3 investment properties for $1million

A friend of mine who recently paid off his home went on a buying spree and bought 3 investment in nth suburbs of Melbourne..about 20kms from cbd within a 4 week period....the out of pocket cost are approx $500 per week before tax benefits..his income falls in 38.5% bracket
All properties were valued low to mid 400s in the good times and he's bought them for around low to mid 300s..

All homes will attract future homebuyers not investors, all three properties were purchased in one suburb..no diversity, he's borrowing 105% and all properties will be rented from day one..
He runs a contracting business and doing well, married with 2 young children. He has no super as he is a new Australian for about 7 years, he is 35 years old and wants to retire at 45-50.

Now can anyone see the problem/s with the above??does the above remind you of anyone you know??