Custodian Millionaire Case Study: Heiner & Karin Karst


  • Occupations:
    • Heiner: Executive Coach
    • Karin: Small Business Administration
  • Age: Both 59
  • Family: Three Adult Children
  • Began investing in residential property (year): 2001
  • Property portfolio value (including principal place of residence): Approx $3.5 million
  • Number of houses you own (including principal place of residence): 7

Heiner and Karin Karst own their own home and they built a property portfolio of six investment properties between 2001 and 2004. They are currently reviewing their portfolio and goals.


When Heiner and Karin migrated to Australia 20 years ago with three young children, they started their new life with almost no net wealth. After 20 years in corporate life living in South Africa and Germany, the Karsts had some superannuation and a small deposit for a house after selling their home in South Africa. Effectively, they had what Heiner describes as ‘high executive income, no wealth’.

Within a year the Karsts bought a house to live in. They were well aware that the move to Australia had been at a financial cost and nearing their forties they were looking for ways to build wealth to secure their retirement.

Heiner and Karin joined a multi level marketing business in 1991. While they did not build any financial wealth, they expanded their minds, thanks to numerous self development functions and reading lots of books.

Ten years later, they were in a better financial position: Heiner was on a good salary, working as Chief Information Officer for the technology company Siemens. However, their accountant was unhappy: he told Heiner that he was paying too much tax and advised him to leverage his equity and tax to build a substantial investment portfolio outside superannuation.

The accountant encouraged Heiner to borrow money to buy shares but Heiner says, “I was scared of shares – their volatility and the threat of margin calls.” The accountant then got Heiner and Karin thinking about property and suggested several books about investment property. They spent months looking at properties within a 15 kilometres radius of the Melbourne CBD.

The more they learned about investment property, the more they learned about its traps. That was before reading John Fitzgerald’s Seven Steps to Wealth. The book make such an impression on them that Heiner made an appointment to see Custodian’s then Victorian State Manager wanting to buy an investment property immediately. He tried to convince Heiner was ready. So the Karsts traveled to Brisbane, which at that time was approaching its next growth cycle, to look at properties before attending a Custodian seminar. They signed up for two properties in Sunnybank Hills using the equity in their home for the deposits.

Heiner is grateful he read Seven Steps to Wealth because when he and Karin first considered investing in property, they were thinking of buying a 100-year-old terrace house in Fitzroy. “We would have made all the classic mistakes and lost all the taxation and depreciation advantages that a new home provides,” reflects Heiner. Also, using Investloan meant the Karsts were able to investment in three properties within the first year compared to just one investment property their own bank was prepared to finance.
Heiner and Karin bought six houses between June 2001 and February 2004 because, as Heiner says, “We wanted to, we need to and because we could.” They used the equity in their own home for the first three properties and then the equity in the first two for their fourth and fifth. The sixth was financed using the equity in the first three properties. Without a doubt, Heiner and Karin say that their best investment decision was ‘building a property portfolio in a proven, fool proof system with other people’s money to leverage compound growth of assets secured by growing asset value due to supply shortages and population growth.’


In 2014, when the Karsts started building their sixth Custodian investment property they hit problems. There were unexpected ground works and bureaucratic delays for almost a year which usually has financial consequences. However, the effect of those delays was virtually eliminated by the Custodian fixed price contract and by the insurance they had with Custodian which covered the extended construction interest payment until the property could be tenanted. Despite this set back, the capital growth, in the property continued.

“People need to know that Custodian is different,” says Karin.”The fixed price contract and insurance saved us. Custodian kept their word and did everything they could to help get the house finished.”

The Karsts like property as an asset class because it is ‘unsophisticated’.”You can leverage using the houses as building blocks to wealth. Housing demand is linked to population growth which keeps growing and it’s secure. Our properties all maintained their value during the GFC,”explains Heiner.


By 2004, the Karsts achieved their goal of owning six investment properties. Since then those properties have been growing in equity while Heiner has been working on another important goal – reinventing himself as an executive coach and growing his business. Heiner and Karin are now at an age and point in their lives where they will revisit and adjust their short-and long-