Latest / The Property Unleashed Podcast / How To Get Landlords Wanting To Work With You, Rent 2 Rent Insider Tips

Transcript

How To Get Landlords Wanting To Work With You, Rent 2 Rent Insider Tips · The Property Unleashed Podcast

• 0:00
  Speaker 1: Why would a landlord agree to do a rent-to-rent deal with you?
• 0:03
  Speaker 1: Hello, my name's Matt Fitzgerald.
• 0:15
  Speaker 1: It's great to have you joining me here today.
• 0:17
  Speaker 1: So a question I get asked all the time is why would a landlord, or potentially a letting agent, want to do a rent to rent deal with you?
• 0:27
  Speaker 1: Let's cover some of the opportunities out there right here right now, and why?
• 0:32
  Speaker 1: Yes?
• 0:33
  Speaker 1: Why they will want to work with you, and not only want to work with you, but be happy to throw you the keys to their property, because you may very well have an answer to a problem that they have.
• 0:45
  Speaker 1: So, firstly, let's just remember that we are looking for people who have a problem.
• 0:51
  Speaker 1: So if somebody owns a property right here and they have a problem with that, they can't get tenants in there or clients or whatever.
• 0:58
  Speaker 1: They're trying to look after it.
• 0:59
  Speaker 1: So if it's an HMO, which is a house of multiple occupation where it's rented out by the room or a serviced accommodation, they may be struggling to get the relevant people into the properties.
• 1:09
  Speaker 1: Now, sometimes that can be because people get in their own way.
• 1:15
  Speaker 1: So you will see and I see this all the time a lot of old school landlords that do not move along with the times.
• 1:22
  Speaker 1: So they do struggle to start letting their properties out.
• 1:26
  Speaker 1: Why?
• 1:26
  Speaker 1: Because their properties were maybe good 5, 6, 7, 8, 10, 15 years ago in some cases, but right here and now they're just dated, they're looking old, they're looking grubby and there's better product out there.
• 1:40
  Speaker 1: There's a lot of savvy investors out there at the moment that need our services if you are a rent-to-rent operator.
• 1:47
  Speaker 1: Why?
• 1:48
  Speaker 1: Because they're spending a lot of money on the properties that they're putting together.
• 1:52
  Speaker 1: So, with us coming in, maintaining their property to the highest standard and that's what we want to be doing and looking after their properties as if they're our own, taking care of all of the hassle, people like that are more inclined to want to start working with us.
• 2:08
  Speaker 1: But you will find that there are a lot of old school landlords at the moment that don't like all the changes that keep happening.
• 2:16
  Speaker 1: You know government seems to every month be announcing some sort of change to you know landlords in the UK at the moment there's always some sort of restriction, some sort of licensing, some sort of compliances that they don't look and run their properties as a business.
• 2:34
  Speaker 1: They just look at it really as a hobby.
• 2:37
  Speaker 1: This just makes me money.
• 2:38
  Speaker 1: It's always made me money.
• 2:39
  Speaker 1: Now, in these times, you want to be looking and running your property empire as a business.
• 2:46
  Speaker 1: Why?
• 2:47
  Speaker 1: Because it is a business.
• 2:48
  Speaker 1: Okay, there will be changes.
• 2:50
  Speaker 1: There will be, you know, regulatory changes out there that the government are going to make and we have to be able to roll with those changes, to roll with the punches, so to speak.
• 3:01
  Speaker 1: And if you're an old school landlord and you're just thinking they've got it in for me with that mindset and that attitude, you are going to struggle.
• 3:08
  Speaker 1: So a fresh pair of eyes, a fresh perspective on their property could be that all it needs is a lick of paint, some furnishing, change it around, maybe some new furniture in there, and you could have a very, very profitable property, and of course we can go in there and do that.
• 3:24
  Speaker 1: Have a very, very profitable property, and of course we can go in there and do that.
• 3:27
  Speaker 1: Some people are very narrow-minded, and also some people as well who are getting into rent-to-rent think, well, why would somebody give me the property?
• 3:35
  Speaker 1: Why wouldn't they just go and do it themselves?
• 3:37
  Speaker 1: Well, some people are tired, some people don't want to spend the money, some people just cannot see it.
• 3:43
  Speaker 1: They need somebody else to go in there and help them to see that the vision and the way that people want to rent properties and live in properties is evolving.
• 3:53
  Speaker 1: It evolves all the time.
• 3:55
  Speaker 1: So a property that was good maybe six, seven, eight years ago right now is an older looking property.
• 4:02
  Speaker 1: It's a property that you may attract less desirable clients to If you can keep it clean, keep it bright, keep it vibrant and look to give people an experience.
• 4:14
  Speaker 1: People now don't just want to pay for a roof over their head and live in a room or a property.
• 4:19
  Speaker 1: They want to pay for an experience and people will pay a premium as well for the experience.
• 4:25
  Speaker 1: Co-living properties are really popping up now and are doing well.
• 4:30
  Speaker 1: If you can get hold of an old property and I don't spend a lot of money on my properties when I take them on, when I do refurbs and things like that, we try and spend as little as possible.
