What's in the Episode:
Join us in today’s episode where I’ll be speaking to Duong about his early life and motivations, including his parents encouragement to invest in property. We learn about the Queensland investment
blunder he regrets, the best advice he’s ever received in his journey, and much much more!Timestamps:
2:23 - Duong is always aiming for growth in his business.
6:31 - Duong has always based himself in the western sydney area.
7:53 - ‘the first pick is not always the end pick’
9:11 - Duong is grateful for his parents pushing him into saving for property.
11:54 - After dropping out of uni, duong worked with his mum before deciding once again to study. this time he went into construction.
14:55 - Duong took a leap of faith and quit his job in order to put everything into his business.
17:40 - All you need to start up is a telephone.
20:38 - Duong believes in the value of his product, therefore it is easy for him to sell.
Resources and Links:
[00:10:11] ‘If I'm getting this sort of value, and I can't believe how many people don't even know about this’. And I thought, ‘Well, I've got to help others do it. Yeah, why not? Let's unlock the secret to thousands of other investors based in Western Sydney, and probably based all over Australia, like I was, that don't know about this’.
This is Property Investory where we talk to successful property investors to find out more about their stories, mindset and strategies.
I’m Tyrone Shum and in this episode we’re speaking with successful investor and founder of Duo Tax Quantity Surveyors, Tuan Duong. After being unsure of his path early in life, his parents persuaded him into the world of property which led to him purchasing his first property at the young age of 24. Join us as we uncover the story behind his success!
**END INTRO MUSIC**
**START BACKGROUND MUSIC**
Tuan Duong started as a self-described ‘one man band’ back in 2015 and encountered bumps along the road, but is now living a very different life thanks to his business skills, and advice from those closest to him.
[00:00:27] I'm the principal and founder of Duo Tax Quantity Surveyors, which is a property tax depreciation expert firm, we specialise purely on advising on property tax depreciation for property investors who want to maximise the amount of tax deductions possible from their investment property. And that's where my journey comes in. I found a lot of value in this, and hence, it's my now lifelong pursuit to help others unlock these tax deductions that I wasn't aware of a long, long time ago.
So what does a typical day look like for him?
[00:01:27] The company has grown from a one man band—I was literally a one man band when I started this business five years ago. And so when you start out, I was mostly looking after trying to grow the business in the sense of sales. Also, the technical know-how.
[00:01:45] I was very limited in what I knew about depreciation, when I had started it was quite a new thing to me, as much as I knew the fundamentals of it, but being able to implement technical data into a system that could be replicated to our customers, in a very big scale, I had to grow the business from there with limited resources in terms of trying to build Excel spreadsheets. And then so the next day would be to find more sales to sustain some traction in terms of financial growth.
DUONG IS ALWAYS AIMING FOR GROWTH IN HIS BUSINESS.
[00:02:23] And so that was my day-to-day running of the business when I first started. And then it became looking for stuff here and there when I could afford it. But nowadays, we've got a sort of sales support team that helps clients and customers get the most out of what our product offers. So that means I'm training staff in terms of sales, but also technical. And I'm also always trying to bring onboard new staff to join our business, as I'm always trying to be in a growth phase, we're very much in a growth phase of our business.
[00:03:00] And so always looking for ways to build efficiencies as well into our day-to-day activities. And so that forms most of my day to day, so relatively different to what it was five years ago. But I guess that's the journey of every business owner, evolving to somebody that you're doing the things that you love to do. And the things that you can't do or you find too hard, like bookkeeping, you outsource that. Thank God for that!
To get to know Duong on a deeper level, I ask him to delve into his personal history, starting with where he grew up.
[00:04:14] I'm a second generation Australian. Mum and Dad had left Vietnam by boat back in 1984. And so by 1986, they had made their way to Australia, and settled here. And I was born in Auburn, back in 1986, which brings me to 34 years young this year. I grew up most of my life in Cabramatta, which is one of the western suburbs of Sydney.
[00:04:48] And so through there, I went to school at a local Catholic school, and I then eventually moved further out west to a suburb called Bonnyrigg where I schooled at another Catholic high school, and that was my journey. And then from there sort of got brought up in the Western Sydney area. I saw a lot of geographical change, for one, but also the economy just thrived from stride to stride over the course of 30 years before I moved down to the area where I'm based now, in the Inner West of Sydney.
