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Five Common Rent To Rent Mistakes That Kill Deals · The Property Unleashed Podcast

• 0:00
  SPEAKER_00: The five mistakes I see so many people make when they want to build a rent-to-rent business.
• 0:17
  SPEAKER_00: Hello and welcome to the Property Unleashed with me, your host, Mark Fitzgerald.
• 0:20
  SPEAKER_00: It's great to have you joining me here.
• 0:22
  SPEAKER_00: So I thought it's about time here in well, we're in August 2026 that I did another five mistakes on rent to rent and building a rent-to-rent business because I still help and support a lot of people who are getting out there and they're building a rent-to-rent business through my training, the rent-to-rent business builder.
• 0:44
  SPEAKER_00: Well, you can see it's in the title there, can't you?
• 0:46
  SPEAKER_00: You're building a business in property.
• 0:48
  SPEAKER_00: Now, this has now helped hundreds of people start to build successful rent-to-rent business, whether that's with service accommodation or whether that's using HMOs, or sometimes even doing both.
• 1:02
  SPEAKER_00: But there are some fundamentals that you have to make sure that you have in place.
• 1:07
  SPEAKER_00: And there are also some mistakes that I keep seeing time and time again from a lot of people that, hey, have got out there and they've said, Well, I've done some rent-to-rent training, but they haven't done our rent-to-rent training.
• 1:19
  SPEAKER_00: And they've still made these fundamental mistakes because there's a lot of people out there that are selling outdated training, they're selling uh courses that have never ever done rent-to-rent themselves as well.
• 1:31
  SPEAKER_00: Whereas my training actually is I live and breathe it.
• 1:34
  SPEAKER_00: Why?
• 1:34
  SPEAKER_00: Because I do this strategy myself, so I make sure that it stays the most up-to-date it could possibly be.
• 1:39
  SPEAKER_00: And things do change.
• 1:40
  SPEAKER_00: So we update modules and everything like that.
• 1:42
  SPEAKER_00: But we also have the community as well, ETA as a community, where members of the training can stay in that community, can keep asking questions and keep looking and having support.
• 1:53
  SPEAKER_00: But there are still five things that I see time and time again for people that you know aren't lucky enough to be in our community or having our support.
• 2:01
  SPEAKER_00: And I wanted to go through those with you today so that you don't make those mistakes.
• 2:06
  SPEAKER_00: So, in no particular order, I'm going to go through these and just explain what I come across all the time when I'm speaking to people, when I'm meeting people, when people are looking at getting started with this, because rent to rent can be a great cash-flowing strategy when done correctly, but when not done correctly, it can also be a money pit.
• 2:23
  SPEAKER_00: You can lose a lot of money.
• 2:25
  SPEAKER_00: So you have to make sure that you don't fall or succumb to any of these five mistakes in particular.
• 2:32
  SPEAKER_00: So, at number one, the first thought is from everybody that you need a lot of money to do rent-to-rent.
• 2:39
  SPEAKER_00: Now, that's the wrong way about thinking about this strategy, if you like, because it is a cash flowing strategy, it's not about putting lots of money into other people's properties.
• 2:50
  SPEAKER_00: The most I've ever spent on an HMO rent-to-rent deal is£900, and that was to paint some walls and to change some carpets, which I try not to spend any money if I can, but£900 to get a property up and running that cash flowed me£550 per month when it was fully tenanted.
• 3:10
  SPEAKER_00: So you don't need large arrays and amounts of money for that.
• 3:14
  SPEAKER_00: Now, this was an HMO that would all had already been done up, already had the furniture, it was already a compliant HMO, and that's what you want to be focusing on if you're looking at the HMO route.
• 3:23
  SPEAKER_00: Serviced accommodation obviously is a bit different.
• 3:26
  SPEAKER_00: Now, with serviced accommodation, people still think they need large chunks of money because they have to put furniture normally in a property.
• 3:32
  SPEAKER_00: Normally you get a buy-to-let property, it's empty, you've got to furnish it, you've got to put everything in there.
• 3:38
  SPEAKER_00: Now, what you can do is lease that furniture.
• 3:41
  SPEAKER_00: You don't necessarily have to go out there and spend thousands and thousands of pounds up front furnishing it all.
• 3:47
  SPEAKER_00: You could lease the furniture, you can pay it off on a monthly fee, and that's a lot more cost-effective.
• 3:52
  SPEAKER_00: So to think that you need to have, you know, five, ten, fifteen grand to get started is incorrect.
• 3:58
  SPEAKER_00: I started with little to no money.
• 4:00
  SPEAKER_00: You will need a few quid normally to give it a bit of dressing, maybe to sort things out or to lease furniture.
• 4:06
  SPEAKER_00: But fundamentally, you do not need big, large chunks of money.
