The Tenets (or Principles or Beliefs) are based on the way in which an Extraordinary Investor approaches the property market.
Each tenet is equally important but this one is a particularly thorny one to get right, especially for new investors.
I’ve lost count of the number of deals I’ve turned down because of this tenet but it dwarves the deals I ended up going ahead with.
The tenet is dictated to as thus…
Not Every Deal is a Property Worth Having
What does this mean?
Often when a new investor is in the first flushes of learning about property investment, analysis, due diligence and the prospects of retiring early through property investment, they will be pretty keen to find a deal.
They will jump onto property portals daily, network with possible sourcing agents, walk the streets (if local), scour the emails and forums and be addicted to waiting for the phone to beep or ring for any hint of a deal that they think would be a good deal.
But often deals do not turn up straight away.
It takes dedication, commitment and a willingness to forego the attachment to a deal and instead turn it into a purely business decision.
And the days turns into weeks and the weeks into months and the new investor is no further along than they thought they would be.
Now there are often several reasons why this happens but we’ll discuss that another time in another article relating to the Immutable Laws of Investing.
For now though the critical thing to remember is this:
Desperation breeds a certain kind of reckless abandonment and folly which then leads to making rash decisions which then come to bite you in the derriere later on.
I speak from experience, so to make the point here’s a wee story that will turn the hairs on your chest white…
15 years ago in a darkened room somewhere in the shires…
You’re frustrated as hell.
You need a new deal. The itch needs to be satisfied.
It’s been too long since you last experienced that exultation of a cracking deal completed and a bottle of champers uncorked.
You’re looking and looking but you can’t quite find what you are looking for.
There are deals popping up here and there but they are not quite right or with enough discount or enough potential value-add.
Is your area dry? Have all the deals gone? Are you pushing too hard?
Whatever it may be, you are stuck.
Then a nice young smiley man appears and tells you about an amazing deal on 2-bed duplex apartments in an up-and-coming area of Yorkshire.
This deal is stupendous, there’s no money down, there’s a massive humungous discount, a large cash-back and the rental demand is rather fabulous.
Oh and you’ll make a tidy packet every month on the rental cashflow.
What’s not to like!
Fast forward 12 months later and you’re in bed with not one but two of these deals and you rapidly find out the bitter twisted truth.
the developer could not sell the units to normal folk because normal folk don’t buy what they built
the finders fees was 3% (a vast fortune in those days) which meant your actual discount trickled away
another 300-400 units went on the rental market at the same time as your unit
people really don’t like rooms with a light vent in them
a duplex can be called a duplex but can also be referred to as a 1 bed 1 bath flat with a dodgy small second room with no window (but it does have a light vent)
just because the area has demand does not mean to say that this particular development on the edge of the town has demand
when you finally rent your crappy flat, the cashback has gone, the rent is so low its rather laughable and you’re in a negative cashflow every month
the service fees and ground rents are so much higher than you thought they would be
the agent you were recommended by the ‘developer’ turned out to be inundated with so many units they stopped accepted new landlords … and the new agent you found via another recommendation turns out to be worse than useless, they are actually woefully incompetent
cash-back disappears very quickly when you aren’t receiving rental income every month
So why share this rather sad little story.
Because it illustrates the point perfectly.
On the face of it, getting hold of a 25% discount on a property sounds like a steal.
But sometimes, things are too good to be true and sometimes you want to walk away.
Not every deal is a property you want to add into your portfolio.
So don’t rush into a deal.
A deal will come up every day or every week or every month depending on your area.
But you have to buy your deals in line with the other tenets which I will cover in a future article (some of which I did not follow either).
And this is the reason for my sharing my stories for you to consider, reflect and maybe avoid the same mistakes I made.
So the next time you are wanting to satisfy your itch for a deal; remember to ask yourself the question.
Does this deal take me nearer or farther away from the goals I set myself when I started my investment portfolio?
As for me, the swish new apartments I bought proved to be my first and only foray into apartments and within a matter of years, I sold both of them at a hugeloss and vowed never to buy like this again.
In fact, I’m probably still paying for them in terms of lost time, income, energy and focus…
If we consider that we are living in times which few if any of us have ever experienced, then it would be fair to accept that we are uncertain about what the future holds.
However in order for us to feel certain again, we must ask ourselves a series of questions in order to move forward and accept the answers.
This can be done in the Rational Thinking Test[i]which takes you through a series of questions designed to have you answer them logically.
I would encourage you to go through these as they bring up interesting unbiased opinions once having answered the questions.
There is a psychological line, and we don’t want to cross it, so we have to deploy critical rational thinking to allow us to pass safely over that line.
You need to have an open mind to answer these questions.
You need to be able to handle the truth that answering these questions will give you.
You need to be comfortable that you may feel uncomfortable with the answers.
For each question, you can answer
No idea – No – Highly unlikely – Unlikely – Unknown – Maybe – Likely – Probably – Highly likely – Yes
Here are the questions:
Is this being used to move along a new world order?
Is there a virus of some sort?
Is the virus killing as many people as they say it is killing?
Is it killing some people?
Did the virus come from the wet markets?
Did the virus come from the lab in Wuhan?
Who owns the lab in Wuhan?
Was the virus natural?
Does the virus have a patent?
Is there a vaccine?
Is the virus a bio-weapon?
Is there a financial motive?
Is vaccination profitable?
Are there ulterior motives?
Are masks necessary at all?
Are masks necessary most of the time?
Are masks safe?
Does Anthony Fauci, Director of National Institute of Allergy & Infectious Dieases have ulterior motives?
Is there suppression of one side of the discussion?
Did Bill Gates say he wanted to reduce the population?
Is there currently any vaccines for this type of virus?
Does the test work accurately?
Can we trust the intention behind the tests?
Is the tracking app necessary?
Is the tracking app likely a covert control measure?
Do you trust the information coming out from the governments?
Do you trust Boris Johnson, Prime Minster (UK) intentions?
Do you trust Donald Trump, President (USA) intentions?