• 4:41
  Speaker 1: The most I've ever spent is £900 and that was for some painting and some carpets, and I teach my students how to do the same.
• 4:47
  Speaker 1: But if you can get your hands on a property, that could potentially make you, you know, between £500 and £1,500 per calendar month and you had to put a bit of money into it, not thousands and thousands, maybe a thousand, maybe 1500 quid, maybe a couple of grand into it, but it could produce you 800, 900 pounds per calendar month.
• 5:06
  Speaker 1: It's worth doing.
• 5:07
  Speaker 1: So.
• 5:08
  Speaker 1: We don't want to be short-sighted ourselves either.
• 5:10
  Speaker 1: We don't want to be going in there and knocking down walls and going back to brick and things.
• 5:14
  Speaker 1: We want to be taking on as good of properties as possible, and that's another thing I do help and teach my students how to do is to find the best deals so that they are getting them cash flowing straight away.
• 5:24
  Speaker 1: But you want to make sure that you're finding good properties that are in a good location will rent very, very well, and if you have to spend a few quid and just get them up to a better standard, then do so Because at the end of the day, it's not cost you a deposit, has it?
• 5:41
  Speaker 1: It's not cost you maybe 50, 60k to buy the property.
• 5:45
  Speaker 1: It might cost you a few thousand pounds, which you can get a loan, credit card, whatever.
• 5:49
  Speaker 1: However, you want to do it, use a joint venture or a family, friend or something like that and pay them back.
• 5:54
  Speaker 1: You can do that to just put this modest bit of money in and then control that property for three to five years.
• 6:01
  Speaker 1: Okay, so that's one of the things.
• 6:03
  Speaker 1: Obviously, there's always tax changes coming as well.
• 6:05
  Speaker 1: Section 24, which was introduced in 2017 and is in full flow now, means that landlords cannot claim back the tax benefits that they used to do by having rental property.
• 6:20
  Speaker 1: So what does that mean for them?
• 6:22
  Speaker 1: Well, some of them now, because it's taken on their gross profit means that they are potentially being pushed into the higher rate tax bracket and, of course, that's then cutting into their profits Well, massively.
• 6:36
  Speaker 1: At the end of the day, I mean somebody who's got all of their properties in their own name all of a sudden could have been a lower rate taxpayer and has now been put into that higher rate taxpayer, and that can cut your profits in half, so it can completely change the way that you'll live in.
• 6:49
  Speaker 1: It was a massive, massive thing when it was introduced.
• 6:52
  Speaker 1: A lot of people now, of course, are moving into having their properties in a limited company, which is more tax efficient, and sometimes it's actually a saving to take property that is in your own name, pay what it costs to put it into a limited company, just to do so because of the tax benefits in the future.
• 7:10
  Speaker 1: Ok, so I'm not here to talk to you about tax and everything.
• 7:14
  Speaker 1: Obviously, if you do need tax advice or financial advice, then please do seek out the relevant parties to do so.
• 7:21
  Speaker 1: Reach out to me.
• 7:21
  Speaker 1: I can always point in the right direction for the right specialists as well.
• 7:26
  Speaker 1: So there's always uncertainty in the economy, interest rates rising over the last 18 months or so, which was inevitable.
• 7:35
  Speaker 1: Let's be right.
• 7:36
  Speaker 1: We had it good for a long, long time after the credit crunch of 2007, 2008.
• 7:41
  Speaker 1: Interest rates were so low everybody started to get used to it.
• 7:46
  Speaker 1: And now let's be realistic.
• 7:47
  Speaker 1: When I first bought my first property, the interest rate on that mortgage was just under just under 6% and it was a good deal.
• 7:57
  Speaker 1: It was a good deal at the time.
• 7:58
  Speaker 1: So where we are right here?
• 8:00
  Speaker 1: Right now, depending on when you're watching this interest rates have gone up and some landlords have just bought over the last 15, you know, 16 years and thought the interest rates are never going to change.
• 8:11
  Speaker 1: Of course that's gone up now and it's made life more difficult for them.
• 8:14
  Speaker 1: Of course, that means uncertainty for certain people.
• 8:17
  Speaker 1: We can go in there, offer them a guaranteed rent Now.
• 8:20
  Speaker 1: Obviously they have to have a problem, as I've said before, and if their problem is that their mortgage is so high now the rents don't cover it, which is normally just on a buy to let property, not an HMO or a serviced accommodation, then they've got a problem anyway and we potentially can't even help them with that problem.
• 8:37
  Speaker 1: Maybe we can point them in the right direction, maybe not.
• 8:39
  Speaker 1: But I always like to say this, just to get this out to everybody is we do not take advantage of anybody who's got a problem.
• 8:47
  Speaker 1: We look to see if we can solve their problem and make it a win-win.
• 8:51
  Speaker 1: Always, always important to make sure that you never take advantage of anybody, that you look to serve and help people.
• 8:58
  Speaker 1: Okay, those are the best deals.
• 8:59
  Speaker 1: We want to be able to sleep at night, don't we?
• 9:02
  Speaker 1: So the market is always changing.
• 9:04
  Speaker 1: Demand in the market changes as well, and that can be area to area depending on where you are.
