Young millionaire says Gen Y need to change habits to buy their first home

Young millionaire says Gen Y need to change habits to buy their first home

PROPERTY tycoon Tim Gurner hit back at the response to his controversial 60 Minutes comments, saying his first investment was the darkest period of his life.

Mr Gurner copped backlash after suggesting young people spent too much money on travelling, coffees and smashed avocado.

The young rich lister who made his fortune off the back of Australia’s capital city property boom told 60 Minutes “when I was buying my first home, I wasn’t buying smashed avocado for 19 bucks and four coffees at $4 each”.

During the brutal smackdown, which caused outrage, he also told millennials to get realistic about their expectations.

“There is no question we are at a point now where the expectations of younger people are very, very high,” he told 60 Minutes.

“They want to eat out every day, they want to travel to Europe every year. This generation is watching the Kardashians and thinking that’s normal. Thinking that owning a Bentley is normal, that owning a BMW is normal.”

Mobs of millennials slammed him, claiming the property market has changed drastically in the 15 years since he entered it. Many also said he was just lucky enough to make an investment because his grandfather lent him $34,000.

But Mr Gurner told news.com.au he made a number of personal sacrifices to climb the property ladder and it was “actually incorrect” he had help to get into the property market.

“It was incredibly difficult,” he said.

“My first investment property was an apartment bought for $180k in St Kilda and I was fortunate enough to have my boss at the time approach me to renovate it while he fronted up the money.

“I spent every night on my hands and knees sanding back the floors, painting, renovating and working on the house. When we sold it, I used the small profits of $12,000 to purchase my next property and it all grew from there. The most important thing for me was just to get my foot in the door at the absolute base level, and work my way up from there.

“I sacrificed a huge amount through those years, working multiple jobs, seven days a week and I saved absolutely every penny that I could.”

After making $12,000 from his first investment property at 18, he took out a $150,000 loan using the $34,000 from his grandfather.

He said he approached his grandfather with a business proposal and used the $34,000 for equity so he could obtain the loan.

He bought a gym, renovated it, and sold it a year later to a competitor. His Gurner company now has 5000 apartments worth $2.7 billion on its books.

While he’s now a huge success, he said starting out in the property business took a huge toll on him.

“It was a huge risk and I worked round the clock from 6am to 11pm every night in order to pay back the loan and ensure the business was a success,” he told news.com.au.

“They were also the darkest and hardest days of my life — I was only 18 and had just taken on a huge personal loan and needed to stop at nothing to ensure I didn’t go under.”

The property tycoon claims not all his comments were heard during his appearance on 60 Minutes on Sunday night and was disappointed “trivial” comments overshadowed the important issue of housing affordability.

Mr Gurner said he did not expect the backlash, with some suggesting he was just lucky.

“I was on 60 Minutes to focus on a really important issue about housing affordability and the comments were part of a much bigger discussion on how people can get into the market and the necessary planning and policy regulations that I believe are required in order to generate any real change,” he told news.com.au.

“I think it’s incredibly hard for people to get into the market. House prices are expensive, however while our economy is so strong and population growth set to continue, this is the new reality for Australians.

“If the government is serious about housing affordability we should be looking at policies that are supply-driven, and not about fuelling more demand.”

Mr Gurner was ranked 157 on this year’s Financial Review Rich List after making $473 million in 10 years.

Mr Gurner told 60 Minutes there was “no question” many young people today were blowing their money on a lifestyle, then whingeing about homes being too expensive.

“You’re not going to get a house in Camberwell for $700,000, you’re not going to get one in Alexandria in Sydney, you’re not going to get one in Newstead in Brisbane. I mean the market has changed,” he said.

“I think until this generation realises that the people that own homes today worked very, very hard for it, saved every dollar, did everything they could to get up the property ladder (they won’t get ahead).

“You might have to buy an investment property first, you might have to share with mum and dad, you might have to buy with a friend, but you’ve got to get your foot in the door and you’ve got to slowly get up the ladder.”

After news.com.au crunched the numbers following Mr Gurner’s 60 Minutes appearance, it was discovered young people could potentially save $34,000 in four years if they gave up a number of life’s luxuries, including smashed avo and coffee.