Have the WHO been accurate and trustworthy?
Do you trust the intentions of the WHO?
Are the tests for coronavirus accurate?
Does the test pick up other things like stress, flu jabs, the common cold?
Does the argument that this is a natural outbreak hold up?
Are the scientists who are leading the action neutral and not financially motivated?
Are the governments pushing obvious preventative measures on health?
Could it be that the government do not understand true health?
Did Sweden make the right choice against the world popular thinking?
Is the response rational based on immunity (ie, will lock down hurt immune levels)?
Will there be a second wave after lockdown?
Are the actions with lockdown going to cause larger problems elsewhere?
Do you think they are going to use this to force mandatory vaccinations?
Has the question of lack of trust in Google, Facebook and Youtube been answered?
Are the death numbers worthy of trashing the countries economy?
Where the governments fed bad data which led them to bad choices?
Where the people who gave the governments the data financially motivated in any way?
Are the media making things better or worse?
Are the media working with the governments to suppress alternative narratives?
Could this be caused purely by the scientist's poor maths based on the truth that scientists are only wrong if they underestimate the death rate?
Depending on the answers you gave will illustrate where your thinking lies.
All thoughts are your thoughts and no thoughts are bad thoughts, they are only that; your thoughts.
If you feel that some of your answers surprised you, that means you are rapidly becoming conscious to what is going on around you.
If you feel that some of your answers did not surprise you but you feel powerless to act, then again you are becoming conscious to what is going on around you.
Whether you choose to act or not is up to you.
If you do choose to act, here follows a statistical analysis and some forthright questions that a person with nothing to hide would easily answer…
The questions I’d like the UK Government to answer in full and with rational thought.
I’d like to preface this section by stating that this article is taken from a 16 page letter I sent to Peter Bone, my local Member of Parliament for Wellingborough, Northamptonshire, UK.
I had to illustrate my points using both data for Northamptonshire and the UK. As such, some points are local in nature but still relevant in the wider context of the questions I am asking.
All data used is up to 26th May 2020. All source data is listed at the end of the article.
My remit in the analysis I present is to understand the following 4 questions:
Why are we not applying rational logical thought to decisions that are being made rather than causing mass panic, reactive stop-gaps and an illogical plan full of holes?
Why have we ‘purposely’ driven the UK into bankruptcy and caused fear and panic to the extent where society has been forever fragmented and may never recover?
When will the Prime Minister, senior Ministers and Members of Parliament whom voted for the Corovirus Bill admit that they were wrong to instigate a police state and NOW cast aside the Corovirus Bill so human rights and freedoms can be protected?
Why are no directions being given from Government, NHS nor Media on the benefits of a healthy immune system and how you overcome the disease?
1.1 Why is there such a large disparity between alleged COVID-19 deaths vs deaths in cancer and cardiovascular cases?
Northamptonshire ‘reported’ cases of COVID-19 were 1,435 cases out of a total population of 747,622 which is less than 0.19% of total population and has been since I started recording the cases myself before lock-down.[ii]
Total recorded deaths is 487 which could be seen as a 34% case fatality rate or in other terms a crude mortality rate of 0.06%. As we are unclear of the total number of infections due to inadequate testing the overall infection fatality rate is unknown (but could be around 0.8% (see later statement).
Given the heavy media and government bias in reporting these cases, it is worthwhile to compare the other causes of death.
These statistics are hard to acquire but indicate total deaths of 1,365 which based on total population is 0.001% mortality rate. Total identified cases are 70,700 indicating that case fatality rate is 0.019%.
I highlight this to show the vast discrepancy in deaths normally accounted for in cancer and cardiovascular cases (the two highest forms of death in our county and nationally) to compare these verses COVID19
Put it this way; if we extrapolated deaths so far on the same bearing and pattern for COVI19, this would indicate at a reasonable level that we’d expect around 1,144 deaths in Northamptonshire vs 1,365 cardiovascular deaths and nearly 50% more deaths from cancer at 1,500… (but we don’t have a cure for either of these)
Deaths so far (if accurately recorded see point 2) would indicate that May 25 being 39.7% into 2020 or 145 days, we could say we’ve averaged 3 deaths per day meaning we could potentially face up to another 657 deaths this year.
1.1.1 Does locking down an entire county of 747,622 people for 1,144 deaths or a 99.4% chance of surviving seem a rational or logical thing to do?
1.1.2 Given that NHS have been told to only prioritise urgent cases, how many more cancer and cardiovascular cases do you think may have gone untreated and how many more deaths will be caused by this policy?
1.2. The Use of Inaccurate Data to make decisions affecting 66 million people.
From Tuesday 28 April, NHS England and NHS Improvement started to report the number of patient deaths where there has been no COVID-19 positive test result, but where COVID-19 is documented as a direct or underlying cause of death on part 1 or part 2 of the death certification process. This change has been introduced for deaths that occurred on 24th April and subsequently and is shown separately in the region data table only. When making comparisons over time these figures should not be included.[v]
1.2.1 Why is the NHS inaccurately reporting deaths as COVID19 when they are perhaps unrelated, the person had underlying symptoms and would have died anyway of cancer, cardiovascular or respiratory conditions?
1.2.2. Why has the NHS on its website indicated that despite NOT TESTING for Covid19, they are categorising people as having died from this virus on the death certificate?
1.2.3. Do they get more money from Government or Corporations if they record the deathinaccurately?
1.2.4. Who decided to issue this directive to start reporting in this way?
1.2.5. Which Minister was responsible and why did they take this decision when it is clearly misrepresentative of the truth.
1.2.6. Furthermore, given the many reports of tests being inaccurate and indeed having heard of both goat and pawpaw samples being tested positively overseas, how can we be sure that these records are in fact accurate?[vi]
2. The Folly of using flawed Lockdown Models & Impartial Experts
2.1 Why are we basing a lockdown directive based on inaccurate and misleading information including highly questionable models from the Imperial College team headed by Professor Neil Ferguson suggesting 250,000 would die from this virus?