• 9:09
  Speaker 1: Where I am now, people do expect a bit of a higher standard.
• 9:14
  Speaker 1: Ok, so where you are, you may just need to go more down that sort of co-living, higher end HMO route.
• 9:20
  Speaker 1: Nobody wants to be at the bottom of the market and that is where it's saturated and seriously busy and competitive.
• 9:27
  Speaker 1: So if you are looking at potentially, you know, getting into the HMO market, then you do not want to be sat down at the lower end.
• 9:34
  Speaker 1: Now social housing is another buzzword at the moment that people are all sort of grabbing onto.
• 9:39
  Speaker 1: I want to do social housing and I don't have to do anything if I do social housing and all of this and all of that.
• 9:44
  Speaker 1: I would just say with social housing, make sure it's a reputable company, make sure you've done your due diligence on that company and if they're offering you rents potentially that are massively above market value, then be very, very careful with that.
• 9:57
  Speaker 1: I've seen a lot of people come unstuck, but likewise I've seen a lot of people do very, very well out of it.
• 10:03
  Speaker 1: But local housing associations is a great way, of course, as well as lease to leases.
• 10:09
  Speaker 1: But I like to control the properties myself.
• 10:12
  Speaker 1: I like to put professionals in my properties as much as possible.
• 10:15
  Speaker 1: We do have some student lets as well and we want to make sure that we are managing those students, those clients, those customers of ours as best we can to make sure that they stay longer and they're happy, but they will pay a bit more of a premium for that service.
• 10:31
  Speaker 1: So don't just think you've got to get a property.
• 10:32
  Speaker 1: You've got to match what everybody else is doing and then you've got to hope for the best.
• 10:36
  Speaker 1: Go there, put your own stamp on a property.
• 10:39
  Speaker 1: So, whether or not you've got a property that's brand newly refurbished, it's in great condition, which is what we always recommend that you look for.
• 10:45
  Speaker 1: You want to also make sure that you put your own stamp on there, so people really do want to live there.
• 10:51
  Speaker 1: We have a little bit of a waiting list Now.
• 10:53
  Speaker 1: When I say a waiting list, people aren't there all in a queue outside our properties waiting to move in.
• 10:58
  Speaker 1: But we do have a list where people are allowing us to reach out to them when somebody wants to hand their notice in, when somebody wants to move on, and then we reach out to them and see if it's feasible or not, or whether they're in a new contract, as to whether or not they can move in.
• 11:12
  Speaker 1: But that is great.
• 11:13
  Speaker 1: It shows that we are doing a good job and of course, we want to make sure that we're always doing a good job out there, a for our tenants, our customers, our clients and, of course, for our landlords as well.
• 11:30
  Speaker 1: So there's a lot of reasons why landlords right here right now will want to work with you.
• 11:32
  Speaker 1: Okay, and this is what we are seeing as well on the Rent2Rent business builder training program, where I coach you, support you and give you all the tools and training to get out there and do these good deals.
• 11:42
  Speaker 1: We are seeing great results out there.
• 11:45
  Speaker 1: We are also seeing that there are a lot of landlords out there at the moment who just maybe aren't motivated enough to want to do those deals, but you have to be, as they say, in the game to actually go out there and get those deals.
• 11:58
  Speaker 1: So a lot of my students are getting deals, but they're also talking to landlords and agents at the moment that maybe aren't motivated enough to do the deals that we're offering.
• 12:07
  Speaker 1: But I tell you what the money, as they say, is in the follow up.
• 12:10
  Speaker 1: So if you are doing things like that, you have to make sure you've got an excellent follow up procedure OK.
• 12:16
  Speaker 1: You need to make sure that you're constantly following up, not being annoying, but doing it in such a manner that they understand that you are genuinely there trying to help and support them and if we go with that, we try and help and support anybody that we can, then we will do the best deals, we will build a profitable business and we will be able to sleep at night, and those are the things that we want to do.
• 12:40
  Speaker 1: If you need any help and support on this, then please do check out my website, thepropertyunleashedcom, where we have free tools and resources to help you there.
• 12:51
  Speaker 1: We have training as well.
• 12:52
  Speaker 1: We have paid training, we have mentoring, we have support to make sure that you're doing the best deals possible, you're getting out there and you're achieving your goals, and we don't just say we give you support, like a lot of other people do.
• 13:05
  Speaker 1: We genuinely give you support.
• 13:07
  Speaker 1: If you message me or you message us, then you will get a reply straight away.
• 13:11
  Speaker 1: I check the numbers of my clients, of my students, when they're doing deals to make sure that they're only doing good deals.
• 13:19
  Speaker 1: We are here to help and support you in any way that you need.
• 13:22
  Speaker 1: So do make sure that you reach out to us if you feel you need it and, if not, like, subscribe or share these videos and these podcast episodes, because we're putting them out there all the time to make sure that you're only doing the best property deals you can.
• 13:37
  Speaker 1: So I'll see you, or I'll be in your ears, in the next episode.
• 13:43
  Speaker 1: Take care.
• 13:43
  Speaker 1: Bye for now.