DUONG HAS ALWAYS BASED HIMSELF IN THE WESTERN SYDNEY AREA.
Duong has remained in the Western Sydney area throughout his life, both personally and professionally.
[00:06:31] But certainly it grew and taught me a lot about the demographic of that area that’s ever changing. And I think still today I'm very associated with Western Sydney; I'm in the running for the Western Sydney awards for Business Excellence for two categories. So I'm very much aware of what it is and what's happening in that area, especially with things like the airport, and the ever changing demographic, and it's just expanding at an increasingly rapid rate. And to be honest, I invest in that area for that very reason. I hold property in the West of Sydney.
He describes his life throughout high school and into his years at university.
[00:06:44] In high school, I very much had an interest in business and economics studies, that was where I was very much interested in trying to grow myself and understand that side of things. And the reason for that is my mum and dad being first generation here, they are Vietnamese, they ended up starting up Vietnamese restaurants for themselves. So they were always working for themselves for most of my young life.
[00:07:19] And so I really looked up to them for that, which meant that going from there, I ended up moving into uni. Once I finished school, I went to study finance and mathematics, which was something I thought that I would have interest in, but not to be. And then the funny thing about that is, I hear now the first pick is not always the end pick. And I ended up dropping out of university to work with Mum. And so I said, you know what, I wasn't excited about uni.
‘THE FIRST PICK IS NOT ALWAYS THE END PICK’
[00:07:53] I went to work with Mum at our family restaurant for a short period when we started doing fit outs. And that's where I came across someone that was undertaking construction or project management of our fit out. And I said, ‘what are you studying?’ He said to me, ‘Construction management’. And so I thought, ‘Oh, this is amazing. I can't believe the diversity in his role, and how much of an interesting role he had to play in the fit out and construction process of that’.
This was a pivotal moment for Duong.
[00:08:25] And I thought, ‘Well, you know what, that’s something I wouldn't mind doing’. So I took that up as my journey to go into construction management. And that's where I sort of got my background to become a quantity surveyor, because part of that degree allows you to be a quantity surveyor. And I had, I would say, limited interest in quantity surveying—it wasn't the most exciting subject at uni.
[00:08:46] But what I found at a later stage throughout life is when I came across investing in property, which my mum and dad always sort of pushed me towards, and thank God you know, it’s always someone that gives you a shove in the back and says, ‘you’ve got to get going, you can't be spending your money at the club, at the pub or whatever it might be having a good time with your friends, it can only take you so far.’
DUONG IS GRATEFUL FOR HIS PARENTS PUSHING HIM INTO SAVING FOR PROPERTY.
[00:09:11] So that's when I started investing in property and my accountant said to me, ‘Well Tuan, investing in property means you should be able to claim depreciation. And that means going to see a quantity surveyor to help you get the most out of your rental property and claim some depreciation’. I said, ‘Well, I studied quantity surveying in school’. And he said, ’Well, no, you've got to actually go see a qualified quantity surveyor that's got the expertise in providing this type of advice that gives me, the accountant, a report to say this is how much you can claim in depreciation, which then in turn is a tax deduction’.
[00:09:47] And that was lowering my taxable income each financial year up to 40 years on my brand new townhouse that I bought, and for me it was like, ‘This is a no brainer’. I can't believe how much value I was getting out of it. I mean, I was on a basic $60,000 income 10 years ago, when I graduated, I thought, ‘I've got this rental property. I've got a $15,000 tax deduction in the first year’. And it was like a $6,000, $7,000 refund.
[00:10:16] I just could not believe it. And then that was a no brainer. Like, ‘If I'm getting this sort of value, and I can't believe how many people don't even know about this’. And I thought, ‘Well, I've got to go help others do it. Yeah, why not? Let's unlock the secret to thousands of other investors based in Western Sydney, and probably based all over Australia, like I was, that don't know about this’. It's been rewarding to meet that many people that I'm able to help.
**PROPERTY INVESTING JOURNEY**
Duong started on the construction side of things before he eventually came around to investing.