• 4:10
  SPEAKER_00: So get that out of your head.
• 4:11
  SPEAKER_00: If you are of the understanding that you're going to find a property, you're going to give it a refurb and do it up, then that's the old way of thinking.
• 4:19
  SPEAKER_00: That is the wrong way of thinking.
• 4:20
  SPEAKER_00: Why would you spend loads of money on somebody else's property?
• 4:23
  SPEAKER_00: If it needs work, you want to be negotiating with the landlord for them to give you that property to a good standard, and then you can maintain it to that standard.
• 4:34
  SPEAKER_00: The next one, number two, problem that I see a lot of people starting out doing is overpaying the rent, overpaying the landlords because they're desperate to get that first deal.
• 4:47
  SPEAKER_00: That is another mistake.
• 4:50
  SPEAKER_00: You have got to use a spreadsheet, a deal calculator, understand the costs, but equally to that, understand the rents and be conservative with the numbers.
• 5:00
  SPEAKER_00: And then you work out what you can pay the landlord.
• 5:03
  SPEAKER_00: And that is a number that you cannot really mess with.
• 5:07
  SPEAKER_00: You will normally go in a little bit lower, so you'll offer them a bit lower than you normally can, just so that you've got some wiggle room for negotiations.
• 5:15
  SPEAKER_00: But I wouldn't I wouldn't go in there and start offering more and more, but it cuts into your profits because it'll make the deal unviable and it's not the best way to go about business.
• 5:25
  SPEAKER_00: But I see a lot of people making mistakes that a landlord say they want£3,000 for a property, it's an HMO, and that's what they want.
• 5:33
  SPEAKER_00: You've ran your numbers and you could only pay them two and a half thousand pounds, but you're trying to fudge things, you're trying to look to put rents up, you're trying to look to change things.
• 5:42
  SPEAKER_00: That's the wrong way of going about it.
• 5:43
  SPEAKER_00: The offer is the offer.
• 5:44
  SPEAKER_00: Now, what you want to be doing, if the landlords are adamant that they want all of this money, then you need to be showing them what you bring to the table.
• 5:52
  SPEAKER_00: Now, on a rent-to-rent deal, you give them a guaranteed rent so they have no voids.
• 5:57
  SPEAKER_00: You're going to take care of the minor maintenance issues of the property.
• 6:00
  SPEAKER_00: So they're not going to have to put their money or their hands, sorry, in their pocket every other month or something like that for maintenance and minor maintenance costs and things.
• 6:09
  SPEAKER_00: So you're going to save them a lot of money.
• 6:10
  SPEAKER_00: So it's really imperative that you talk to them and you show that them what you're going to do for them and then let them appreciate what you're actually bringing to the table.
• 6:21
  SPEAKER_00: And this is something in my training I work very, very hard and understanding with our check sheets and everything that you go through to really make sure that the owners understand what you're bringing to the table.
• 6:32
  SPEAKER_00: So sometimes your rent might seem a bit less overall, but they're actually going to make more money over that time.
• 6:37
  SPEAKER_00: So show them if you're going to do a five-year agreement, show them over those five years exactly what they're going to be making because that can be a very, very powerful tool.
• 6:46
  SPEAKER_00: And while I'm on there with overpaying for landlords, also you don't want to be paying deposits on properties.
• 6:51
  SPEAKER_00: Remember, this is a business-to-business agreement.
• 6:54
  SPEAKER_00: I've never paid a deposit, and I wouldn't pay a deposit on a deal as well, because that's not what we're all about.
• 6:59
  SPEAKER_00: We're a management company and we don't pay deposits.
• 7:03
  SPEAKER_00: Okay, number three, it's using the wrong contracts.
• 7:07
  SPEAKER_00: I see a lot of mistakes where people come up to me and say, I've done a rent-to-rent deal.
• 7:11
  SPEAKER_00: What's your contract?
• 7:12
  SPEAKER_00: Well, I've used an AST.
• 7:14
  SPEAKER_00: Okay, now that an AST is what a tenant used to use.
• 7:17
  SPEAKER_00: They're now APTs, okay.
• 7:21
  SPEAKER_00: But people come to me, I've got an AST or I've got an APT now, and that's the agreement that I've got with the landlord.
• 7:28
  SPEAKER_00: So they're treating you like a tenant.
• 7:29
  SPEAKER_00: Now you can use those, and they can still give you have a caveat in those to give you the permission to sublet the property, but you don't want to be using those.
• 7:38
  SPEAKER_00: They're very, very weak.
• 7:40
  SPEAKER_00: They're not what you want to be using.
• 7:42
  SPEAKER_00: You want to be either using a management agreement or a commercial lease agreement with the landlord or even with agents.
• 7:49
  SPEAKER_00: If you're going through letting agents and doing this, you want to make sure you're using the right contracts.
