Why do you need a team?

Because Property cannot be done on your own. 

Lets look at if you did it all on your own. 

Firstly you’d need to find a property, then you’d need to value it, then search around for the best mortgage, then process the legal paperwork, carry out all the searches, do the building work, find tenants, service the boilers, do the little odd jobs that crop up etc etc.  Sounds like a lot of hard work to me. Creating a team is paramount to your achieving more in property. 

As Robert Allen said in the 1 Minute Millionaire about teams expanding your business. There is one very important calculation to remember:  

1+1 = 11 not 2 

So what I suggest you do now, is go get some paper and a pen – and brainstorm everybody who you feel should be in your team. 

Once you’ve done this, then read on for my recommended list of 8 power players that NEED to be in your team!

Mentors

Ideally, you should get to know as many people as you can to offer youguidance and advice when you need it.  My mentors include a commercial property developer, a venture capitalist and a wide selection of entrepreneurs. I also count many famous authors and speakers as my mentors. 

Your mentors do not need to be into property but they should be people who can help point you in the right direction when you inevitably become unstuck. Find good people that you can trust when you need some guidance on:

– Business advice

– Family advice

– Health advice–

 Spiritual advice

– Time management advice 

You can find mentors everywhere. You should always be expanding your contact base so look carefully for people that may make good mentors. 

Here is what I’d recommend looking for in a good mentor:

– Friendliness

– Patience

– Success

– The ability to teach

– Experience

– Approachability

– Sense of humour

– Contacts 

How do you reward them?

Your time, skill and enthusiasm OR pay them. I’ve used both methods and pretty much always had good results. 

Finders

 “How do I work with finders?”

 Finders are usually enthusiastic, out going people so they will certainly not object to an approach from a fellow property entrepreneur. 

It really helps if you are cash rich (or have access to a funds through your investors). Finders will want you to get the deals closed quickly because their reputation will always depend upon you moving quickly and sticking to your word. 

If your finder finds you a good lead go look at it immediately. If the deal is unsuitable remind them of your requirements and thank them for their time  Be sure to keep in regular contact and pay surprise bonus payments if your Finder delivers on a particular good deal for you. 

Look after your finder and your finder will look after you. 

The good finders usually only work for a select few developers or private investors so they may be difficult to approach at first but keep trying. Meet them and let them know you are serious. If you are not in a position tomove quickly on deals then it would be advisable to let the finder know from the outset! 

“How do I find a finder?”

 1) Property Sourcing Companies.  Usually charge a hefty commission and I’d be worried if their sole business relies on finding properties to sell to investors. If the deals are so good, why are they selling them on for a 2% finder’s fee instead of raising their own finance and keeping them for themselves?  (although I partner with another investor where we run our own property sourcing business purely because we have enough properties now to worry about – have a look at www.propertydiscountclub.com for more details). 

2) Independent Finders.  Usually these are people with very little money but lots of time, enthusiasm and knowledge to find properties for others. You need to work with people that bring you leads as you won’t have the time to run your business and find all the leads you will need. 

• networking efforts in your local area.
• auctions
• advertising in property related magazines and newsletters
• Internet forums for finders

 Let people know that you pay a generous finders fee plus a bonus payment for especially good deals 

Estate agents

Whether you like agents or not, you will have to work very closely with them if you want to generate a consistent stream of leads. They will become your ‘eyes and ears’ on the ground so learn to use them to your advantage. You must integrate good agents into your team, keep in regular contact and treat them just like you would a good friend. 

“What is the job of a good estate agent?”

To save you time and offer significant leverage. You tell the agent exactly what you are looking for so that when a suitable instruction comes up you should be first in line to view. 

You should be very specific with the agent in terms of what you want,

– The area (get it down to individual streets and roads if possible)

– The type of property

– The condition of the property

– The approximate price range

– Anything else like development potential or age 

You want to get to the point where the only time you are contacted by your agent is when he or she has a good lead that fits all your previously stated requirements. 

What are agents looking for in an investor? 

Answer: Market knowledge, a proven track record and the ability to movequickly when the right deal comes along. 

“Perception is Reality”

Perception is EVERYTHING in business. Dealing with estate agents is all about image, perception and persuasion. Estate agents just want their commission at the end of the day and it is up to you to make them THINK you are serious, experienced and ready to move quickly. The majority of the best deals from estate agents will be broken chains.

