Always keep your eye on the ball
I haven’t posted on the subject of property for a while, but it’s still been ticking away in the background whilst i’ve been building on the affiliate/ attraction marketing side and we’ve been very active, educating ourselves further in 2018. We’ve been on 3 courses during the year (2 x Samuel Leeds and one by Sarah Poynton-Ryan), and have done many viewings. You can’t tune out in the property game, there’ll always be an opportunity that pops up, but if you take your eye off the ball you’ll miss it.
Early in the summer we reached out on Facebook to landlords who were maybe looking to offload and got talking to a guy from Manchester who had 4 properties in North East England. There were two flats and two houses. He was interested in a Lease Option deal for the four. We viewed all four. One of the houses was in a real knot-hole neighbourhood and we didn’t really know about the flats. The package was worth a good few k in income, but there were bits we didn’t like about the financials and in the end passed the deal on. The guy we passed it on to was unable to agree terms with the vendor either, so maybe our decision proved correct as he was much more well versed than us. We are still in contact with the vendor however, so maybe something could still happen?
We found another property quite local, quite cheap
Keeping our eyes peeled locally, we found another house that was quite cheap, that fitted our search criteria, considerably below market value, and booked a viewing. The sitting tenant didn’t allow access first time around because she was feeling unwell, so we rearranged for later. Strictly speaking, she probably didn’t need to grant us access to view at all, but she did anyway when she was feeling better.
The house was in a very untidy condition (one of THOSE tenants) and she said that she understood the landlord wanted rid of her but she hadn’t received any proper notice of eviction, so has stayed put. There was evidence in places of potential damp, with tell-tale pvc cladding all the way up the gable end staircase. The tenant said the roof leaked too. We reckoned about £10-15k to bring it up to scratch, so we made an offer based on this. It was a rather cheeky one, but it was based on our true estimate of the costs involved.
Our Offer was turned down, but we kept digging
The offer was turned down, but we decided to leave it on the table. We then tried to find out more about the landlord and eventually tracked him down via Land Registry and Companies House searches. After talking to him, he had two other houses in the North East and he was willing to sell them for the right offer. So, we went to see one of them. Again, there was a sitting tenant, and she was due to have a baby, so we had to wait for a viewing.
Eventually, the tenant was in a position to show us around. She was a nice lass and her house was immaculate inside – nicely decorated and above all clean and tidy. Completely the opposite of the first house in fact. She said she really loved living there, she was working and her family were in the village (babysitter, important!). We told her we were interested in buying but were viewing all of the landlord’s properties. We said that if we did buy, we’d be happy for her to stay.
We made an offer straight away.
The house is a bit cottagey, on the edge of the northern dales, and could maybe become a holiday rental in the future. It would also be very easy to add a 3rd bedroom later as well. After a bit of to-ing and fro-ing we agreed a price of £77k. We also agreed a cashback deal with the owner, meaning we’d get a chunk of our deposit back and the ROI was then just a shade below 25%.
We hope to complete around mid-February, and the nett rent is around £3.6k per year. That’s a nice little chunk to add to our income stream. It takes our property portfolio value to £410k.
Diversify your money making activities.
Whilst this blog was based on property investment at the start, I saw the importance of diversifying and I can’t over-stress that. I make money from both property and other internet sources, primarily the training portal that i’m part of. I’ll continue to post on both here because that’s my path and that’s where I make my living.
If you intend to get into property yourself, I highly recommend going to a few courses (Samuel Leeds’ Property Investment Crash Course will motivate) to find out the basics. Samuel’s book ‘Buy Low, Rent High’ is also a great read (there’s a link in the right hand menu). As well as that, to diversify and add another income stream, if you want to learn how to make money online with me, sign up below.
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