• 7:54
  SPEAKER_00: And using an APT as it would be now isn't the right agreement to be making.
• 8:00
  SPEAKER_00: You want a management or a lease agreement, you want the relevant clauses in those contracts, you want the structure, the roles, and responsibilities, all wants to be defined.
• 8:10
  SPEAKER_00: So even if you have a management contract that you a letting agent uses, a management contract that you use for rent to rent will have a lot more details in it.
• 8:20
  SPEAKER_00: So it's not going to be the same contract there as well.
• 8:22
  SPEAKER_00: I supply all of my students with the relevant contracts.
• 8:27
  SPEAKER_00: Now, these contracts, if you were to have them drawn up, cost about 1200 pounds, I think they are now up to each.
• 8:33
  SPEAKER_00: I didn't pay that when I did it.
• 8:34
  SPEAKER_00: They were about 600-700 pounds, but obviously inflation.
• 8:38
  SPEAKER_00: But I supply all of my students with these contracts so that they know exactly what they need to have in there.
• 8:47
  SPEAKER_00: They can change them, they can go to solicitors and ask them to change them for a couple of hundred quid, but they've predominantly got those contracts, they've got legally binding contracts, and it's great for them to be able to understand this so that they are using the right contracts as well.
• 9:02
  SPEAKER_00: And like I say, you've got two contracts in there that come up to about£2,500.
• 9:08
  SPEAKER_00: Well, the training is not even that expensive, so it pays for itself over and over again.
• 9:12
  SPEAKER_00: But make sure, please, make sure that you use the right contracts.
• 9:16
  SPEAKER_00: The next one, number four, and this is vital for any rent-to-rent deal, whether it's service accommodation, HMOs, whether you're back-to-back leasing, whatever, you have got to make sure that you have a break clause in the agreement.
• 9:34
  SPEAKER_00: Why?
• 9:36
  SPEAKER_00: Oh, there's so many reasons why, but mainly the one thing is if the property does not perform how we've anticipated and we've expected, for whatever reason, you can issue the break clause, you can give the property back, and it's just good business.
• 9:55
  SPEAKER_00: If you're locked into an agreement and something happens, and all of a sudden that property's not performing the same, it becomes a liability in your business.
• 10:03
  SPEAKER_00: Now I have issued break clauses, I have given properties back that when I first did the agreements, they were brilliant properties, they were cash flowing really, really well.
• 10:14
  SPEAKER_00: Then a few things changed here or there.
• 10:16
  SPEAKER_00: The market changed, the situations changed, interest rates for the landlord went up, and all of a sudden it wasn't viable for them.
• 10:23
  SPEAKER_00: I've also had it with utilities when they went through the roof a few years back as well.
• 10:28
  SPEAKER_00: All of a sudden, we weren't making the same profits.
• 10:30
  SPEAKER_00: So I can issue the break clauses, I can give the properties back in the same condition that I've taken them on, if not better, and I can get more properties and do more deals.
• 10:39
  SPEAKER_00: Remember, this is a business.
• 10:42
  SPEAKER_00: This isn't just you grabbing a handful of deals and then just thinking that's it.
• 10:45
  SPEAKER_00: It's a business, it's living in and breathing.
• 10:47
  SPEAKER_00: So you will change your deals, you will change opportunities up, but you've got to make sure that you have a relevant break clause.
• 10:54
  SPEAKER_00: Now, the first deal I had was a 12, it was a five-year contract, but you couldn't you couldn't issue the break clause in the first 12 months.
• 11:01
  SPEAKER_00: Subsequently, now I have break clauses that are a six-month break clause.
• 11:05
  SPEAKER_00: I I issue the break clause and I have six months to give the property back.
• 11:09
  SPEAKER_00: And in that time, obviously, I can empty the property, I can do whatever I need to.
• 11:13
  SPEAKER_00: If that is, I normally phase that out if they want it back with vacant possession.
• 11:17
  SPEAKER_00: If it's service accommodation, it won't be a problem at all.
• 11:19
  SPEAKER_00: The other caveat to that is I sometimes have three-month break clause.
• 11:23
  SPEAKER_00: You can have whatever you want, just make sure you have one.
• 11:26
  SPEAKER_00: Not all of my contracts are landlords, have a break clause, so if they're locked into a five-year contract with me unless I break the agreement.
• 11:34
  SPEAKER_00: But equally to that, I have the break clause on my side.
• 11:38
  SPEAKER_00: So I normally put break clauses in, and then when the landlord, if they come back to me and say, Well, I would like a break clause as well, then that's not a problem.
• 11:44
  SPEAKER_00: We can put a break clause in there for you.
• 11:46
  SPEAKER_00: But I don't go openly out there and start talking about all of those things as well.
• 11:50
  SPEAKER_00: And at number five, and this is probably as important as all of the other ones as well, is think of rent to rent as a business.
