sellers in the down market and not get it’s real potential. You’re able to keep it and actually could generate an income from it. I think that’s the real power of Airbnb, it gives you more options.

Mary: It does. Absolutely. And because this is the way we keep it,  I reasoned. Yeah I’ve got to keep it looking great anyway for every week’s inspections. To keep it clean and tidy. It’s no different when you Airbnb,  you’ve got to have it clean and tidy between guests and the only difference is that I have to remake beds. But everything else is exactly the same, so there’s no issue on like that I’ve Airbnb it while I’m waiting.

I got bored, because after I finished, as you know when you’re renovating yourself, you end up doing lots of painting and hanging pictures, cleaning. As you go along and some curtains and cushions and the like, so to suddenly have nothing to do, you’re sitting and waiting for an opportunity to turn up and the markets to change. You get bored, so suddenly I’m Airbnb it and I’m not bored anymore.

The house is full and it’s exactly what it should be. It’s just great.

Bernadette: That’s awesome! And so  just going back to your reno,  so I know you cosmetically renovated it,  but what would you say the key drivers were, for increasing its value?

Mary: At the time I’d already because my own home I know when I sell it there’s no profit to pay on extra not any profit. But the house was effectively already financed to a decent percent, there’s not a lot of equity left in it to go and do something else.

Yeah, so my driver was well if my equity part of it is say 20% and let’s say that’s 150 lbs. on each bag. So if I can suddenly increase my equity from $150,000 to $250,000, that’s a massive increase on your money for doing a small reno. And so that then gives me a highly opening opportunity to take that equity into the next place to not only obviously purchase the property, but then to be able to do the renovation on it.

So, that was my driver for it. If I can take effectively $20,000 grand now and create $100,000 grand which I can bring in to the next reno which means I can do a more significant reno and then that equity that I create from that one can go in the next one.

Would you like to hear my overall game plan?

Bernadette: I would love to hear your overall game plan!

Mary: I worked out that if I wanted to move into a certain suburb and I wanted to do this in a way that made sense for me, then I’m going to find a property in the suburbs with a geographic location that I eventually want to end up in. And in my case it was, I looked around what I really liked. So there’s a mansion I like down in Victoria, and those people who have their eyes on it, know it’s pretty pricey. I didn’t know that when I found it. I thought, oh this is nice! I could live here. So my strategy then is has become, if I go and find myself a  lower value, it doesn’t matter where it is. Something in that suburb, a unit, a little house, that needs a lot of work or a lot of TLC that I can go into that market, do my reno and then I’m buying and selling into the same market.

So if each time, even if I’m only making $50,000 grand, but if I could make a $100,000 grand and I can trade up over the next 5 to 7 years in that market. My end goal is to have one of those big, like $2 million dollar mansions, its back 10 blocks from the beach. But get into it when it again needs a lot of work done and I can make that last one my lifelong project. I can trade up, no tax on the way, just don’t change it, but you can do that if you want.

That’s my plan.

Bernadette: I love it! And I love that about you, but the thing about renovating is there are so many ways to get what you want. Like people I think tend to be quite single visioned in, watch all the telly shows and think that the only way you can make an income from renovating is by buying, renovating and flipping.

Mary: There are just so many other ways that you can get to where you want to go. The end goal at the end of the day for all of us should be to have no mortgage, not on our personal home and so then your home becomes the asset you can borrow against, if you need to, which is what you’re doing is you have a line of credit that you’re keeping that and so if we get to the point where our homes have no mortgage, we pretty much, we’ve done a great job.

Bernadette: Exactly!

Mary: My idea is to put all the deductions in renovation and trade up as I go. And the good thing about it is, that the market has come down a bit so the likelihood of getting a good buy.

Bernadette: It’s a bet that’s right yeah. But you’ve taken your game plan a tiny bit further haven’t you? We enjoy putting some structures in place together.

Mary: Yeah that’s right, so I’ve already gone to, the other thing I know is, you have to. And you’ve told us this again as well but I didn’t think about it then. You said you have to go look for a real estate agency to work with you. So I went around to see one of the properties that you opened, not to see the property, but to check out your agent and see how they responded to me and I found that he’s a really nice agent. That just told it straight. Wasn’t bullshitting or anything, had done Airbnb himself and done a reno himself.

And then said to him, okay I wanted to effectively have a relationship with you over the next 5 to 7 years as I’m doing this, here’s what you’re gonna want to do. I want you to be the right one that show the properties and I want you to the person that sells them for me and there has to be a certain profit margin each time otherwise, I won’t have any interest in you.  Because at the end of the day I want my big guys to live on the beach. So he’s already got local opportunity for the houses came back from the beach and I’m not ready yet to go to the other ends. It’s not trading up but he’s been great, really good, supportive, hard to get in at the bottom end of the market. So he’s really got his eyes peeled and at the moment, all they’re waiting for is my house to sell so that I can move into the next one.