[00:11:29] University... didn’t quite finish. I ended up working with Mum where she was constructing a new restaurant, this was an age of probably, I think I would have been 21 [or] 22 at that time. Then I went to a four year degree to study construction. I graduated, I worked in construction for five years or four years post grad, I had a couple of years under my belt while I was studying as well.
AFTER DROPPING OUT OF UNI, DUONG WORKED WITH HIS MUM BEFORE DECIDING ONCE AGAIN TO STUDY. THIS TIME HE WENT INTO CONSTRUCTION.
[00:11:54] So that's where I was in construction, but I wasn't on the quantity surveying side and quantity surveying is, in the traditional sense, being a building economist. And that means that quantity surveyors understand the metrics of construction when it comes to dollars and cents. They're like the accountants of the construction world.
[00:12:14] So they're independently advising the bank, the Council, the tax office, on what exactly is the construction cost for its certain type of building. Every nut and bolt, working out square metres of concrete, plasterboard, the labour, manpower required, and what that means in terms of dollars and cents for a construction project. And that's what a quantity surveyor would do to provide that independent advice, whether you are a developer or whatnot.
He considered putting his money towards his biggest passion at the time, until a talk with his family changed everything.
[00:12:39] So when I was growing up, I was doing construction, civil construction, that was building roads, bridges, that sort of work, post grad. And after about four years, it was in that period where I worked with Mum to get into the construction degree. But then while I was working, I then saved up enough money to buy my first investment property.
[00:13:01] Of course, at that time, I'm such a big passionate person when it comes to cars and things like that. But Mum and Dad said, ‘No, this is not the way. You've got to grow wealth’. And the way to grow wealth—from what they knew, because they were first generation settlers, migrants—they knew that in Australia, property just had its merits when it came to wanting to build wealth. They didn't know about shares, I never really got inspired or really educated about shares and how to buy shares and where to put your money, but property was one of those things and it still is today.
[00:13:38] I've seen lots of migrants and their children go ahead and buy property and even their parents are buying property. Like my parents, they didn't have a lot of money to buy a property or invest in property, but they knew that, and it's something that they always wanted for their kids.
Duong describes when he first moved into investing in property with help from his parents.
[00:13:53] So my first investment property, they chipped in a bit, and I chipped in a bit to buy my first rental property. And that's when it became evident to me that this is something you need to do, you need to have. So once I organised the report, bought a property organiser report, it was a no brainer.
[00:14:11] I decided that you know what, this is really important. Like, I can't believe how much value this adds. So then I… to be honest with you, it's not that easy starting out. You always have a bit of an ooh and aah moment, ‘Should I? Could I? What if?’ Every year as a professional, as most people out there listening know, in your professional career, if you're in that career, you've always got this opportunity to increase your wealth by, you know, that pay rise and that little bit more.
[00:14:42] And that always helped keep me back. It always kept me back from having that drive to leave work and say, ‘You know what, I need to take initiative here and start my business if I'm really driven to do so’.
When he quit his job in construction engineering, he began to work harder than ever.
DUONG TOOK A LEAP OF FAITH AND QUIT HIS JOB IN ORDER TO PUT EVERYTHING INTO HIS BUSINESS.
[00:14:55] And so that was at the age of, I would say, 26, I think it was 25 [or] 26, that I bought my property, my first property at 25 [or] 26, which was about $400,000. And it was a Western Suburbs townhouse. It was brand new. And then from there, it took me about two and a half years to really say, ‘You know what, I'm gonna do it’. And so I had a big holiday one time with a couple of mates, came back and said, ‘That's it, I've got to leave’.
[00:15:22] And I was at a good place in my career, but two years of oohing and aahing, you know, wondering, I put that curiosity to rest. And I took that leap of faith, and I decided to fly solo, as they say, and never looked back. But once I started though, I resigned from my construction engineering role. I then went into a quantity surveying firm. And there I actually said to them, ‘Look, I'm going to work for you for free. I just want to work, I just want experience’.
[00:15:56] And so I worked there for a period of, I think, just over 12 months. And I worked for two other employers at the same time. So I was employed in three different jobs in three different quantity surveying jobs. I work for someone on the weekdays, I work for another person, like doing contract work, on the weeknights, and on the weekends, I would be out doing inspection for tax depreciation with one other employer. So I was keen, to say the least. So that's where after 12 months, I said, ‘You know what, I really am eager to start.’
