Glaswegian Jess Denholm's Foray into property investment was originally motivated by a desire to retire at age 45. While she didn’t quite hit that goal, now aged 50 she has built an impressive Kiwi rental property portfolio with partner Carmel Carroll.

A sense of Scots’ canniness has stood Denholm in good stead, with her early goal put in place only so she could kick back and enjoy life with Carroll and their daughter Morgan (15). But a passion for property means Denholm missed the cut-off date.

A love of the game is why she found herself still on the investment scene in her late 40s. Having just turned 50, however, she’s adamant that it’s now truly over. Is it really?

“It’s so much fun and so satisfying, it almost feels like an addiction,” she laughs. “I even suggest to my tenants that they should aim to become landlords one day!”

Understanding Tenants

After arriving from Scotland in 1991, Denholm worked first for the prison service, then for many years in the social housing sector while New Zealandborn Carroll, a successful opera singer, is currently teaching music at St Mary’s School in Auckland.

Denholm’s time in the social housing sector taught her a lot about tenants’ wants and requirements.

“I think I understand people’s housing needs,” Denholm says. “And I know what they prefer to live in. I’ve been involved with a number of special housing projects here and in Wellington, which had accommodation designed for the elderly, the disabled, big families and small families.”

Recently Denholm has been working with the Dingle Trust which helps young people who have been in care and assists them to take their place in the community.

“When they’re discharged from care it’s important to put them in the right sort of house and to be realistic in your expectations. You don’t want to set them up to fail.

“We actually had mentoring programmes designed, to show young people how to be good tenants.”

Long Journey

The pair became involved in real estate when Carmel and two others bought a house 22 years ago in Grey Lynn.

“It’s interesting,” Denholm says, “Eventually, one person bought the others out and she’s still there. Obviously the value of the place has increased phenomenally since then. The other person built a house nearby and I’d imagine that’s done well for him too.”

It's important to put them in the right sort of house and to be realistic in your expectations. You don't want to set them up to fail - Jess Denholm

She figures that all three are probably sitting on approximately the same amount now in terms of assets. While she and Carmel have bought and sold numerous times over the years, they wouldn’t change their approach.

“We bought our first house together in Birkdale in 1995 and we paid $121,000. Of course it felt like a fortune at the time!” she says.

The pair was married at that house, so it has special significance to them; they held on to it for 20 years.

Following the successful Birkdale purchase they were keen to buy more property, but fronting up to a number of banks, they found all were less than helpful.

“We had the assets and equity but they made it so tough all the same and three declined us a loan. These days we use our wonderful mortgage broker Christine Lockie, which means things are much less stressful.”

Finally, the banks did play ball, so with $120,000 in hand to “go again”, and eager to spread their assets beyond Auckland, Denholm and Carroll found themselves looking in Huntly, south of Auckland, where house prices were comparatively low.

Denholm describes this experience as an eye-opener. “We bought a miner’s cottage on one side of the river and a standard home on the other. We simply stepped up and offered $60,000 for each one and the offers were accepted.

“The miner’s cottage was cute and cosy and attracted great tenants, but the house in town didn’t fare so well. It suffered quite a lot in terms of wear and tear over the 10 years in which we owned it.”

A couple of years later in 1997, when Denholm’s sister needed to leave Scotland, the pair bought a leasehold house in St Johns, Auckland for her to live in.

“We knew it wasn’t going to make us much, if anything, but it served its purpose in a family sense,” she says.

They added a minor dwelling to their Birkdale property in 1999, before leaving for five years, when they lived and worked in the United Kingdom.

“Of course we bought and sold there, too,” Denholm says, “But only once!”

Am Ambitious Plan

Back in New Zealand in 2004, and inspired by a book entitled Building Wealth by Jan Somers and Dolf De Roos, Denholm and Carroll – who she describes as one of life’s great organisers – put a plan in place: to own 10 properties within 10 years.

The next year was a big one. The pair bought a leasehold home and therefore an inexpensive house in Glendowie to live in, sold the Huntly houses, one for $188,000, the other for $179,000 and bought a Glen Innes investment property for $410,000 on which they now have three dwellings, bringing in $1220 per week. They also sold the St Johns home for more or less what they’d paid for it.

It was around this time that Denholm found herself lost, returning from a meeting in South Auckland.

Stopping to find her map book, (pre- GPS) she parked outside an attractive corner section home in Otahuhu with a pool, park views and a generally good vibe. She could imagine living there – and it was for sale.

Eventually Denholm found her way home, excited about this new proposition, but Carroll said firmly that it wasn’t the time for buying their dream property. They had a plan to stick to.

Another investment property in Waiotaki Bay was soon added to the portfolio, then a couple of years later, as the plan was going well, by utter coincidence, the Otahuhu house came back on the market. They had recently sold in Kohimarama, so this time the pair bought it.

The Waiotaki Bay house was sold the next year and with the purchase of a Manurewa property with potential for a minor dwelling, in 2012, their goal of 10 properties was reached – three years early.

Moved On

Finally, in 2015, Denholm and Carroll sold the original Birkdale property. “It was sad but you have to move on,” Denholm says.

Though sentimental about certain properties, the couple find most fulfilling the practical support they have been able to give throughout their careers as landlords.

Some tenants have been with them for years and are practically a part of the family, including one girl who came to live in one of their properties with her parents, aged 10 and is now 18 and expecting her own baby.

Denholm and Carroll are moving her soon-to-be extended family from their two-bedroom unit on the site at Glen Innes to a three-bedroom house.

“They’re going to need space for the new, wee baby,” Denholm says.

“We feel privileged to have been part of these people’s lives and we are in a financial position to help if it’s needed. If somebody has had to buy a school uniform or has some other unexpected expense, we’ll always work with them in terms of paying the rent.”

Inevitably, Denholm and Carroll have occasionally had bad tenants; Denholm remembers one in particular, who badly damaged a beautiful original wooden floor by dragging furniture across it, yet the tenancy tribunal insisted on taking depreciation into account in their decision.

“It’s a heritage floor; it doesn’t depreciate." Denholm says, who despite this tends to take most things in her very energetic stride. That energy has already fuelled a flurry of retirement activities, among them a sky-dive – her first –and a holiday in Queenstown.

She attends the gym five times a week and walks her dogs in the park across the road. A black belt in Tae Kwon Do, she’s recently started learning karate with daughter Morgan, as well as taking up boxing again.

We feel privileged to have been part of these people's lives and we are in a financial position to help if it's needed. - Jess Denholm

More The Merrier

“We’ve got hens for the first time and we are loving them. Everyone should have some,” she says.

The Otahuhu house they are now living in has proved perfect for Denholm, Carroll and Morgan, who’ve been joined by nine-year-old foster daughter Maia – plus a German home-stay student.

“The more the merrier,” Denholm says. With a smaller portfolio now, consisting of their home, the three dwellings at Glen Innes and the Manurewa property which is soon to have another house moved onto the section, there’s just enough to keep Denholm busy, attending to tenants and maintenance issues.

Out the back of their section sits Denholm’s pride and joy – a camper-van – her retirement present to herself.

“So far my retirement’s been so busy I haven’t had time for anything extra but the idea is to go tiki-touring and really explore New Zealand.

“Property investment has been the very best thing possible for us and it’s brought lots of new challenges and opportunities. We both enjoy the process of planning carefully in order to increase our yield, and overall, there’s really nothing that we’d have done differently.”