In 2002, Ferguson predicted up to 50,000 people would die from mad cow disease.
So far there has been 177 deaths.
Ferguson managed to persuade government to cull £10 billion worth of livestock in the foot and mouth outbreak even killing animals with no evidence of infection in neighbouring fields.
Ferguson predicted up to 150 million people could die from bird flu.
The real number was 282.
In 2009, he suggested that 65,000 citizens (and furthermore one-third of the world’s population) would die from swine flu.
The number ended up being 457 in the UK.
I could go on… but this chart may illustrate how far off his predictions have been so far.
2.1.2 Would you agree that basing decisions from data provided by this fruitcake and providing him with a public platform and funding could prove somewhat problematic and difficult for the general public to accept once they learn more of this…?
2.1.3 Given the above directive by NHS England (1.2 Section) to misleadingly label deaths as coronovirus, could it be construed that there is something else afoot here and was it worth locking down our county, sending our economy into recession and causing immense hardship and further deaths in the future from poverty, isolation and mental health?
Monthly tables are produced by UK Statistics Authority yet since March 2020 they have stopped reporting on any cause of death outside of COVID19.
Interestingly, if you look at the statistics for March 2020, when most experts would agree that we were already in the midst of COVID19 and the virus was rife within the population, some interesting statistics come to bear.
Cause of Death
Heart Disease 19.48%
Dementia and Alzheimer 15.24%
Respiratory Disease 13.34%
Coronavirus 8.15% (NOTE point 1.2 above)
Influenza & pneumonia 5.76%
This would indicate that the COVID19 virus has been over-hyped given that people are still dying of other illnesses in far greater numbers and if reports are to believed according to point 1.2 the COVID19 numbers are in fact over-stated.
2.1.4 Why have we stopped reporting on the Cause of Death from March 2020? Has nobody died from cancer, heart disease, dementia, respiratory disease and more?
2.2 How can we truly be sure that the advisors on SAGE are in fact impartial?
The Government website clearly indicates one worrying fact.
Permission to publish names was requested from all participants. Those who did not give permission have not been named.[viii]
2.2.1 Why is the Government allowing people to be on extremely important advisory groups but unwilling or unable to publish their names?
2.2.2 Have all of the advisors been checked to understand where their funding or predilection comes from?
I personally have not had the time to dig deep into the funding nor bias that the advisors come from but having read various reports about the group, it appears reasonably certain to me that a large percentage of the ‘un-biased’ advisors have in fact received funding from pharmaceutical companies or companies invested into vaccines.
2.2.3 Will an independent committee investigate who is on the advisory panels, what their background is, what funding they have received to date and are they truly independent?
3. Why have we willingly given away our basic rights, freedoms, financial stability and mental health and embraced the implementation of a Police State governed by an erratic PM and dubious advisors and in 2 short months crashed our economy, way of life and put baseless unwarranted fear of other human beings into normally sane people?
enable existing mental health legislation powers to detain and treat patients who need urgent treatment for a mental health disorder and are a risk to themselves or others, to be implemented using just one doctor’s opinion (rather than the current 2). This will ensure that those who were a risk to themselves or others would still get the treatment they need, when fewer doctors are available to undertake this function
3.1 In Schedule 21 of the Coronavirus Bill; why have you agreed that only one doctor’s signature is needed to ‘detain and treat patients who are a risk to themselves or others’; does this mean if I refuse to have a vaccine will I be deemed a risk to others and thus categorised as mentally unstable? How can this be a legal use of power? Where are the safeguards?
provide powers to require educational institutions or childcare providers to stay open or relax some requirements around education legislation in order to help these institutions run effectively during the event of an emergency. This could include reducing teacher ratios, adapting school meal standards and relaxing provisions for those with special educational needs. This will ensure that children, young people and those who work with them remain safe, while minimising disruption to everyday life and progression to further and higher education or employment by ensuring schools have the flexibility and support they need to respond pragmatically to the changing situation
3.2 Why have you shut schools with no oversight or governance as to what they are doing?
There are no general followed guidelines, no consistent education being given yet I believe all teachers are being paid full salary?
3.2.1 What are teachers doing on a day-to-day basis on full pay given that they are not conducting lessons, they are not marking homework, they are not holding parents evenings and they are not progressing children along their education path?
3.3 Can you advise why you voted to allow public health officers or constables the power to detain based on assumptions that I ‘may be’ infected with coronavirus and likewise to allow said officers to take from me a biological sample?
How would they know? Are they qualified to make this assessment?
3.3.1 How can they accurately make this assessment given that the testing kits so far provided worldwide appear to give wildly differing results and are inaccurate?
3.3.2 Isn’t the very nature of forcing me to submit to a biological sample against my fundamental human rights to refuse as only I know what my body is or isn’t doing?
3.4 In Schedule 22 of the Coronavirus Bill, you give wide-ranging Police State powers that have effectively ruined our entire economy yet the Parliamentary State is exempt?
Why is this given that in actuality, the Parliamentary State no longer has any say in how our country operates and must follow the lead given by the Cabinet on what they can and cannot do outside of the Parliamentary State? Laws are being made on a daily basis that no member of parliament is voting on or ratifying.
The Scourge of “Essential Work’…
We see daily news reports in our county of Northamptonshire (and indeed nationwide)
– traffic wardens in Northampton town centre (personally witnessed 7 traffic wardens at 830am on a Saturday morning looking for business (raising money for Northampton Borough Council)
– mobile camera vans out on the roads looking to raise revenue
– police officersharassing people desperate to be outdoors yet made to feel like criminals
– a police chief constableNick Adderley, Northamptoshire firmly showing his true colours in the wake of this crisis by making people feel like criminals for ‘getting fresh air’! When a police chief tells you he is considering road blocks, checking supermarket trolleys and then telling people where they can and can’t go; I have to ask myself – am I in George Orwell’s 1984 or did something just change I am unaware about?
