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How To Secure Serviced Accommodation Deals · The Property Unleashed Podcast

• 0:00
  Speaker 1: How to get service accommodation deals.
• 0:02
  Speaker 1: Hello, my name is Marffus Jarrett.
• 0:14
  Speaker 1: It's great to have you joining me here today.
• 0:16
  Speaker 1: So in this video today, I'm going to dive deep into how you can get your service accommodation deals.
• 0:23
  Speaker 1: Service accommodation is absolutely booming at the moment and a lot of people say is it saturated?
• 0:30
  Speaker 1: Well, yes, it is saturated, but it's also saturated with a lot of rubbish.
• 0:34
  Speaker 1: In most markets you could say there are saturation in areas, but there's also areas and fields that potentially not everybody's looking at.
• 0:44
  Speaker 1: A lot of people are looking at the city centers.
• 0:47
  Speaker 1: They're looking at the low hanging fruit there or thinking that is what they should be looking at when it comes to service accommodation.
• 0:53
  Speaker 1: I don't think you should.
• 0:55
  Speaker 1: I think, as a property professional which we should all try and be the best property professional in our areas we should be looking at niche markets.
• 1:04
  Speaker 1: We should be looking at certain clientele that we want to put into our properties and then going out there and finding the right properties for the clientele.
• 1:13
  Speaker 1: Why?
• 1:13
  Speaker 1: Because that will make you different from everybody else.
• 1:16
  Speaker 1: That will not be a saturated market and that will really, really help you when it comes to doing those deals.
• 1:23
  Speaker 1: So, fundamentally, there's four different ways that you can do service accommodation deals.
• 1:27
  Speaker 1: Most people will hear rent to SA.
• 1:30
  Speaker 1: Now when I say SA, that's Airbnb, holiday, lets, that short term rentals.
• 1:36
  Speaker 1: Service accommodation is the terminology I like to use and we'll use in this video with you.
• 1:41
  Speaker 1: But there's four different ways you can do service accommodation, and rent to rent is one of them.
• 1:46
  Speaker 1: A lot of people will be telling you the best way and easiest way to get into SA service accommodation is via the rent to rent strategy.
• 1:54
  Speaker 1: Now, if you haven't got a lot of money and you cannot purchase properties, it is a great strategy to use, but it's not the only strategy that you should be looking at and using as well.
• 2:05
  Speaker 1: So what are the four different ways to do service accommodation?
• 2:08
  Speaker 1: Well, one is rent to SA.
• 2:10
  Speaker 1: So that is where you get a landlord's property.
• 2:12
  Speaker 1: You take the property on as if it's your own.
• 2:14
  Speaker 1: You give the landlord a guaranteed rent, you pay for minor maintenance, you pay for the utilities and things and you basically look after that property as if you own that property.
• 2:23
  Speaker 1: Then you make your money using it for service accommodation.
• 2:27
  Speaker 1: Now I'm going to talk about and I have talked about in a few other videos as well what you need to look for when doing those sorts of deals when it comes to compliances, when it comes to making sure that you're allowed to do rent to rent or you're allowed to do service accommodation on those properties.
• 2:42
  Speaker 1: So check out that video at the end of this one.
• 2:45
  Speaker 1: Okay, and if you need any help and support with your service accommodation journey, then please do check out thepropertyunleashedcom.
• 2:52
  Speaker 1: Scroll down to the free resources tabs, click on that.
• 2:55
  Speaker 1: We have a 10 step service accommodation guide and we have a free service accommodation masterclass which will also help you with your compliances in setting up your service accommodation units and business.
• 3:07
  Speaker 1: So I hope that helps you, but don't head over yet.
• 3:09
  Speaker 1: Head over after this video if that's where you want to go.
• 3:13
  Speaker 1: So the next one is management.
• 3:16
  Speaker 1: Like a letting agency, you can offer service accommodation lettings where you take about 20% of all of the profit that you make.
• 3:24
  Speaker 1: Now why would you want to do it as a letting agent?
• 3:26
  Speaker 1: Well, if you do rent to rent, you're pretty much a service accommodation lettings business, so you can slot lettings, rent to rent deals and have a mixture of both if it suits you, and that's something that we show our students how to do and that means that they can go in there and look different from everybody else.
• 3:44
  Speaker 1: It also means that their growth in their business is massive and it is very, very fast.
• 3:50
  Speaker 1: Why?
• 3:50
  Speaker 1: Because if you do management, you don't have to pay a guaranteed rent, you don't have to pay utilities, you don't have to pay minor maintenance.
• 3:57
  Speaker 1: The landlords or the homeowner takes care of all of that.
• 4:01
  Speaker 1: You take care of the management side of things, so you're advertising and everything like that.