Duong remembers the time he was just starting out in his business, when he was working from the study in his parents house.
[00:16:23] The market was so hot back in 2015. I knew I just had to get out there and meet investors. I didn’t know how. I did what they call a survey, I decided to do a bit of a bit of R&D [research and development], if you can call it that. I asked my personal accountant, who was a guy sort of local to me in Canley Heights. I said, ‘Would you refer me to clients if I started doing tax depreciation?’ He said, ‘Of course I would’. And that was, for me, enough for me to say, ‘I'm gonna give it a crack’.
[00:17:05] So that's how it started for me. And that was back, five years ago, so I would have been 28 when I started. So there were a few years there of oohing and aahing, and then about 14 months of career work inside a couple of quantity surveying firms. And then that's when I started, at the age of 28, to start my business. Now, my business was not all that glorious, it was started in my parents’ house. So they had a little study and that's where I sort of started up.
ALL YOU NEED TO START UP IS A TELEPHONE.
[00:17:40] And I'm sure a lot of people can resonate when they're listening to this podcast, working from home thinking, ‘Wow, this is exactly the type of office you can start in.’ You don't need anything more special than this. You just need a telephone. And I remember I created a business card. And I designed it myself, because I was quite savvy with AutoCAD and being able to use Adobe software.
[00:18:02] So I created a business card, I thought it was quite, you know, beautiful. And I said, ‘I need a landline and make it look professional’. So I said to my mum, ‘Mum, do you need that fax line that we have at home?’ And she goes, ‘No, no, it's all yours, you can go for it.’
With that, Duong was up and running.
[00:18:15] So I switched that backslide to a landline. And then I put it into the card. And that became my landline for the business and with my phone number as well. And then off I went into some networking events that some friends told me about and I just started selling. You wouldn't believe when you start, the amount of people that you don't know will give you a chance in life. There are so many of them out there that are just willing to give you a chance, if you can just be honest with them.
[00:18:46] I don't know everything, but I’m making a start. And it's a very important thing. Because you know, it's always that fear of like, ‘Oh, am I good enough? Do I really know what I'm doing?’ Just start, you know, and people will have faith in you. And you will make mistakes, you know, there's going to be reports that don't seem quite right. And the accountant has to come back and tell you this is not right. I've had a lot of that feedback over the years, and even today, I prepare reports.
[00:19:13] And there's always someone critiquing my reports that are really, really interested in the way it looks or the way it presents. And they say, ‘Oh, would be nice if you had this, if we had that’. And so it's an ever changing process, and you're always growing and that's what helps perfect what you do. And when you only do tax depreciation, you become really, really good at it, especially on the scale that we do it now.
Duong’s personality and characteristics helped him advance in his career.
[00:20:05] I think it's very suited to my characteristics, because I've never been a salesman. I've been a technician all my life when it comes to construction, cost estimation, working as an engineer… and so having to provide a product that you don't have to truly dig deep to sell, it almost sells itself, it's so natural for my character. And so I felt inclined that this is something that I could actually confidently do without much trouble.
DUONG BELIEVES IN THE VALUE OF HIS PRODUCT, THEREFORE IT IS EASY FOR HIM TO SELL.
[00:20:38] And today, as much as I train staff to sell, I tell them, ‘You don't need to sell yourself, it's almost like you just tell them—inform them—of how much value you can offer them in terms of a product. And that will resonate through to them, and it should sell itself in that regard’. So it's not like you're gonna have to sell pens. So very different to a Jordan Belfort sort of spec of sales.
He had a very hardworking family. I asked him where his drive came from, seeing as in his parents’ generation people, especially immigrants, weren’t as well-educated as they are today.
[00:22:34] I wrote an article about this not long ago, especially for some of the awards that we've been finalists and listed for. It talks about where the drive came from, and it resonates with me, because when my parents came here, education was so limited. The only thing that they know is what others are doing. And when I look at my closest aunties and uncles, they were all trying to save money, buy property.