3.5 How do you determine what is essential work; when what I consider non-essential work carries on?
The Rules For You and the Rules For Me…
We are told to socially distance yet I’ve personally witnessed
– bin men crammed 3 to a cabin picking up the bins wearing no gloves
– no evidence given why the 1M rule (from WHO) becomes 2M rule if you’re in England
– members of parliament sitting next to each other
– police constables carrying out normal duties sat side-by-side in their police cars
3.5.1 In short, why is there one rule for the ruling elite and the police state and there appears to be another rule for the people. This doesn’t seem right nor fair to me.
3.5.2 Why is it that WHO Guidelines indicate a 1 metre distance yet the UK government has decreed that we have to maintain a distance of 2 metres? Are reports that we are too stupid to understand what this means true?
4. Why are we not open minded about tangible beneficial ways of getting people and businesses back to workwithout fear or panic?
As a government ably supported by the media, you have spread fear and panic amongst the people that they are now scared of the very fabric of our great nation – our people.
Why are we not looking at the whole problem rather than coming up with short-term piecemeal solutionswhich will not work?
4.1 Why is the Government not giving advice on what people can do to boost their immune system through for instance taking Vitamin D3, C, A, Iodine and eating real food?
I haven’t seen any government advice about improving your immune system and feel that this is a fundamental lack of understanding, direction and woeful neglect.
It has been proven by numerous studies that eating fresh vegetables, fruit, nuts and seeds has a positive impact on health yet this has not been mentioned.
Studies have also indicated that Vitamin D was woefully low in many COVID19 deaths yet the government have not been directing people to take this more.[ix]
4.2 Is the risk as great as the ‘un-biased’ experts believe that it is?
With 3,681,295 tests having been conducted and only 265,227 infections identified, it would appear that from these tests alone the infection rate is 7.2%.
If we extrapolate this out to the wider population, this could mean that 4,784,499 people have the virus currently.
If we further investigate the deaths by age, we see a pattern.
52% of deaths occurred in the over 80s, 39% of deaths between 60-79 and 8% of deaths in the 40-59 age group. Between ages of 0-19 has seen 0.06% of deaths and 20-39 only 0.72%.
However we have also seen that recovery is positive with an estimated 0.06% crude mortality rate or in laymans terms, I am 99.94%likely to recover from this virus and go about my day-to-day life without interference from the government.
This indicates to me several things:
If the chance of dying from the disease is slim (as indicated by Professor Whitty on several occasions), then the logical rational thing to do is immediately open up all businesses and destinations to anyone under the age of 60 given that the likelihoods of them dying from cancer, heart disease, diabetes or chronic respiratory disease is far higher (10.9%) than dying with COVID19.[x]
With the over 60’s it could be argued that a slower gradual process could take place over a series of months as the virus dies out.
Why then are we still insisting on lockdown?
Should I be scared given that I have an immune system and that I am 99.94% likely to recover from this virus should I get it.
Let me explain this in pictorial format.
All data based on data from Government sources and based on my COVID19 Modelling using the alleged Reproduction rate of 4 (pre-lockdown) meaning that for every person infected they will pass this onto 4 people.
A Room of 50 People will have 4 People carrying the infection with R Rate 4 could result in New Infections 16 With the result of potential deaths of 1 person
A Room of 100 People will have 7 People carrying the infection with R Rate 4 could result in New Infections 28 With the result of potential deaths of 1 person
A Room of 150 People will have 11 People carrying the infection with R Rate 4 could result in New Infections 44 With the result of potential deaths of 1 person
A Room of 250 People will have 18 People carrying the infection with R Rate 4 could result in New Infections 72 With the result of potential deaths of 1 person.
A Room of 500 People will have 36 People carrying the infection with R Rate 4 could result in New Infections 144 With the result of potential deaths of 2 people
A Room of 1,000 People will have 72 People carrying the infection with R Rate 4 could result in New Infections 288 With the result of potential deaths of 3 people
A Room of 3,000 People will have 16 People carrying the infection with R Rate 4 could result in New Infections 864 With the result of potential deaths of 7 people
A Room of 10,000 People will have 720 People carrying the infection with R Rate 4 could result in New Infections 2,880 With the result of potential deaths of 23 people
A Room of 20,000 People will have 1,441, People carrying the infection: 1,441 with R Rate 4 could result in New Infections 5,764 With the result of potential deaths of 45 people
A Room of 30,000 People will have 2,161 People carrying the infection with R Rate 4 could result in New Infections 8,644 With the result of potential deaths of 67 people
A Room of 50,000 People will have 3,602 People carrying the infection with R Rate 4 could result in New Infections 14,408 With the result of potential deaths of 112 people
A Room of 100,000 People will have 7,205 People carrying the infection with R Rate 4 could result in New Infections 28,820 With the result of potential deaths of 224 people.
What does this tell us?
Quite simply that we could very easily open up bars, restaurants, theatres and cinemas RIGHT NOW – because the risk is so low.
Schools can go back to pre-covid operating procedures because the risk is so low.
Shops can go back to pre-covid operating procedures because the risk is so low.
Public transport can go back to pre-covid operating procedures because the risk is so low.
However this is assuming a reproduction rate of 4 and right now the reproduction rate is hovering between 0.5 and 0.9.
This is also assuming no precautionary measures are taken at say an outside sporting event of wearing masks (for people who suspect they may be ill or vunerable).
In reality, the risk is much lower as has been proven by the Swedish model.
So the government could open up sporting events and business events again – if appropriate safeguards were taken (even though arguments could be construed to say that no real precautions are necessary given point 4.1).
If you are a healthy human with a strong immune system, you have nothing to fear.
You have a 99.94% chance of recovering.
WHY HAVE WE WILLINGLY GIVEN AWAY OUR FREEDOMS AND RIGHTS FOR A VARIANT OF THE FLU? HAVE WE LOST ALL COMMON SENSE AND ABILITY TO QUESTION?