• 4:05
  Speaker 1: Now, if you don't make money on the property, you don't make money.
• 4:09
  Speaker 1: So it's in your interest to make sure that you're getting plenty of bookings and the landlords making good profit.
• 4:13
  Speaker 1: Why?
• 4:13
  Speaker 1: Because if they're making good profit, so are you.
• 4:15
  Speaker 1: So that can be a very powerful strategy.
• 4:18
  Speaker 1: The next one is joint ventures.
• 4:19
  Speaker 1: You can do joint ventures with landlords, with people you know that potentially own property, and you could split it 50-50.
• 4:26
  Speaker 1: Now, on that front I would say you know the person who you're doing the joint venture with brings the property.
• 4:31
  Speaker 1: Okay.
• 4:32
  Speaker 1: You bring the management side of things and how it's going to operate and work and you work together.
• 4:38
  Speaker 1: You maybe split utilities, you maybe split all the costs 50-50.
• 4:42
  Speaker 1: As a management fee, you maybe offer them a lower management fee.
• 4:46
  Speaker 1: Why?
• 4:47
  Speaker 1: Because it's part of your business as well.
• 4:48
  Speaker 1: And then, after everything's been paid ie mortgages, if it's mortgage utilities, minor maintenance and management you both split the profits 50-50.
• 4:57
  Speaker 1: That can work very, very well, but you do need to know I can trust the person that you do these deals with.
• 5:03
  Speaker 1: And of course, the fourth one and final one and method of doing things is if you own the property.
• 5:08
  Speaker 1: So maybe you're looking at buying properties to do service to accommodation on.
• 5:12
  Speaker 1: Or maybe you already have some buy-to-let properties that aren't performing so well now because of the high interest rates.
• 5:19
  Speaker 1: So you're thinking to yourself I need to make more money.
• 5:21
  Speaker 1: The higher interest rates are crippling me.
• 5:24
  Speaker 1: Maybe I can convert this and try service to accommodation.
• 5:27
  Speaker 1: Now do make sure you check with your mortgage providers or the mortgage providers of your landlords that you're allowed to do and operate as a short-term rental service to accommodation property.
• 5:39
  Speaker 1: If you set all of this up and you get caught doing it, they could potentially ask the landlord or the homeowner for the mortgage to be paid off.
• 5:47
  Speaker 1: They could potentially lose the property.
• 5:49
  Speaker 1: It could end up very, very awkward and, of course, if you put money into the property and furnish the properties, then of course you could also lose the investment that you put in as well.
• 6:00
  Speaker 1: Same goes for leases.
• 6:01
  Speaker 1: So if it's a leasehold property maybe an apartment or even a house on a leasehold, does it state that you're allowed to do short-term rentals, service to accommodation in the lease, or does it state that that's not allowed?
• 6:12
  Speaker 1: And again, don't just take landlords word for it.
• 6:15
  Speaker 1: Ask to see the lease yourself, because I've seen people take on properties, spend a good few thousand doing them up, start to do short-term rentals.
• 6:25
  Speaker 1: The neighbors have complained.
• 6:26
  Speaker 1: Then the leaseholder or the lease company have come back and said you're not allowed to do this.
• 6:30
  Speaker 1: It needs to cease straight away.
• 6:32
  Speaker 1: All of a sudden, then you put all this money into a property and you're not going to make any money out of it.
• 6:37
  Speaker 1: Yes, you may be able to keep the stuff, but that's not going to help you and that's not good business sense.
• 6:41
  Speaker 1: So it's very important to get that sorted at the beginning, okay, and, of course, make sure that you set yourself up for success.
• 6:48
  Speaker 1: So you need to be getting out there, okay, you need to be meeting people when you're looking for deals Now, whether that's you're going to buy the properties or whether you're going to do a rent to rent, or whether you're going to do offer management or you're looking for joint ventures that you can work with landlords and things like that, or even agents Okay, letting agents.
• 7:07
  Speaker 1: You need to be getting out there, you need to be sending out marketing material and you need to have marketing material on you as well.
• 7:14
  Speaker 1: Have business cards, please, please, please.
• 7:17
  Speaker 1: Have a business card, a physical card that you can hand to somebody, like I have in my hand now, that you can hand to somebody that can go on their desk.
• 7:27
  Speaker 1: Don't just have one of these new fangled cards that you tap on people's phones and your details go in there.
• 7:34
  Speaker 1: They are very cool, they are very good and by all means, have both, but you're easily forgotten.
• 7:40
  Speaker 1: Think about it and I get this at networking events all the time.
• 7:44
  Speaker 1: Somebody wonders over can I, can I give you my details?
• 7:46
  Speaker 1: Yeah, let's have your details.
