Over my eight years of being a professional residential Landlady, I’ve certainly learned a few things the hard way and I’ve also made mistakes. I love to share information with others, as I concur with the saying:
“It costs nothing to light someone else’s candle with your flame of knowledge“.
If I can help another Landlord avoid some of the mistakes I’ve made, then that is a worthwhile exercise in my book.
Yesterday, someone asked me this question: “If you could only give a new Landlord ONE piece of advice, what would it be?”.
Well that certainly focussed my mind!
After much thought, I came up with this:
“Find the demand, before you create the supply“. (Most people tend to create the supply and then hope there is a demand and that simply doesn’t cut it).
I am assuming that you are getting into property to achieve financial freedom? On that basis, you are looking for a ROI = return on investment. Therefore, there is no point whatsoever in buying a property, no matter how appealing the deal, if no one wants to rent it! You are looking for assets, not liabilities. You are looking for a tenant to cover the mortgage with a healthy net cashflow, not fund the mortgage yourself because the property is void.
Therefore, your main focus when looking for properties is to focus on rental demand in the area and perform extensive due diligence.
The Yulpa iPhone app actually does this all for you! Simply put the postcode of the property into the app, and Yulpa will collate all the due diligence information including rental comparables, sales comparables, crime information, transport information … the list goes on. The app also acts as an educational tool, as it prompts you to gather other relevant data with links to the sites where you can find that information. I put this due diligence process together, and it ran to eight pages of data you need to research, leaving no stone unturned. I hope you can appreciate how this could minimise your risk of buying a poor property?
Well, being me, I couldn’t just stop at one tip, so here are a few more, which are all worthy of their own blog in the future:
2. Focus on positive net cash flow, not capital growth. Property investment is a business, and cash flow is it’s lifeblood, just like any other business.
Related video: Numbers never lie
3. Buy houses instead of flats. Find out ten reasons why >>> here.
4. Never take anyone’s word for anything. Always do your own research and due diligence. After all, it’s your money, and the best person to decide how to spend it is the person you see in the mirror every morning … not a third party with a sales agenda!
5. Property is a “people” business. You are providing a service to your tenants and that requires obligations, responsibilities, and compliance to remain within the law. Adopt a business like approach, and behave like a professional at all times to ensure your success.
For further insights, join the Property Tribes forum, the U.K.’s busiest and friendliest Landlord and investor community … and it’s free to join.
I look forward to engaging with you somewhere down the property trail …
Happy Landlording!
Vanessa Warwick
Follow me on Twitter: @4_walls
Vanessa Warwick is a former TV presenter, turned professional residential Landlord, consultant, and speaker. Along with her husband Nick Tadd, she founded Property Tribes, which is now the U.K.’s busiest on-line Landlord and investor community. Nick and Vanessa have just launched their new tech product, Yulpa, an on-line “property office/filo-fax” that helps you organise and manage your entire property life in one place. It comes with an iPhone app that does auto due diligence on any property being considered for purchase.
Vanessa and Nick advocate the use of technology and digital and social communications in property, and speak at events all over the U.K. as well as consulting for the BBC on property. They invest mainly in flats London and family houses in the South East and are also big advocates of holiday lets, having two upmarket holiday lets on the South Coast that achieve above-average occupancy thanks to the couple’s web efforts and vertical marketing strategies.