[x]World Health Organisation Probability (%) of dying between age 30 and exact age 70 from any of cardiovascular disease, cancer, diabetes, or chronic respiratory disease (Global strategy for women's, children's and adolescents' health)
When we consider the changes afoot for the property industry, one thing I’ve seen over the last 16 years owning and managing HMO’s (over 1,000+ rooms over this time period) is that in order to be ahead of the game, it’s important to embrace new changes and ensure that your HMO is fit-for-purpose in today’s world.
Here’s a few things for you to consider to improve your HMO.
1. Easier Transparent Contact
The way we contact each other is changing. As landlords we need to embrace newer methods of technology and offer tenants a multitude of different ways for them to contact us including:
Messenger apps – facebook/whatsapp
2. Live & Work Spaces
More and more people are living and working in different ways and its important that we recognize this. Tenants are no different to anybody else and we need to embrace this by offering
Additional facilities such as work-study desks
More access to local co-working spaces
3. Shorter / Longer Contracts
We live in a mobile society where jobs are often for months if not week rather than years. With this more transient society means that we may need to consider short-term contracts (something that does not really exist right now apart from the somewhat spurious licence agreements) so that tenants can move into a unit for a shorter period of time.
At the same time, tenants have been pressing for longer term contracts which is again something that may be considered in order to allow for more security of tenancy.
This could of course disrupt the internal dynamics of the housemates relations but should be considered as something that will happen and thus we should begin to make compensation for this.
4. Community Integration
One of the accusations made towards HMO tenants is that they do not integrate with communities. Given that we are under pressure to deliver 300,000 homes, I see no other way through which this could happen without the help of HMO’s.
We therefore need to encourage more community interaction and engagement with our HMO tenants including education, liason and getting involved with community projects.
5. Smaller or Large HMO’s
Council-driven regulations seem to be honing down on the ideal 4 and 5 bed HMO’s as standard. This is disappointing given that for me, the sweet spot has always been a 6 bed HMO but more and more councils seem to be preferring the smaller HMO’s as they have ‘less impact on the community’.
All anecdotal of course but then at the other end, we see more and more applications being approved for the monster HMO’s of 10, 15, 18 or 20 bed units which to be fair have to be run in a completely different way to a small HMO with more hotel-type facilities and a higher-level of management.
6. Larger/Smaller Rooms
Recent regulations have come out enforcing 6.51m2 as the smallest allowable room for a HMO tenant to live in. However, is this the smallest room that somebody may CHOOSE to live in?
We’ve had a few rooms in the past measuring 5-5.5m2 which have been eminently suitable for contractors only wishing to stay a few days of the week but under new regulations none of this rooms will be now available.
How many box rooms in the country will now be unavailable as a unit of accommodation? 10,000 – 30,000 – 50,000?
And how does this regulation impact the ‘Rent-a-Room’ scheme where a homeowner can rent out a room? Different rules, same accommodation?
At the same time, a tenant would generally prefer a larger room and this could be possible through new methods of build and technology but only if these are embraced by local planners and councils – modular homes anybody?
7. Home Automation
With the advent of technology being amongst us there are now more opportunities for both tenants and homeowners alike to take advantage of the wonders of home automation.
Imagine being able to ensure the hot water is on when you come home to have a shower or that your heating in your room is at your preferred temperature of 20° or even that you can put on your front porch lights before you get home.
It’s here, it’s here to stay; how can you utilise this to attract more tenants to your HMO?
8. Integrated Entertainment
More and more tenants are demanding the best possible entertainment.
Forget digital channels such as Sky or Virgin; today’s tenant is more likely to watch Netflix or Amazon Films so how do you utilise this growing trend to attract tenants? Group Netflix accounts are here so why not consider extra accounts for your tenants?
9. More Bathrooms / Ensuites
People don’t like sharing bathrooms. People don’t like sharing bathrooms.
Enough said but how do you facilitate letting people have their own ensuites when its possible the Valuation Office may revalue your ‘all ensuite’ HMO as individual units?
Simple; have a mixture of ensuites and shared bathrooms for up to three people.
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I want to spend some time talking about myths that are going on right now in the property industry, because there are a lot of them, and explain some of the things that are plainly, plainly wrong.
So, here goes.
Property Myth One
The first one that I want to cover is; there is a myth out there that is predicated, and positioned, and proposed by a lot of educators, and training companies, and so-called gurus that to invest in property, you don't need any money.
And in fact there's been books written about no money down property investing and I want to debunk the myth that that's actually not true.
You do need money to invest in property investment
As to how much money you need, that is a different question entirely.
So when we look at the amount of money that's required; let's say that you're not going to actually purchase a property, but you're going to do some kind of rent to rent or lease on a property.
If you did that, you would have to find the money to pay the first month's rent, and pay the deposit more often than not, potentially pay some admin fees. And you would then need to furnish the property.
Now this is because most properties that you're going to rent or lease in order to make a return on the difference between what you're renting it at and what you're renting it out for are going to be done through some kind of HMO or potentially even serviced accommodation combination.
So you'll have to get furniture.
Now, there are ways in which you could rent furniture for sure, but most people when they're getting started are probably going to buy the furniture outright.
And you may have to put in things like fire alarm systems. You may even have to get white goods and brown goods. So you're going to be looking at really four, five, six thousand pounds in terms of doing that to get into a rent-to-rent or a lease option.
So when people come on and say, "Oh, you don't need any money," that's not true. It's just not true.
Now, I'm not saying that you can't find people to help you with the money, and obviously there are investors out there that potentially would give you the money, providing that you position the deal and it is a good deal.
But if you're just getting started and it's your first deal, that's going to be pretty tough to do.
So the first myth is, no money down is not true.
You'll always need some money, always. And we haven't even talked about anything to do with legals, brokerage, surveys and all that jazz – if you're buying a property.
There are ways in which you can purchase a property and refinance it and pull a lot of money out.
But in terms of having the money in the deal and not having any money leave your bank account and go to the vendor's bank account, it's just not going to happen.
The second myth that I wanted to share with you is, there's a myth out there at the moment as well that you have to be in this whole property investment arena full time in order to make a success of it.
And again, you don't.