Bernadette: Yeah, and are you reasonably confident that will happen in the foreseeable future?

Mary: Well I think at the moment the election is putting a bit of a cloud over everything, because nobody wants to make a real move unless you’re a first home buyer. Nobody wants to make real move before election with labor getting high and house prices tumble and nobody wants to behave just signed a contract that something they could have gotten it for $50,000 grand cheaper. So that’s all that’s happening in the market.

No I’m not really that fast I said I don’t do openings over Easter anyway. Take a few days off and so it sort of suits and you know because I think if there is an election mid-may we shall be like the market should start to move again pretty much straight along.

Bernadette: Yeah right and the other thing I wanted to ask you so I meant I’ve got a bit sidetracked before so in terms of the actual renovation what elements are actually increasing the value of it? So what were the key things that you did?

Mary: The 3 to 4 bedrooms are the most significant. It was already 2 bathrooms, so I could go for a 4 bedroom and a big living space and that’s why it could go to 4 bedrooms quite easily. And that was mine, I think putting that wall up might have been 1 or 2 bags of dollars, that was definitely a massive family home.

But I also took the movie room that is a 6 x 4 meter movie room and I chopped the end off so it’s 4 x 4 and went right all the media shops. I first measured their rooms to check it, but eventually it works a treat, it’s so brilliant. And I use that extra 2 meters that I cut off to create a 3rd toilet, so straight off sort of the living room. A little powder room and a wine room. And so when people walk in and they sort of go into the door in the movie room and then turn around the corner and there’s a wine room there and it’s sort of like a wine factory that sort of thing. They can see themselves reading and watching movies and after making coffee or having cheese or drinking wine and that’s just that. That was fun. I never would have thought of that.

Bernadette: The thing that I love about you, is you actually do the groundwork in your research and it makes such a difference. Because just going to the extent of actually going and measuring up media rooms and making sure that you haven’t compromised the integrity of the room. Yeah. And I think the wine room, I would buy a wine room.

Mary: The really  scary thing is, I put all this wine in there that over the years people didn’t give some credence and they’re really expensive. Anyway, now that I got this winery setup and it’s all on display. Just over the last couple of weeks I was with my Airbnb guest, so I’m going, oh! Let’s open a good bottle of wine tonight. Let’s get it. We we’re starting to reach into the wine cellar, because that’s what it’s for,  I’m so scared now that it might have in 20 years, It’ll just be vinegar. So, exactly, yes, I got it, that you’ve got to enjoy this stuff.

Bernadette: You do. Yes, no point in keeping it. Okay and so you’ve sort of touched on this, but how has it impacted your life?

Mary: Well, first of all, I’m in the space that I love. So every like I’ve got it’s a massive outdoor deck, I’ve made it all beautiful, good furniture about 3 different spaces out there where you can sit in, be peaceful with city people. I’ve got now my movie room, just go and sit and just be really calm watching whatever you watch. I’ve got bright spaces right around in my main living area next to the open end. So there’s so many spaces now to get away, to go alone or to just sit in the kitchen and mingle with everybody. It’s just, I don’t know, I just made it into a home to be honest, even if we’re going to  sell it. Even if it looks like it’s a display, Looks like it’s a highly suitable. So that’s the first thing if you like to come home and live happy. Now that changes everything.

And the second thing is, I know it’s actually putting the value of the home back to our ship, which makes me happy that I got it on the market if it doesn’t sell, that’s alright, we’ll move on. And in the meantime, because we’ve now allowed it into Airbnb so easily, it’s looking after itself anyway . So it’s really given me back my confidence, given me back this game plan. I know what I’m doing and why I’m doing it. Yeah. it’s gonna be a future direction and a target. Put me back in control, people, that’s what it’s done. Yes and that’s what it’s all about isn’t it?

Bernadette:  Awesome. So this question wasn’t on the list but I’m gonna ask it anyhow. it’s really unusual to have a financial planner who’s mad about property?

Mary: It’s funny, if somebody put a post up on these the other day about it and I was like okay I haven’t seen that memo yet. Wasn’t out that too much when you talked about property, because to me it’s just a core part of what you do and the way I explain it is like psychologically keeps to sciences,  shares might get a better return on paper, so slightly, half a percent over time and they might actually own more than property. But you don’t hear about shares, more and more you hear about property and psychologically when you have a property you don’t sell it at the drop of a hat.

So if the market suddenly crashes, you don’t go out and say, quick get someone on my property because the market is crashing. Or if it’s your shares you’re doing and you end up locking losses all the time, shares like that, she just really popped. Property is a long-term investment, it moves. But it’s one of the ways you can make so much money.

I’ve run workshops with first time owners, and I say you need to get on the property ladder without over reaching it,  you need to have that as the core part of the strategy before you start anything else. And then you throw all your extra money at paying off the mortgage, you shouldn’t have that. But you need to earn at least the roof over your head.