• 7:48
  Speaker 1: They tap it on my phone and I tell you what.
• 7:50
  Speaker 1: By the time I've finished that networking event, I've forgotten about them.
• 7:53
  Speaker 1: Okay, out of sight, out of mind.
• 7:56
  Speaker 1: Yes, their details are in my phone, but then thousands of other people's details are there as well, whereas if I have a card and I sit down after a networking event.
• 8:04
  Speaker 1: Or I've been in and seen an agent and that card sat on their desk.
• 8:07
  Speaker 1: Boom, all of a sudden they're like, oh yeah, I need to follow up with that person.
• 8:11
  Speaker 1: That's great, yeah.
• 8:12
  Speaker 1: Or it's something that maybe they're thrown away, who knows, but at least it's sat around somewhere.
• 8:17
  Speaker 1: Somebody's got more chance of it.
• 8:19
  Speaker 1: So make sure you've got good marketing materials, potentially a brochure or like a postcard sort of brochurey thing, but at least, if nothing else, have a business card, potentially with your own face on as well, so people recognize and remember you.
• 8:31
  Speaker 1: Make sure you look the part.
• 8:34
  Speaker 1: If you're going and meeting people, don't dress like I am in this video.
• 8:38
  Speaker 1: Okay, dress smart.
• 8:40
  Speaker 1: You know, if I'm going out to meet you, I've got a shirt on, I've got a jacket on, I might have jeans and some smart shoes, but look the part.
• 8:47
  Speaker 1: Okay, when you get there, first impressions are everything.
• 8:50
  Speaker 1: Now, some people will say, well, you shouldn't be judged your book by its cover.
• 8:53
  Speaker 1: And you're right, you shouldn't judge your book by its cover.
• 8:56
  Speaker 1: But guess what you do, you're gonna.
• 8:59
  Speaker 1: So my first impression of you, if you walked up to me in a t-shirt like this and a baseball cap, said I'm going to rent your property, I'd be like no chance whatsoever.
• 9:07
  Speaker 1: Now you could be the best service accommodation operator in the world and it could be my old way of thinking, but it's not the first impression I want.
• 9:14
  Speaker 1: Wait.
• 9:15
  Speaker 1: So if you walk up, you look smart.
• 9:16
  Speaker 1: You come up to me, you're looking tidy and everything.
• 9:19
  Speaker 1: And it goes for men, it goes for women.
• 9:21
  Speaker 1: I'm thinking to myself they're on it, they're smart, they're good.
• 9:24
  Speaker 1: Go home and put your comfies and stuff on or work how you wanna work, but make sure first impressions really do matter.
• 9:31
  Speaker 1: Okay, I would never go out to a meeting dressed how I am in this video.
• 9:36
  Speaker 1: Okay, the reason I'm dressed like this here is because this is me casually sharing with you top tips that I've learned through doing these operations, through doing these deals that I just wanna share with you guys as well.
• 9:49
  Speaker 1: Okay, so make sure that you put that effort in.
• 9:52
  Speaker 1: You know, once you've found an opportunity, make sure you know how to stack good deals.
• 9:57
  Speaker 1: When I say stack good deals, have a spreadsheet, have some sort of methodology that you go through to make sure that you know how much profit you should be making at different occupancy levels.
• 10:09
  Speaker 1: So at 50%.
• 10:11
  Speaker 1: Most of the time I say to my students and we have deal analysing spreadsheets as well.
• 10:15
  Speaker 1: You can download a deal analysing spreadsheet at wwwthepropertyunleashedcom with the free resources if you need it, and it'll help you stack deals Realistically.
• 10:27
  Speaker 1: If you're stacking any service to accommodation deals at 50% occupancy, so if the property was only filled for half of the month, you're gonna at least break even in what you're doing.
• 10:38
  Speaker 1: Now.
• 10:38
  Speaker 1: If you're doing management, it's all just about profit.
• 10:42
  Speaker 1: If you're doing rent-to-rent, you wanna be breaking even then.
• 10:44
  Speaker 1: So you wanna know that even if you just fill it up halfway, it covers all of the costs.
• 10:49
  Speaker 1: Okay, 60% is probably the target.
• 10:53
  Speaker 1: You wanna be at least 60% or an above.
• 10:56
  Speaker 1: Trust me, you know 90% is good, 75% is good, 70, 75 is a sweet spot.
• 11:02
  Speaker 1: You should really be able to see what you're gonna be making there and when you get your properties and you will get your properties as long as you're consistent and persistent do make sure that you understand and realize if you're 60% or below occupancy, you may be charging too much, okay.
• 11:17
  Speaker 1: If you're 100% or 90%, shall I say to 100% you may be charging too little, okay.