There is a myth out there that if you're not full time in property, and you've not given up your job, and you've not gone into it 100%, and you've not burnt all your bridges, and you not said goodbye to employers; you're not a real property investor.
That is not true.
You do not need to be full-time in property investment to be successful
It is perfectly reasonable, and in fact I have many clients that are still in a full time job or run a full time business that are building a property investment portfolio on the side as side income. And because they're doing that, that means that they're able to still benefit from the job that they have and the credit that comes along with that job; in the end, the potential ability to borrow that comes along with that job.
It also means that they're able to build this pot, this portfolio, which grows, and grows, and grows the more, and more that they develop it and effectively build more properties and refinance over, and over again.
So when people say, "Oh, you can only do this if you're full time," it's not strictly true.
And in fact, I firmly, firmly believe and am of the opinion that you can get involved in property investment in probably around five hours or so a week and make a success of it. Absolutely.
So it is a myth that's out there and I think it should be taken with a pinch of salt.
Obviously, if you are spending all of your time and energy on it, then you're potentially going to accelerate a lot quicker. However, at the same time, you are not necessarily going to be any better off than the person that is still employed or in the business and building a portfolio on the side.
So you don't have to be full time property to be an investor.
What you have to have is the right tools, the right power team, the right structure in place in order to make it successful.
The third myth that I want to get out there, and this is one I see time, and time, and time, and time, and time again, is people talk about, "I've got to get a deal," and it's all about the deal, and nothing else matters.
And I'm here to say that that is actually wrong.
What's really crucial when you are investing into property and you are effectively wanting to build a portfolio, it is not the deal to begin with.
It is not the deal, because I could show you a deal right now and say, "Hey, here's this deal. Here you go."
Let's say I have a deal and I say to you "Here's the deal. It's a great deal. It's 20% below the market value and you're going to make £1,000 a month, and it just needs a small refurb and you going to make all this money, and it's great, and you should buy it."
But you don't know anything about where it is.
You've just been told it's a deal.
A deal is not a deal if it’s in a location you don’t know
And the thing is, it's easy to present a deal if you don't know the area. It is really easy. It's almost, basically, it's a little bit like pick-a-mix to some degree.
You can go and you can pick something, but you're not really sure what you're getting, but you know you're getting a sweet.
And it's the same thing in chasing deals. You've got to stop chasing the deal. It's the wrong thing to do, and everybody is doing this. All you have to do is focus on chasing the location.
This is what people do wrong over, and over again. So chasing the deal is not the right way to go about it because unless you understand and know the area in intimate detail, it's just a potential deal.
Now, if one of our agents rang me today and said, "I've got a deal," and it's in our local target area where I buy all the time, I would know pretty much within seconds of him or her telling me what the deal is, is it actually a deal?
And the majority of times it is, it is a deal.
Sometimes it isn't, but you've just got to be aware of this that from the perspective of really focusing on what's out there and what's happening in terms of deals, it is very much, a deal in an area that you understand, and if you understand an area and you know it well, then it is a deal.
But I'm so, so frustrated with people, even clients calling me up and say, "Oh, I've got to deal. I've got a deal." "So, where is it?" And it's in an area that they're not researching. It's like it's not a deal. It looks like a deal, it ain't a deal.
The fourth myth. This is something that is very rarely mentioned by a lot of the big training companies, big gurus, the big people that run around the stage, jumping up and down, getting you excited and speaking really fast, then moving their hands around and getting you to invest in nonsensical 2 grand courses that deliver naff all; you know the kind.
Property investment is made and is at the same time killed through your tenants.
Now what do I mean by that?
Effectively, your tenants who pay your rent effectively pay your mortgage.
Anything that's left over from that, it's where you make some cash, which you can then reinvest into other properties, reinvest back into the property, take something to live off, build up your savings, whatever it is you're doing.
But it's tenants that do all that for you.
So if you're not looking after your tenants and you are not making sure that the property is safe, clean, it works, everything works, and you're addressing maintenance issues, and that they're happy. Then without having tenants being happy, then you run into problems and issues.
And this is when tenants stop paying the rent. It's when tenants basically start moving and getting into this whole issue around causing problems.
And this is when we run into issues regarding the eviction of tenants through Section 8 and Section 21, and they're not leaving, and then I have to get bailiffs involved.
A happy tenant pays on time and keeps the property in a good condition
So the fourth myth that no one talks about, but is actually the foundation of which property investment is made, or isn't made, are tenants, look after your tenants.
So if anything, if you're going to be a property investor, and even if you're going to be one that is say, having this as a side income and you either outsourced some of that to let's say an agent, you've got to make sure that they are looking after the tenant for you.
Because if you're not looking after the tenants and they're very much around this whole issue around not catering for the tenants' needs, looking after them, then you will run amok very, very quickly.
You could have the best deal ever in the world. But if you're not filling the property with good tenants, then the deal is not a deal, right? It's just not a deal.
So that's the kind of fourth myth that's kind of out there.
The fifth one, and it's the one I want to end on is really around this other myth that's out there at the moment that again is being positioned, and proposed, and talked about by a lot of big training companies, and a lot of these so-called gurus out there is that you can be a jack of all trades.
What do I mean by this? You’ve seen these sales pages and videos and they say, "Oh, you're going to come along to this event and we're going to teach you how to do buy-to-let, we're going to teach you how to do HMO, teach you how to do service accommodation. We'll teach you how to do flips, going to teach you how to do small developments, going to teach you how to do to big developments, we're going to teach you how to do this, this, and this."
And in the end it's like… you don't need any of that stuff.
You just do not need any of that stuff.
What you really need to get started is a thorough understanding of what it is you actually need from a revenue and income perspective, how much it is you need to live on, and then you need to look at what strategy allows you to do that the quickest.
The reason why this is so relevant is because when I first got started in property investment, and you can check out previous articles/videos in terms of how I got started and why I got started; I focused on DECIDING.
But when you're starting to get going in property investment, you really need to look at, where you're at the moment, and where you want to get to.