You need the following 3 things to be able to move quickly,

1. Ready to go finance – either mortgage or cash.

2. Superior market knowledge – you need to know the market better than any estate agent.

3. A friendly builder or handyman/woman to help you cost up any worksrequired to bring the property up to scratch.  

Private Investors

The golden rule of working with private investors is to start small, build a reputation for consistency and only ask for funding that suits your experience and relationship with the potential investor. Tell them the truth and explain what you are trying to do  

If you are enthusiastic, mature, passionate, knowledgeable and above all reliable and trustworthy, private investors will want to work with you.  Above all else they want to know their money will be safe in your hands. If you can regularly come up with the goods and offer your investors a respectable rate of return on their money there is no reason why they will not work with you. 

In my experience, most investors will look for 10%-30% gross return per annum.This will vary greatly depending upon:

– How quickly you need the money

– How long you need to borrow the money

– Why you need the money

– Whether you can offer security or not

– Your history with private investors

– Your history and experience as a developer

– The requirements and expectations of the investor

“How do I find private investors?” 

Where do you find them?

• Family and friends
• Property Networking Club
• Business link
• Chamber of commerce
• Rotary club
• Business angels
• Internet investment forums and chat rooms

Call regularly and keep in contact. Attend any free meetings to network with potential investors and get your face known.

Join local business clubs and associations. Don’t just write a letter and forget about them, pay them a visit, direct them to your website, give a short speech if they will let you. Persist, persist, persist, persist, persist, persist, persist, persist, persist,persist, persist and persist some more! 

Careful, well thought out persistence is the key to making it with private investors. Keep them informed of all your deals and even if they do not invest with you, you will be in their mind as an active developer.

Builders and tradesmen

Always fix the price and the EXACT specifications of the work you want thebuilder to carry out, what exactly will need to be done and by when.

Be very specific and get everything down on paper. Hand your builder a signed copy and keep one for yourself

– Go on recommendation (don’t just pick a builder from the yellow pages!)

– If you have any doubts, do not use them – always follow your gut instinct.

– Cheap handymen/women are preferable to professional builders where small cosmetic works are required (painting, plastering etc)…

– Use a time contract. I.e. “you will complete the work within 3 weeks. I willthen charge you £50 for every day that you overrun”.

– Always use a legally watertight, written contract.  

Co-ordination is the key. Be polite but firm with trade’s people at all times and ALWAYS withhold fullpayment until the job is completed (to YOUR satisfaction not theirs). 

It is common for you to provide money up front (for materials and sometimescalled a ‘float’) but never, ever hand over the full amount up front because youwill be lucky to get your job finished on time or to your satisfaction. 

Mortgage broker

You need to look for somebody that can ideally get your money to you when you need it – i.e. FAST! 

If you are buying from motivated sellers, which you will be, you will need a ‘red hot’ broker. It helps if your broker is local to you, but this isn’t essential. Much of your communication will be via email or phone anyway.

What is essential is to check that your broker subscribes to the ‘mortgage code’ by asking him for hisregistration number. If you are unsure, check the following website http://www.mortgagecode.org.uk/ 

As always, when looking for people to join your team, you should go on recommendation. Ask your contacts…

• Who do your investor friends use?
• When you meet other investors or developers at auction ask them whom they would recommend.

“Should I use a broker that charges me a broker fee?”

I have used both fee charging brokers and non-fee charging brokers and my experiences have been quite good for both because I only work with people that have been recommended to me. 

All mortgage brokers will receive a fee from the lender when they introduce a borrower (you) to a lender. This is separate to the fee he/she might charge you. 

Solicitor

Finding a good solicitor is much the same as finding a good broker. Talk to your developer and investor contacts and always go on recommendation. If you are getting anything unusual done make sure you agree a fee before any work begins. Ask for details of 5 of their clients and make sure you call them up.

• Ask the customer how long he/she has used the solicitor…
• Ask about the service and reliability.
• Any nasty surprises?
• For how many years has the client used the solicitor?

 Again, you can use a lawyer situated anywhere in the country but I would prefer to have mine close by since I like to visit him every now and again for a chat. 

Accountant

Your accountant is a very important member of your team. As always, make sure they are actively involved in property investment, or works with a number of clients that do. If you are not happy with the accountants that have been recommended by others, interview a few and ask them for references. 

Call up their recommended clients (preferably property investors) and ask them if the accountant is up to scratch when it comes to property related entities and tax avoidance strategies. As an active investor/developer, you will need to look for a proactive accountant, not a glorified bookkeeper or somebody who just fills out your tax returns once a year. 

Insurance Broker

You would be well advised to find and retain a good insurance broker.  Insurance brokers are much like mortgage brokers, in that they have access to a huge range of insurance products. Your broker will ask you what you intend to do with the property, who will be living there, whether you own it or your company does and a whole host of other questions, before going out and finding you the best product for your situation. As always, go on recommendation.