Anyone can buy a repossession and yes, any builder can do a refurb. The key is management and continued maintenance. Yes you will hear from every management agent….Leave it with me!

We recently sold a 5 bed en suite to a couple from Hong Kong. We suggested several management companies. One of which an Indian colleague of mine whom we worked on a 5 bed Professional HMO  had a very good relationship with the management agent….the other was a local Manchester agent whom we were disappointed from and told the investor that when purchasing another 5 bed Professional HMO. The story just seems to be going from bad to worse. We have professional HMO 4 bed en suite which has stayed full for the last 8 months. Several slight hiccups…one tenant fell behind and eventually left. But basically full and quiet. The reason being…MANAGEMENT!

My Indian client also has complete quiet in his 5 bed HMO in Warrington near a hospital. The reason being good management. This Professional HMO not that far from one of ours has empty rooms and offering rents below what we are achieving. I received an email yesterday regarding an issue with the boiler. Several months had gone by since we sold this 5 bed Professional HMO and then we were asked about the boiler that was in the HMO. Firstly it was under warranty for one year…yet the management agent billed the investor for works. More so we were asked to send out our plumber to check several issues last week. I believe it was the next day and he was there. He contacted the management agent and as of yesterday….had no call back……all boils down to management….All of these phone calls we receive to source property, these investors have been to one too many courses….They are missing reality. Yes, anyone can buy a property…yes anyone can refurb a property….The management is the key or break of the deal.

Had a similar story. We sold an investor from Saudi Arabia several Social Housing HMOs with guaranteed rents of 5 years…no voids…no management…and maintenance covered up to 5,000. We sold him these at 9% net yield. Fast forward a couple months, he told us he was buying HMOs in Liverpool because he could get 18% return. More fast forward…those properties have all kinds of voids and maintenance issues. No 18% promises ever came to reality.

All boils back down to management….That is what makes social housing so good. Yet the banks do not lend on them and we want to grow. We are starting a Turn Key property supply business.

Yesterday we started on a new track of investing. We are buying Buy to lets….in Liverpool & in areas of the North East…that we can refurbish…tenant…sell to investors in the 9-10% Gross yields cash on cash….that are fully mortgage able…meaning that if an investor wanted to utilise leverage their returns are in the mid to high teens depending on capital repayment or interest only. We will ensure management and maintenance that our investors will have quiet.

We had one offer accepted in Liverpool…and hopefully 2 more accepted this week. Our goal is to keep on supplying investors Social HMO properties…plus keep one of out 3…and with the Liverpool & North East properties is the same model…Sell 2 to investors…with high yields…BMV….still way below the 2008 prices…give double digit returns and keep one out of the three for ourselves for long term growth…

 

Plus had this emailed over

Best Places to Invest in Property UK 2017

  1. Liverpool

We mentioned buy to let in Liverpool in our previous post, the best places to invest in property in the UK. Liverpool is consistently a favourite city amongst investors and from a closer look at its credentials, it is not hard to see why. L1 is experiencing phenomenal growth yet house prices in the area remain low and the average home hovers at a modest £120,000. Liverpool is set to be a key player in the government’s “Northern Powerhouse” initiative and the transport network in and around the city is due to undergo major improvements. Additionally, the Northern Powerhouse scheme aims to stimulate new business development in the north, attracting professionals to the area who will require accommodation.

 

thoughts and comments?