And what I quickly realized is, it will be impossible for me to go and buy standard buy-to-let properties and replace my income, which is what I wanted to do at that stage.
I was in a position where I had to leave my money, my job, my world, my career. It would just be impossible.
So this is why I specialized in HMOs, which became rent-to-rent, lease options and refurbishments, small developments, and so on, and so forth.
But going down a very similar route, which is, the whole thing around HMOs, whether it's boutique, or professional, or student, or whatever.
Now, it's really easy to get into the whole shiny penny syndrome and think, well, let's say that you're in an area and bread-and-butter buy-to-lets work really well for you. Let's say you're in the north and you're getting nine, 10% deals, and you think, "Right, well now I need to start doing something else."
So you start maybe doing some small developments, and then they don't work as effectively because you're not necessarily an expert in that area.
You don’t necessarily have a power team behind you and you've diverted your attention from where you were, to something else.
Being a generalist in the property investment world does not work.
All the people I know that are making really good money and are really crushing it are focused on probably one strategy, two maximum, but certainly one main strategy.
And the second one is a side strategy and it gives them some income, but on a periodic basis, not every single month.
So, if you are getting started in property investment and you're thinking that you've got to do this, this, this and this, you don't have to do all those things.
You don't have to run around doing four or five different strategies at once. It will be foolish for you to do that. You want to start, and you want to focus, and you want to go really deep into a strategy to make it work for you. And that way, you'll start to build up your income really, really nice.
So, just recapping where we are in terms of these myths then, because there's five myths that I explained.
The first myth is everyone says out there, you don't need any money to get started in property. I say that's bulls**t, you always need some money.
Now it may not be yours, it may be an investor's and if you can persuade an investor to give you their money and you don't have any experience, then well done, you've done really well.
But for the majority of people, that first deal that you do, you're going to have to put some money in. And the lowest amount of money you're going to be putting in is probably five to 8,000, probably around that figure.
The second myth is you don't have to be full time to do this.
Everyone tells you, you've got to dive in. There's this whole thing around ‘I want to become a property investor so I can leave my job’. It may not be the job that you hate, it may be the fact that you're reporting to someone that you don't like, and it could actually be that your industry is still really good for you, but don't leave too soon.
Start percolating, building it up in the background and really start focusing on having that income coming in, whilst you then build up your career at the same time. Maybe move company's get someone better, and keep building that portfolio up.
The third myth is that you shouldn't be chasing the deal.
What you should be chasing is the location, and then the deals will come to you in the location.
Don't get focused on, "I've got to find a deal. I've got to find a deal, I've got to find a deal." What you want to be focused on is, you've got to really focus on getting the right location right, and then when you've found the location, then the deals will come to you.
The fourth one is, in order for this property investment to work, you have to have tenants.
You have to look after your tenants, you have to respond quickly to tenants, and you have to make sure that they are happy.
Happy tenants pay your rent, and unhappy tenants do not pay your rent, but the best rule in the world, you will always have at some point issues with tenants and you will always have issues with them not paying money. This is going to happen. It will happen to you. So do not go into this with your eyes shut thinking this is not going to happen. It will.
The fifth one is the fact that you cannot be a generalist.
You can't be doing three, or four, or five strategies.
You've got to focus on one strategy. You've got to get really good at that one strategy. You've got to go deep into that strategy. You've got to master it in your chosen area.
Then when you've hit those target levels that you're aiming for in terms of perhaps you have all of your bills paid for so that you can then potentially leave your job and go and do some charity work or set up another business, or do something different, but have an income level in place that you're aiming for, and at that stage, maybe think about doing another strategy, but don't do it too quickly.
The focus needs to be on doing one strategy really, really well and really then leveraging off the back of that.
Don't worry – the sun will keep shining … (Or in the case of most of Britain, the rain will keep falling) even if I did Vote Leave.
This is an extract / reworking of a few posts I put up in 2016 on social media platforms when the referendum to leave the EU first took place.
After last nights diabolical shambles I felt I needed to put pen to paper again to share my views and despair about where we are headed as a country.
I've lived in Great Britain all my life. First a Yorkshireman then an Englander. Then this thing came out about Europe…
When I was at school I was President of the European Society and organised talks with Export Directors of major companies including Rowntree/Cadbury and ultimately ended up organising a one day European summit.
When I look back to the Maastricht treaty and the promises of a brighter future – on paper it all sounded magnificent. A Europe with no borders with freedom to travel and work.
With university and work and then my own businesses later down the line, this "ideal" for me became even further removed from the sad reality of that bright promised future.
The problem is as I see it and nobody wants to tackle this is that fundamentally we are talking about 28 different countries who have their own language, customs, cultures, laws, perceptions (and some their own currency) all trying to be shoehorned into something that doesn't "quite" work.
I love France, I love Italy, I love Spain, I adore Switzerland and Austria amongst others – but I'll be damned if I understand them. I'll never understand or quite get the quaint customs or places or people or way of life that make them unique but I'm eternally grateful for them.
But – do I want to have the same laws that apply in France apply in Great Britain?
I'm all for free trade (which we don't have incidentally as the EU has not negotiated trade deals with several countries – how long does it take) but I have no interest in someone I wasn't involved in electing or voting for tell me how I should run my business or my life.
We have plenty of that already here in the UK thank you very much.
I own a lot of property. I did this because 20 years ago I foresaw that I would not have a big enough pension to worry about what I did for 20-30 years AFTER retiring. If the vote was stay then I would probably have made a ton of money from capital appreciation. If the vote was no as it needed up being, I'll still make money but it will be from cold hard earned cash from rental profits (the way any business should operate ironically) and maybe some from capital appreciation (but the very fact that you can make 100,000 in 6-8 years from your property without doing anything is incidentally complete down to the buffoons in national government, local government, national house builders and the nimby that exist everywhere.
I run a business. I'm forever hampered by this EU regulation or this EU law about X,y,z which I can maybe see at a high level "could" work but it was made as usual by people who are trying to shove a round peg In a square hole.