It’s so important that you go apply for credit. And say you’ve got to buy a car and they say, oh you’ve got a rate for just that, perfect. They just give you whatever you want, because you’re a credible human being member of society and because you have a property.

Definitely record what everybody should be doing. And if you’ve got strategies, where you can use that, for first time owners and customers, is their principal place of residence at the time.

That’s phenomenal that we can do that, but you have to be careful if you keep doing it every two months, you’d be running a business. You would get sprung from keeping them. But if you’re doing it every night, it’s not. That’s what you do, you buy something, it’s not big enough to move up.

Bernadette: Exactly, it’s sort of like climbing a property ladder. And finally, what would be your 3 biggest tips for renovators or investors?

Mary: In terms of renovating, I would try and use the same trade to do more than one job, though I used a different person to pull down the plasterboard and put up the sticker to the person who then came and did the plastering and then the person who came, the company that came back to actually do the fix, but never like rate you there.  Then I choose another in the middle of the plumbers, the plumber did the timings, maybe you should know how much you do timely, but the tiler wouldn’t turn up.

The next that was created,  because I had different tradesmen in the night who didn’t care about the previous person’s work, therefore they just made it work.  I would actually get fixed price quotes up front, which I didn’t do as I’m putting such a minor reno. I would try and use the same builder to organise the trading. And get a fixed price special form, so even for the powder room, I really should have gone for one carpenter, who also could control the plasterer, control the plumber, except do the whole job. Then there’d be no fights between them, never went over budget.  I think that’s probably one of my biggest tips, try and keep the same trader if it’s possible. Have the same builder and a project manager. And get fixed price quotes up front. Yeah, nothing extra, slips through.

One other tip I would give people, so I don’t know if that was 2 or 3 tips there, I’ll give you another one. I got all of my furniture and artwork on Facebook marketplace.I literally just hopped on there every week. Okay, I need a picture here, I need a board that’s going to fit this size a little bit and something would come up and it always comes up at exactly the right time. And I drive there and I go and sit and I spend my weekend going looking and picking.  I’ve also met some fabulous people doing it and got the best bargain. That’s so much fun!

And then if you put some thing that didn’t fit, we have extra use for it. I will put it back on the marketplace and sold it on my own. It was just awesome. So I think we need to allow time for that. I know if you’re the one starting on that, you got 3 weeks, to go and get everything done. I probably could never do that, because it would take me at least 3 or 4 weeks just to pick up things off on the marketplace. But I just love doing it.

Bernadette: I agree, the marketplace does take time, you need to start ahead of time.

Yeah, but there was, it’s interesting, I was looking for these chairs, prospect chairs because I’m doing up a studio at the moment. And like new, they were about $200 each and even secondhand I was looking at around about $130. And in one morning I woke up and he had six of them for a $100 and so with someone who was emptying out the Granny’s house and I only needed 4, so I thought, I bought them for $100 and sold the other two for $150. So I made an earning..my children thought it was terrible.

That I should do that. But yeah, it’s good.

Mary: Well if someone wants a big table like that and I wanted 10 chairs but couldn’t find them both. Then these 10 chairs are just on, when I’m searching liquors and chairs and 10 of them came up, they were only selling chairs. So I got them and I wonder what am I going to do about a table? And the prices for chairs was like $450, but they were really mint conditions, which is a really solid, old fashioned good chairs. And then because the chair legs have timber on them, I tried a timbered table for a $100.  And made an earning of $80. A massive took way for me, to buy something it’s such a treat, you cannot tell they’re not the same pair. And it was just a matter, if you took a bit of doing and looking around. When the stylist came, I didn’t end up using a stylist, not that I don’t want one. But I got one to come and have a look to start with and the first thing she said to me is, well obviously you don’t need to change any of your furniture, because you’ve got really quality pieces. And I just had to hide my face on my hand because I was chuckling away that my quality pieces were bought secondhand. And she’s like, yes I would have caught it and I never. But the rule books of training sites will try them. So it’s not $5,000 a piece, so it was good.

So that’s my other tip then. Start early, work out, use a phone and get onto the marketplace and stuff. Just collect, because you can always resell, if you’re buying something and you end up you don’t need it.

Bernadette: Exactly! You’re a girl after my own heart, it actually makes me feel so happy when I hear you talking about styling your own property.

Mary: I know.

Bernadette: And with such confidence.

Mary: Yeah.

Bernadette: So Mary and have we got some photos of your property?

Mary: I can send them to you.

Bernadette: Yeah. I would love to put some in the shownotes because I’m sure people would be interested to see the finished product.

Mary: Yeah, absolutely.

Bernadette: Thanks so much for coming on and sharing your experience, it’s been really lovely to have you. And just for those listening, Mary recently did a talk for us on buying property and also renovating in your Self-Managed SuperFund and so we’ll be releasing that as a podcast episode shortly too. So just keep your eye out for that. On that note, we will end this episode and thank you very much!

Mary: Thank you, Bernadette. Take care.

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