[00:23:06] And for Mum and Dad, it wasn't actually buying property, they bought a rental property years ago. And I think it was back in the early 2000s. And they had not done very well out of that rental property. So if anything, it was probably a little bit discouraging for them on that first rental property they had ever bought. And of course, interest rates are high, and all those sort of things that factored into it, it wasn't going their way, and then came 2008 [or] 2009, interest rates started to drop.
[00:23:34] And this is where my mum and dad said, ‘Well, you know, let's start buying property for our kids.’ So their business was successful to some extent, but not enough for them to have a thriving portfolio of properties. But it was always a passion for them, because they knew that everyone else was doing it, so there must be something with this that people are doing, that they're doing right.
Duong’s parents took the plunge, and helped his sister do the same.
[00:23:58] And it could come down to where she bought. I mean, it wasn't the best, or most glamorous suburb that she bought her first rental property. But when she bought, she helped my sister with the first property that my sister bought, it was in a thriving area, known as Canley Heights. And at that time, interest rates were low. And it was just a great place to start. And I think that's when, for us, we were surrounded by talks of property.
DUONG WAS IMMERSED IN THE WORLD OF PROPERTY.
[00:24:27] Everyone's talking about property in late 2000, you know, close to 2010. And when I bought my first property in 2010, that's when it became a thing, and it just sort of was filling our space when it came to it, and friends were buying, you know, and I think it's all to do with the affordability of property, too, being interest rates were lower than usual. And of course, the flexibility of banks, I think at that time was vastly different to the era before that. So in terms of background, it wasn't something that we had a lot of experience in.
Despite his lack of experience, Duong kept it up and found that the more he invested the easier it became.
[00:25:09] But for me, it's been a bit of a learning curve and being able to meet people, even like yourself, Tyrone, that helps, because then you start listening to people. I had a lot of people in our family that were mortgage brokers, our family had a few establishments in businesses there. And it was always resonating about property and how easy it is to lend money at that time. And it only got easier, if anything, for the most part, right. And that's where my journey started.
He shares his thoughts and experiences when it comes to renting versus buying.
[00:26:05] I've got this mentality of Mum and Dad, who, as much as they rented when they first settled in Australia, from there, they've always bought the houses they live in. They’ve always bought and had this idealism of ‘renting is bad’. But there's always an economy for both. But based on that ideology, I realised that for myself, now, when I buy, even my own businesses, I buy the property premises that I occupy the spacing.
[00:26:35] So it's almost ingrained in us that it's the way we should be, and now, every time I move out of an office, this is our third office that we've grown into, we've bought every office that that we've occupied, and all because I've got this stigma that you need to owner occupy the premises. And now we accumulate these commercial properties in the process. Not a bad thing at all.
Duong bought his first property at the age of 24.
[00:27:37] The first property wasn't through a buyer's agent, I wasn't that fortunate. It was sort of like, ‘We know the area’. It's always that, isn’t it? Your property when you start out, you buy somewhere where you're comfortable. And you think there's real good aspects to it. And there's a real opportunity for capital growth.
[00:27:53] You think this is a thriving area. The demand was crazy in the area of Canley Heights. I'm not sure the listeners know where Canley Heights is. But definitely, it's a very Asian centric community similar to Cabramatta. But it's a little bit more upmarket, in terms of, it has a little bit more space, not as dense, but really thriving restaurants at that time. If you go there today it's just impossible to drive through Canley Vale Road. It's a thriving, thriving little area.
[00:28:28] And so it ticked all the boxes for us, because we were so familiar with the area we knew it was getting busy, had great restaurants, people wanted to be there, daytime, evenings. And so it was just an amazing place to invest in. So I bought the first investment property in Canley Heights back in 2010. And that's when I started having to delve into, you know, what are things that you can claim, what are the things you can't claim, expenses, what's depreciable.
THE BEST ADVICE HE EVER RECEIVED WAS TO GET AN ACCOUNTANT.
[00:29:00] And that's the advice I started getting with an accountant, it was the first time I ever had to engage an accountant. Years before that I used to get my accounting mate to sit next to me and try to tick and flick some boxes on my e-tax, and try to do a tax return. But I think at that stage, once you invest in your first property, that's when it's such good value. And thank God that I did, and obviously through the advice of Mum and Dad, and even my sister who had bought a property the year before, and she said, ‘Look, you need to go see an accountant’. So I did. And that was the best advice ever.