I vote for Europe and always will do but I don't vote for the EU. I vote leave.
The founding fathers would be horrified if they could how it has ended up; the wastage; the not-in-my-backyard politics, the behind closed doors deals (TTIP anyone) and more shockingly the forced view that if you are not for combining your countries armed forces, currency, democratically elected government and so on – that you are actually against progress or freedom or friendly relations with other countries.
What utter tosh…
For me – this comes down to having a say.
I believe that you and I are more likely to be able to "make a difference" and have our opinion counted than where this all originating from Brussels/Strasbourg or wherever the EU is meeting today. This is why I Vote Leave.
A lot of talk has been made about trade agreements and how we will be worse off. Utter poppycock.
A lot of European countries need our money as much as we need theirs. If there is a will there is always a way.
Will the Germans stop selling us BMW's? Will the Italians stop selling us Ferrari's? Will the Spanish no longer welcome us to Costa deal Sol? Will IKEA refuse to serve us because we're British?
Can the EU enforce a trade tariff that is not in our interests? Yes. But would the countries stand for it??? No, they would vote leave as well.
My hope for Europe is that this experiment comes to a shuddering halt. And countries start to question why, what, where, how – the EU can be truly reformed for the BETTER for the PEOPLE for the good of ALL.
When we voted leave on June 23rd 2016, I was astounded to learn that our Government led by David Cameron has been instructed to make no plans at all to leave. None.
But what’s more interesting to me is the amount spent on this referendum as published by the Electoral Commission.
Just read these figures and wheep …
Remain In the EU Campaign
Liberal Democrat’s £2.2m
Richard Branson £0.5m
Best for our future £0.4m
European movement £0.3m
Labour Leave £0.5m
Democratic Unionists £0.4m
TOTAL £16.95 million
Vote Leave the EU Campaign
Vote Leave £6.7m
Aron Banks £0.6m
Mr Harris £0.4m
Brexit Express £0.6m
Democracy Movement £0.4m
TOTAL £9.3 million
That’s a £5 million pound difference yet the British public still vote LEAVE.
What on earth does that tell you folks?
We could also talk about the £9.3 million pounds our elected Government (who should have been neutral in this matter) spent to send a glossy 14 page booklet to every household in the UK telling them why they should vote REMAIN.
And it still didn’t matter.
When oh when oh when will the ruling classes and the elite in this country recognise when there needs to be change and change needs to be led by working together?
The reason everybody is scared is because they all know that once we are out, then it’s just a matter of time before a toppling domino effect with France, Germany and Italy having their own referendums and also voting to come out.
I believe that from these ashes could be formed something magnificent that could really take shape and promise the Europe that many of us have dreamed of but which for the majority of us does not exist (except in dreamland…)
And I am absolutely sick and tired of so-called business and government leaders telling us that without The EU (note I didn't say Europe) that we are just Little Britain!
Come on people – let's be proud to be British. Show some spirit and backbone.
Here's just 10 things we invented here that CHANGED the world!
World Wide Web
railway steam locomotive
All on our own. Didn't need Uncle EU to help us out did we?
The vote happened and it was leave.
Whether people agree with it or not, it was a valid result that should ensure that we leave but why oh why are we still messing around at the 11th hour?
Again, we have another proposal another negotiation another vote that says no.
It is because in my honest opinion because our so-called leaders, our so-called democratically elected members of parliament have forgotten two things.
ONE – we the people voted to leave so you must do all that you can to make this happen even if you disagree with the decision (and if you seriously disagreed that much you can always resign as an MP and lose all of your cushy benefits can’t you?)
TWO – there is this thing that happened during the terrible world wars we had back in the day and it was called WORKING TOGETHER. I fail to see any of the parties working together and I believe they are all as bad as each other and ultimately – whether you’re in government or you’re not in government your voice SHOULD be heard in this awful time and you should bury your snide remarks, your upmanship, your ridiculous notions of power and work together on behalf of this country to demonstrate to us the people that you are listening, that you do care and that you are actually elected for the right reasons.
Right now, it seems that everything we hear about is the imminent end of the world but consider this.
I didn't notice the sun not getting up today nor people not going to work nor the electric/gas/water still not coming into my home and the Internet still works – so I'm thinking it might just be ok?
It is every MP’s and the Government’s CONSTITUTIONAL duty to act on behalf of the people we call English, Irish, Welsh and Scottish that make up the Union who by democratic right have voted to Leave the EU.
It’s really not that hard.
As I said way back in 2016, here’s what I would do if I was in charge …
10 point plan
Article 50 enactment set in place immediately (eventually we got there 29th March 2017 a full 9 months after the vote)
New budget with projected agreed redistribution of EU tariff including protection for NHS, education, farming and fisheries.
Trade agreements agreed with major trading partners and reclamation of our fishing grounds
Movement of people within Europe policy agreed
Immigration policy and border controls
Legal uncoupling from EU
Financial uncoupling from EU and stabilisation of London financial services
EU Grants/loans review of existing contracts with grandfathering in for agreed contract and formation of new grants body
Military reorganisation with uncoupling from EU forces where appropriate
Relaunch of Great Britain
I suggested at the time that MEP's probably won't have jobs for long so perhaps they could be utilised to help with transition, trade and foreign ambassadors and then offered appropriate roles in government to replace over paid and unnecessary quangos and consultants.
Quite simple really but then I'm just a businessman who likes to have a plan!
I am quite frankly sick and tired of MP’s postulating and trying to get air time to give their tuppence worth on the vote, the proposals, the vote, the proposals. Oh it is so dreary. Look at yourself in the mirror and ask yourself – do YOU have a vision for Great Britain in 2050 – what is it, what does it look like, where are we in the world, how are we impacting global issues, how you will be involved – and then bury the hatchet and open up meaningful deep honest and open dialogue between your parties. This is NOT the time for bi-partisan politics, this is the time for NEW GREAT BRITAIN.
I and 17.4 million people vote leave.
Let’s join forces, let’s get a plan and let’s get it moving!