A Unique Approach to Financial Planning for the Next Generation
A father from Melbourne has taken an unconventional approach to securing his daughter’s financial future by purchasing a $370,000 two-bedroom unit in Footscray, a trendy inner-city suburb. Jordan Veleski, 37, and his wife Kaitlin decided to use the money gifted to their daughter, Florence, on her first birthday as a deposit for the property. The couple supplemented the initial amount with their own savings and equity from other properties they own.
Florence received $25,000 in cash from friends and relatives during her first birthday and christening. This generous gift inspired the couple to invest in real estate for their daughter. The decision was not made lightly; it involved careful planning and research. Mr. Veleski emphasized that this was not a random choice but rather a calculated move based on data and market trends.
The property is currently rented out at $470 per week, providing a 6.6% yield. It is also neutrally geared, meaning that the family does not incur any additional costs to maintain the property. This strategy allows them to generate income while building equity for Florence’s future.
Mr. Veleski, who founded The Flo Buyers Agency after leaving the construction industry, has shared his insights on property investment with others. However, he acknowledges that public reactions have been mixed. While some people support his approach, others are skeptical. He believes that many people outside of his circle do not fully understand the complexities behind such investments.
“Educate yourself,” he advises those who question his decision. “This isn’t just picking a place on a map and buying a property. I spent months researching and finding what I thought was the best area and why it suited us.”
He also points out that this method has proven effective since the pandemic and economic downturns. “If you know what you’re doing and where to buy, it’s a pretty foolproof plan,” he said.
The location of Florence’s unit adds to its appeal. It is situated near the newly upgraded $1.5 billion Footscray Hospital, which ensures strong rental demand from hospital staff. This strategic placement enhances the property’s value and potential for long-term growth.
Mr. Veleski himself has a history of smart investments. He purchased his first home at 21 with $30,000 gifted to him at his christening, which was safeguarded by his parents. He notes that Florence will have access to her equity much earlier than he did.
“I’ve been honest about that,” he said. “When I decide to sell the property, I will give her all the money. I don’t need to keep it. I’m just fast-tracking the process here, instead of her buying a home at 21 when house prices could be $3 million or $4 million.”
The couple’s younger son, Jordi, also received generous gifts on his first birthday and christening, which will be used for a similar investment. Mr. Veleski explained that investing in property offers more benefits than keeping the money in a savings account.
“The way prices keep going up, I thought it was the right and smart decision to put the money in property,” he said. “I think I’ve already been proven right.”
The property was recently valued at $415,000, showing a $45,000 increase over the past 14 months. According to Metropole Property Strategists, national dwelling values surged 1.1% in October, marking the strongest monthly gain since June 2023. The annual growth rate is now at 6.1%, indicating a new cycle of growth.
The median house price in Australia’s combined capital cities is now $1,091,134, while the average unit price in the capitals is $728,059. These figures highlight the ongoing trend of rising property values across the country.
Investing in real estate for children is becoming a growing trend among financially savvy parents. With property prices continuing to rise, many are looking for ways to secure their children’s financial futures early. Whether through direct purchases or trust funds, these strategies aim to provide long-term stability and opportunities for the next generation.