When Ilse Wolfe was a little girl, she’d steal her parents’ shoes and sell them back to them for $2, along with a handmade bookmark. The aim was to raise money for lollies: an ingenious ploy, which not only worked, but presaged the birth of an entrepreneurial spirit.

Fast forward to 2021, and Wolfe is still finding ways in which to create wealth outside of the box. Her property portfolio, which is shared with her fiancé Taylor Green, is valued at $12 million and growing, and she is teaching her “cashflow hacking” secrets to others via Opes Accelerate Property Investment Programme.

But just five years ago, her property portfolio was languishing. She’d been forced back to work after a stint as a full-time property investor, due to an investment that offered good capital gains, but wasn’t paying its way. “I’d been so tunnel focussed on capital gains, and had attended a coaching programme to help me with this. But there was zero education on yield, the property [we’d] bought was generating negative cashflow, and we were getting dangerously close to the edge.” But like many mistakes in property investing, this was a catalyst for change. Over the course of the next year Wolfe would sell the poorly performing property, get some good advice, completely alter her strategy, and nut out a new approach that would change the trajectory of her property investment journey entirely.

Early Years

Growing up in New Plymouth, Wolfe didn’t have a “silver spoon” upbringing. Her mum was a Chinese woman from Malaysia, and her dad a Kiwi. They met in London and came back to New Zealand to live and raise a family.

While the family weren’t wealthy, they valued education. Wolfe says that there was a huge focus on academic success and it was taken for granted that she would attend university. She was a “nerdy academic”, attending University of Waikato and graduating with a Bachelor of Electronic Commerce. Even at this early stage, she realised that she would need an “X-factor” in order to stand out from the crowd.

“I realised that my contemporaries at university would be my competition when we graduated and were looking for work,” she explains.

“So, while people were working in retail while they studied, I was working as a writer for academics at the university, gaining experience and earning significantly more than anyone else.”

Post-study, she was given the only internship role for Microsoft in New Zealand. She then moved into an analyst role at Westpac, which allowed her to understand the finances of companies that dealt with property. And it was during this period that an interest in property was really fuelled.

“I was starting to realise that anyone who was successful either invested in property, or owned property in some capacity,” she shared. “These were the backing for their businesses or they were so successful, they could purchase amazing property.”

Then one of the bank’s clients (a partner at an accounting firm) showed her through a profit and loss statement on one of his properties.

“He took time out over his lunch break to educate me around this. It was so enlightening and made me realise I was missing out on something really important.”

After this chat Wolfe felt that she “had the will and knowledge” to move ahead in property investment. She was living in Hamilton at the time, and purchased two properties in the city with a 95% loan, before heading overseas on her “big OE”.

Renovation Success

The OE provided her with the opportunity to enjoy London life, and earn good money, but back home, the Hamilton houses weren’t paying their way.

“This was during the GFC, and the houses went into negative equity. I was having to top up the mortgage payments, and it took three or four years to get out of this hole,” she says.

When she moved back to New Zealand, she decided to convert them into home and incomes: post-renovation the homes brought in an extra $250 profit a week each.

She also bought a property in Papakura at the time, for what now seems a meagre $540,000, in 2013. She laughs when she remembers the reaction of locals. “I became the talk of the town! It was the first property in Papakura to sell for over $500,000.”

She would go on to rent out this property, which she was living in, when she moved to Luxembourg for work. But while there, she was rocked by a tragedy that would have life-changing ripple effects.

“When I was overseas my mother passed away. She was working on the Friday, and then died on a Sunday. I was traumatised. Mum had died without being able to retire. It made me realise I didn't want to work for someone else."

Change Of Focus

It was a copy of New Zealand Property Investor magazine that firmed up Wolfe’s determination to work full-time as an investor.

“In 2015 there was a case study of Jennifer Gautier who flicked a house in Mangere. She bought it, did a two month renovation, then put it on the market. I looked at the profit and loss on it and thought ‘I can do this’.”

Her fiancé Green was fully on board, and within weeks she purchased an “ugly house” in Mangere for $525,000. Green sold his half-share of a property owned with his sister and Wolfe used the equity in the Hamilton rentals as leverage for this new property.

Wolfe’s attention to detail came to the fore here. She made an in depth cost analysis of a renovation for the home, walking the aisles of Bunnings to budget for every nail. And alongside her father and brother (who’d returned from snowboarding overseas) she set about renovating the house, with the oversight of the builder.

Her reasons for this hands-on approach were multifaceted. “I was a young female and I didn’t want to be taken advantage of. I also wanted to be informed about the process and the technical side of things.”

The reno would cost $85,000 (she estimates it would have been $50k more if they’d used tradies) and admits to mistakes along the way – $15,000 spent on double glazing and she insulated and relined the garage, which did little to the value. But she would go on to rent the house for $575 a week to a tenant who has been there ever since. And due to Unitary Plan changes, the property is now valued at $1.2 million.

Purchases in Otara, Ellerslie, Grey Lynn and Remuera followed, but a “servicing handbrake” was about to
change her strategy.

Don't Forget The Yields

“We got to the point that we were spending $30,000 a year across three negatively geared properties,” Wolfe shares.

The houses she purchased weren’t paying their way. It was easy to miss, as she had a large level of revolving credit, and the negative cashflow didn’t really start to reveal itself for a year or so. But with her focus on capital gains, yields hadn’t been a big part of the equation. And she realised that if the properties weren’t earning enough to pay their mortgages, her ambitions would be stymied.

Wolfe and Green had just had their first child. When the baby turned one, Wolfe went back to work in a lucrative head-of-marketing role. Over this period, she was able to get the debt under control and reassess her strategy.

She undertook an assessment of her portfolio, and realised the Remuera property had to go. "The process involved assessing how I could pump up the capital gain and yield, then buying according to preset financial criteria, to know it would produce at least $20k net passive income annually, from the outset."

She called this "cashflow hacking"; using six principles to pump up the property’s potential: adding a bedroom, reassessing rental options, renovating the kitchen and bathroom, giving it a paint job, and sorting out the flooring.

It’s a way of adding distinction to existing properties. By doing this she says she is able to maximise the potential now, rather than wait for capital gains in some distant future time.

She did her homework as well; reading up on the building code and looking for exemptions that she could make work in her favour.

With a policy of buying within two hours of Auckland, she now has 15 properties in Auckland, Whangarei and Hamilton (all holds) that are bringing in at least $20,000 net profit each.

"I have calculated that I bring rents forward from 14 years ahead, based on the historic 4.8% annual rent average.

"All purchases since the 'crisis' have been manufactured into multi-income to achieve this.

"My annual performance goal is to buy three-four properties per annum, producing a total $100,000 increase to our passive income."

Bright Future

Wolfe’s strategy is paying off and she has no intention of slowing down. “I have a net wealth goal of $50 million and passive income goal of $2 million per annum." Her future goals are to master more complex investment strategies, build strong allies and long-term joint venture partners, develop her portfolio sites and keep challenging herself to go bolder and larger. And she wants to share with others.

“The more I learn, the more I can pass on to educate investors through my coaching programme.”

Whangarei Property

Here is an example of Wolfe's "cashflow hacking", using a property she bought in Whangarei as an example.

Wolfe enjoys giving back through her property investment coaching programme.