• 12:00
  SPEAKER_00: Okay, it is a property investing strategy, and you don't necessarily just have to do rent to rent, and that's it.
• 12:06
  SPEAKER_00: You could do deal sourcing, you could do rent-to-rent, you could do purchase lease options.
• 12:10
  SPEAKER_00: Rent to rent is a great way to get purchase lease option opportunities because it's very similar, but you're just locking in a price to buy and you take on more control and responsibilities of the property.
• 12:20
  SPEAKER_00: But you've got to set yourself up as a business, and this is something that I work very closely with people myself.
• 12:28
  SPEAKER_00: You've got to have those, you've got to remember you're gonna be paying tax, okay?
• 12:31
  SPEAKER_00: You're gonna be having expenses, your properties aren't always gonna be full, so you will have void periods.
• 12:38
  SPEAKER_00: You need to be making a good profit, of course, and that's why it's important that you get your money right and you don't overpay the landlords, but you want to also be making sure in my business I like to have a pot for voids, I have a separate account and uh I call it a pot, but these are all separate accounts from the main account, one for tax, one for VAT, one for voids, and one for maintenance.
• 12:59
  SPEAKER_00: Now that's all my apart from the tax and the VAT, that's all my money anyway.
• 13:02
  SPEAKER_00: So it's just going into a separate account.
• 13:04
  SPEAKER_00: But then if I have voids and I have a problem or I have a maintenance thing, it comes out of that pot, and I just a little percentage of each of the times when the rents go through goes in there, and each of those pots just get a small percentage going in there for every payment that goes through.
• 13:19
  SPEAKER_00: So I know that I can sleep well at night and that I'm covered with everything.
• 13:22
  SPEAKER_00: So make sure that you set yourself up in that sense there, but also know that you're gonna have some time commitments to sorting things out, you're gonna have to make some phone calls, you're gonna have to repair minor maintenance things and stuff.
• 13:34
  SPEAKER_00: Get the systems in place, the people in place to be able to help you with that if need be.
• 13:38
  SPEAKER_00: But remember, set it up, as I always like to say, for success as a business, and you will be on the right track.
• 13:45
  SPEAKER_00: But if you can avoid those five mistakes, and I hope you can now that you've listened to this or or gone through this, get yourselves out there and make sure that you are winning.
• 13:55
  SPEAKER_00: And if you need any help and support with that, then we do have the rent-to-rent business builder, which is always getting updated when it needs to.
• 14:02
  SPEAKER_00: But I I personally would say that it's the best rent-to-rent training out there, most cost-effective, and it's got everything that you possibly need, as well as the ongoing support of ETA as a community.
• 14:13
  SPEAKER_00: And come and join us in ETA as well.
• 14:15
  SPEAKER_00: It's my property investing online community.
• 14:17
  SPEAKER_00: Visit thepropertyunleash.com, have a little look on there.
• 14:20
  SPEAKER_00: Hey, we've got some free tools and resources, got deal analysers as well that you can download, so spreadsheets that you can use to stack your deals and things, don't cost you a thing for all of that.
• 14:30
  SPEAKER_00: But then we do have some trainings, we do have the community, and at the moment we are helping people all the time.
• 14:36
  SPEAKER_00: And I do have a couple of places for one-to-one coaching as well.
• 14:40
  SPEAKER_00: If you really want to go and have that bespoken training, have me supporting you 24-7, then just reach out to us and let's have a little chat about it.
• 14:50
  SPEAKER_00: But I hope you've enjoyed this episode.
• 14:51
  SPEAKER_00: I hope you're not going to make any of these mistakes, and there's some of these mistakes you can take into just property investing as well.
• 14:56
  SPEAKER_00: You know, overpaying for properties, not using the right agreements, not locking in the right contracts and things.
• 15:03
  SPEAKER_00: So make sure that you are the property professional of 2026.
• 15:06
  SPEAKER_00: And if you need help and support with that, as I say, ETA has all of the trainings from lease options, rent-to-rents, essa, HMOs, back-to-back leasing, assisted sales, flipping properties, refurbish, you name it.
• 15:19
  SPEAKER_00: There's trainings in there to make you the property professional that you need to be in this time.
• 15:24
  SPEAKER_00: And I think we all need to be property professionals out there, don't we?
• 15:28
  SPEAKER_00: So if you've enjoyed this episode, please feel free to like, share it, subscribe to the channel.
• 15:32
  SPEAKER_00: Also, do leave us a review if you have enjoyed it.
• 15:35
  SPEAKER_00: If you haven't enjoyed it, don't leave me a review, please.
• 15:38
  SPEAKER_00: And I look forward to you joining me in the next episode very soon.
• 15:42
  SPEAKER_00: Take care and bye for now.