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  • Refurbish/Develop

    £150K ready to invest - advice needed please

    Hello All,

    I’ve just come across this forum and this is my first post. I’m hoping some of you will share your thoughts with me and help me decide on the best course of action.

    I have £150,000 sat in the bank currently doing nothing and I am keen to invest in property. I am particularly interested in flips and have been doing a lot of research in terms of where best to invest etc. I’m not a complete novice,I have purchased/sold 5 properties in Wokingham/Reading in recent years and have done fairly well. Most required minimal work such as redecorating etc all of which I did.

    I have spent the last few weeks trying to soak up as much knowledge as possible. I met a chap called Samuel Leeds last week who told me to invest in HMO’s. He offered to help, but his help came at a price - £12,000.

    I have booked onto some property seminars this month in hope I’ll broaden my knowledge and meet some like minded people.

    I have viewed several properties in recent days all of which required a fair bit of work which hasn’t phased me, however most only seem to be priced about 15% BMV. I keep hearing reference to the 20% rule, but I have no idea how investors source these - I imagine through good relationships with agents and/or paying sourcing fees.

    My ambition is to make a living through property, but I’m hearing so many conflicting things in terms of where I should invest and what approach I should take.

    I am hoping some of you who are far more experienced and knowledgeable than I would share your thoughts on what approach you would take if you were me.

    Incidentally I have recently taken 12 months off work (career break) to invest in myself and support a sick Mum. I have very little in the way of out goings and don’t have a mortgage.

    Your thoughts would be really appreciated.

    Em

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    Hi emmakinghorn

    I own a small property management and maintenance company. When I look for properties for myself or investors I aim for a minimum 12% return on rented property some achieve 20%.

    as to flipping property this can be tricky up here in the north east, future values are harder to predict

    the £12,000 you were quoted is difficult to put into context if after the work the property would earn you a good yield then it’s worth it

    Gary


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    Hello Gary,

    Thank you for coming back to me and for your advice.

    Emma

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    Ignore any HMO mentor save your money.

    Don't bother with HMO things are changing for HMO along with other threats like Individual  Council Tax Banding.

    That is why many LL are selling up HMO.

    Stick with your basic lettings

    Go for maybe a 4 bed property maximum as you won't be under new mandatory HMO regulations for 4 occupiers.

    Ignore any additional  licensing like in Southwark as the council will never find out you have 3 occupiers.

    Even if they do you just say 2 of them are partners.

    Council can't disprove either way.

    Same with 4 occupiers

    Stupid councils with their stupid additional  licensing will be ignored by LL

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    Hello Paul,

    Thank you for coming back to me.

    Going for a HMO sounds like a better option than a flip. I live in quite an expensive part of the country (Wokingham) so I will have no option but to look further a field. I guess then I should find a company to manage the HMO on my behalf. My only reservation is I didn't want my money tied up for a long period of time hence why a flip was attractive to me.

    I certainly have a lot to get my head around. I am going to try and shadow an already established investor in the coming weeks to see if I can learn a little faster!

    Thanks again,

    Emma

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    (*Moderator note: Comment removed as pied piper post*).

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    Thanks very much Mo - I will drop you a line now. 

    Emma

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    'I keep hearing reference to the 20% rule, but I have no idea how investors source these - I imagine through good relationships with agents and/or paying sourcing fees.'

    1) GOOD RELATIONSHIPS - THATS A EUPHANISM FOR A BRIBE WHICH IS ILLEGAL.  AN AGENTS JOB IS TO GET BEST PRICE FOR THE VENDOR SO WHY THEY SHOULD NOT BE DOING ANYTHING ELSE!

    2) SOURCING FEES - A CON.  ANY FOOL WHO PAYS THEM IS ASKING TO LOSE THEIR MONEY.

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    Hello,

    Thank you for your advice.

    I met an agent yesterday who told me all about a flat he was taking on next week. He said it was a probate sale and it would go for 137,500 which is some way below the 170,000 it's worth. He said it would go online, but not to bother requesting a viewing as he 'had promised a mate' the property as he owed him. Makes me wonder how much this goes on! 

    I won't be paying anybody sourcing/finders fee - I will sign up to a few websites and will do my own research.

    Emma

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    good idea.  imo there will be lots of repos soon and then the boot will be on the other foot.

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    Look around where you live

    look at areas you know well

    look on rightmove Zoopla ect in the areas

    Become an exspert in one area

    Understand the prices understand the trends

    Once you have mastered that buy BMV

    You will know what you like and what you don't like

    Then build a team of tradesmen around you who you trust unless your doing the work yourself

    You will only really learn when you do it

    You will get things wrong you will get things right

    don't pay for education

    You will live in a house now so you understand about a house

    Learn about trends and what is wanted from  purchaser when you going to sell

    This is not hard to learn

    Just know your own area and do it ???


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    Learn Change and Adapt ?????

    All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.