He expands on how this advice has helped him thrive.
[00:29:31] For me it's a no brainer, whatever that $150 or $250 worth of tax expense, on seeing a tax agent, it provided immense value because then you learn about depreciation, you learned about council rates, you learned about what you can claim on water rates, usage, and things like that. So, things like that. I was very blessed to start that journey. And from 2010 I didn't buy any more property until 2015 when I started my business, and I wasn't very savvy and obviously in that five years I understood capital growth and then I refinanced my house, and my first rental property to buy my second.
[00:30:09] And this is where I have to sort of slow down to explain that the second property I bought was through a more of a project marketing company, I bought an apartment in Queensland. And now looking back, it's probably one of my downfalls of investing in property. And I was taken to a property seminar, and I was sold a dream. I'm sure many people out there can resonate with this. And so I made a bit of a mistake where I bought that property in 2015. And I sold that property in 2019. At a bit of a loss.
[00:30:48] I sold it for exactly what I bought it for, but of course, there's things like stamp duty that you have to consider, and holding costs over the three years. And that took a couple years to build, but by the time it was built, it was something I just didn't want to let go of. And for other people that bought in the same premises that I knew, they were all about the hold and hold, and see where it goes. But it wasn't for me. For me, I thought, you know what, it's equity that I could release.
SYDNEY HAS ALL THE RIGHT INGREDIENTS FOR GROWTH.
[00:31:18] And I could do better things with. And I ended up doing exactly that. And you've got to make that call sometimes, I think, when you're investing in property, and sort of sitting and holding seems to be easy to do, but truth be told, that money can always be better spent elsewhere. And that's exactly what I did. And I now have a couple of investment properties which I ended up buying in 2019, out West, in areas like Austral, and Jordan Springs, I really truly believe in these areas, because Sydney has all the right recipe for growth.
[00:31:53] And the demand for property and the demand for land in Sydney I feel is ever changing. And out of just the last 12 months, I've seen, I think more than 10% growth in just these areas. And it's taken me almost a year to build growth. And my first investment property was brand new. And so I had this stigma that I want to buy a brand new because of the low maintenance. And in my position of being a business owner, I don't want to be dealing with problems such as you know, mechanical, or whatever it might be, drainage issues.
[00:32:30] So I've just bought brand new properties from the get go. And they seem to be very, very good in terms of having to spend time on it. And having a property manager to manage it without any sort of intervention from me, which is fantastic for me. And having that growth of 12 to 15% over the last 12 months has been amazing. Probably a little bit exaggerated because of, you know, the builders grant now. And everybody's demanding properties that are brand new, especially house and land. It's just crazy.
[00:32:59] But that's not a bad thing. You know, people want to get ahead in these western regions. I grew up out west in Cecil Hills. That’s where I ended up living with Mum and Dad for the latter part of my life being with them. I grew up in Cecil Hills, which is sort of surrounded by Badgerys Creek, Austral. And that's the reason why I've invested there because I really believe that that community around there, they are all about that house and land, owning your own home dream.
[00:33:27] And areas where people are owner occupiers, I think are great for investment because people aspire to live there. And so there's people that want to rent there, they're willing to pay rent to be there. So that's what I found. And for what is a strange economy I finished construction on one of my premises in just this year, around mid-year. And I was able to get tenants there in the first couple of weeks after an occupation certificate was received, which means despite the economic conditions, it's still got huge demand, which is great.
Thank you so much to Tuan Duong, our guest on this episode. If you’ve enjoyed hearing Duong’s story, join us next time, where we hear more about his investment regrets.
(1:50) And I think I wish I had known about things, like the Property Investory Podcast, at that time, you know, there were those independent places where you could get advice, and not have to make that mistake.
We learn about his business in its early stages.
(4:31) So very lean, but very fortunate, to come across people that will allow that and you know, you've gotta start somewhere, it wasn't the most glamorous office, you know, it had a few bug issues.
Duong shares his successful investment stories and explains where he went right.
(8:35) I bought that property for $400,000. It's probably worth double that now, the duplex I bought.