Theo Hancock flipped burgers for almost four years to save a $30,000 house deposit – and now, he plans to become a property mogul.
A teenager who bought his first property after saving his earnings from his after-school job at McDonald’s has revealed how he managed to get a foot on the property ladder.
Theo Hancock, who now lives in Auckland in New Zealand but who previously lived in Queensland, took to social media late last week to announce he had purchased an investment property – at the age of just 18.
He had snapped up a house in Whangārei in New Zealand’s North Island which cost $NZ280,000 ($A268,000) – a feat he described as a “big goal achieved” – and also said he planed to buy three properties per year moving forward.
The story of a teenage Macca’s worker-turned-property mogul quickly gained media attention, but also sparked backlash after it emerged Mr Hancock’s father had loaned him the rest of the money he needed, which meant he didn’t need to take out a traditional mortgage with a bank.
Welcome to Foot in the Door, news.com.au’s series on first-time homebuyers. Source: News Corp
Welcome to Foot in the Door, news.com.au’s series on first-time homebuyers. Source: News CorpSource:Supplied
But Mr Hancock told news.com.au some of the media attention he had gained since buying his home – which he plans to renovate himself – had been “misleading”.
He said the $NZ260,000 ($A249,000) debt he now owed his father was just as binding as a regular mortgage.
“What I have got is a mortgage with a 4 per cent interest per year owing currently that is to be repaid back – essentially I’ve got a giant debt strapped to me,” he said.
“A lot (of reports) make it out to be a ‘handout’ (but) while the terms are easier and Loan to Value (LVR) ratio restrictions don’t apply, it is still a mortgage.
“It’s a non-traditional, private mortgage basically – the lender just isn’t a bank.”
Mr Hancock said he planned to get another mortgage with a bank soon, and said he had worked hard at an Aussie McDonald’s restaurant to achieve his goal.
“Honestly (I) have worked for three and a half years on the Gold Coast in Queensland at Robina McDonald’s, usually doing 30-plus hours a week and even doing overnights from 10pm to 6am with school the same morning,” he said.
“I really worked my r*ng off to make $30,000 to put down as a deposit on this place (and then) obviously getting a mortgage to cover the rest.
Theo Hancock bought this house after working at McDonald’s for almost four years. Picture: Supplied
“I still work full time in Auckland (for) 42 hours a week to help pay back my loans and increase my affordability for my next (property).”
Mr Hancock said he now planned to purchase another two high-yield properties below market value which are “in need of some TLC” which the teen will then renovate himself to save costs.
He said he would be using the equity on his first property to fund the deposits needed via the banks for the next homes.
“If all goes well it’s a win-win for myself and my father as he is getting above banks’ rates on his money and he’s helped me get onto the property ladder as I’ve been planning for four years,” he said.
Mr Hancock also had some words of advice for budding young investors.
“My main advice for other young people is to set out a plan, have clear goals and a clear mindset, and if you work hard while you’re young and set yourself up for a good start, regardless of your goal, you can make things happen,” he said.
The teen’s story echoes that of Sydneysider Eddie Dilleen, who bought his first rental — a $138,000 unit on the NSW Central Coast — at the age of 19 while still earning just $500 a week working at McDonald’s.
He had saved all the way through high school for a $20,000 deposit, and amassed a 14-property-strong investment portfolio over eight years, valued at around $4 million.