• 11:25
  Speaker 1: So some people say I'm happy as hell, me.
• 11:26
  Speaker 1: I'm a hundred percent occupancy.
• 11:28
  Speaker 1: Okay, but what are you charging?
• 11:30
  Speaker 1: Are you making the profits?
• 11:31
  Speaker 1: Because it realistically you can charge a good profit at about 75%.
• 11:36
  Speaker 1: It's less wear and tear on the property and in turn it's more of a cost saving for you.
• 11:40
  Speaker 1: Not only do you make good money because you've got your price points right, but you're also not getting all that wear and tear on the properties as well.
• 11:47
  Speaker 1: A lot of amateurs Just think they need to get a 90% 100% occupancy.
• 11:50
  Speaker 1: Sometimes it's good if you get a long booking and of course you have anyway, which is fine and that's a different conversation.
• 11:55
  Speaker 1: But just be mindful of that and look at your revenue management, your dynamic pricing.
• 12:00
  Speaker 1: We'll do an episode on that all on its own for you, because that is a whole new discussion.
• 12:05
  Speaker 1: Too many people get into essay and don't know the true costs of things and what's really involved.
• 12:12
  Speaker 1: Tax, vat, massive, massive will put you out of business if you do not take them seriously, if you do not build that in to whatever it is you're doing from the word go.
• 12:26
  Speaker 1: That is something with our students we work very, very closely on very, very early is to make sure you know what taxes you're gonna be paying.
• 12:35
  Speaker 1: You know your VAT thresholds on what that means to your business.
• 12:39
  Speaker 1: I see some people joint venturing, getting together, starting an essay business.
• 12:44
  Speaker 1: They get three or four properties.
• 12:45
  Speaker 1: They start paying themselves a full-time wage, each from all the profits.
• 12:50
  Speaker 1: But they're loving life and they're doing, and they live in the dream Until it comes to their tax returns and all of a sudden HMRC is saying your corporation tax is this, your VAT which you should have been registered for is this and you owe us this in Backdated VAT.
• 13:07
  Speaker 1: And all of a sudden they're out of business.
• 13:10
  Speaker 1: Not only that, but they could have HMRC Chasing them down.
• 13:13
  Speaker 1: Okay, that could potentially be big fines.
• 13:17
  Speaker 1: It could be, worst-case scenario, prison.
• 13:19
  Speaker 1: It's scary stuff.
• 13:20
  Speaker 1: You've got to know about these things because service accommodation are treated as individual Businesses, so when you have a property, it's looked at as his own entity, so it's the profit that's going into that business as well.
• 13:34
  Speaker 1: So make sure you truly, truly understand that and again, that could be a whole nother episode that we put out there.
• 13:40
  Speaker 1: I put out there for you.
• 13:41
  Speaker 1: So make sure that you know all of your costs.
• 13:44
  Speaker 1: Okay, tax is a massive one, but also you're linen charges, you're cleaning charges, your rents, anything else like that that's going to be happening, your utilities and stuff like that and make sure that you can stack those deals.
• 13:56
  Speaker 1: We only want to be doing good deals in our property investing business, so make sure that you are there.
• 14:03
  Speaker 1: And, of course, if you need help with that, then please feel free to reach out to myself or a member of the team and we will help you every step of the way or as much as we possibly can.
• 14:13
  Speaker 1: So I hope you've enjoyed this episode.
• 14:15
  Speaker 1: We like to put these videos out there to help and support you on your property journey.
• 14:19
  Speaker 1: We do have the rent-to-rent business builder, which is a complete homestead training with my coaching, to help you create a successful rent-to-rent business.
• 14:28
  Speaker 1: And we have the ultimate essay, the ultimate service accommodation business builder as well, which does just that helps you from going from complete novice to six-figure service to accommodation business owner.
• 14:39
  Speaker 1: With my help, with the help of the coaches there as well, we will help and support you and push you to get those deals.
• 14:45
  Speaker 1: And, of course, do check out my channel, check out my successful students for a bit of inspiration.
• 14:50
  Speaker 1: They'll tell you how they've been getting on, whether they've been doing HMOs, whether they've been doing service to accommodation, the sorts of deals that they've been doing and how quickly actually they've managed to build up those businesses in an environment and a helpful community that we offer here.
• 15:03
  Speaker 1: Check out the property unleashed com for free tools and resources and for more information and, of course, follow me, reach out to me on social media.
• 15:10
  Speaker 1: I'm more than happy to help and answer any questions that you put out there.
• 15:14
  Speaker 1: So all that leaves me to say is get stuck in, get yourselves out there, make sure you're the property professional in your industry and come and join me in the next episode very soon.
• 15:24
  Speaker 1: Bye for now.