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  • Property-a-holics

    Dislexic Landlord's greatest hits and tips



    Welcome to the final week of our "Smart Landlord" 2019 campaign, showcasing intel to help landlords work smarter and more efficiently.

    One of the traits of a Smart landlord is that they leverage the knowledge, contacts, and experience of those who have gone before them.  They make others' hindsight their foresight, thereby helping them avoid the many pitfalls of landlord life.

    Here are Property Tribes we are fortunate to have the contributions of a highly experienced portfolio landlord, Dislexic Landlord (DL).

    DL is based in Newcastle and joined Property Tribes in December 2010, one year after PT launched.  She has become one of our most popular contributors.  She only actually started commenting around 3 years ago, and, since then, has started over 500 threads and made over 2,000 replies supporting other landlords.

    DL is what we would call a "fire starter" - someone who asks highly pertinent questions, provides information and insights, and creates content that ignites discussion on the forum.

    As part of "Smart Landlord" and our 10th anniversary festivities, we therefore wanted to celebrate the contributions of DL here at Property Tribes.

    But first, I asked DL about her own property journey:

    DL:

    "I started investing in property in 1982. A friend of mine was homeless and I purchased a £7500 property in the NE of England. 

    I was working full time for myself at the time and I thought it would be a prudent Investment.

    Over the next few year I purchased a few more properties.  This of course was before BTL and it was hard for a Landlord to obtain any Mortgages and there was rent control so it was far from easy.

    Around 2000 A friend of mine recommended that I read a book called "Rich Dad Poor Dad" and that one book changed my life.

    I owned a large country house with No Mortgage and I knew my Local Bank Manager quite well and I asked him if I could use my home as security to create deposits .  The Bank Manager agreed and I set off buying Property in the streets I grew up in using my local knowledge.  I purchased a lot of property with 15% deposits with few questions asked.

    The business grew and grew and it was like a drug!  The more I got the more I wanted.

    I stopped buying property around 2005 as property was too expensive and I could not make a yield but I was sitting on a good business.

    Then came the crash of 2007 ...

    My business took a huge knock in capital values but interest rates dropped to 2.5% and my cash flow went through the roof.

    I was sitting on negative equity but I had cash to spend on property using a 25% deposit and property at half the price it was in 2007 so I set off with my cash again and I doubled the size of my business from 2007 to 2015.

    Buying when I only had a cash deposit and buying only high yielding property and it worked fine until the Osborne changes of Section 24.

    I think the Osborne changes made me think deep and hard.  I realised at the flick of a Budget how a government policy can just about kill off a BTL business at a stroke!

    To this day I have not purchased another BTL investment.

    But again I was thrown on a bad deal, this time by a short-sighted Tory Govt.

    I looked again at what I could do and I decided that I would set up a Company and start selling into my Company, cherry picking the property with little gains that were highly leveraged and could be moved in to the Company

    I call this the "Landlord Shuffle", which I must say has worked for me although its cost me a few thousand to do per property because my values in the NE are low.

    I have now moved from an "investor" into what I call a "manager" stage - I now wish to hold the property I have but I now spend my time adding value and increasing rents when I have a void.

    In 2019 I can see little reason in investing further cash into property in the UK.

    I would much rather fund my Pension at the age of 60 than take on more work and more risk growing a BTL Business.

    The Govt policy of S24 makes me into a Higher rate tax payer and with the situation on drawing money from a Company, the new tax dividends are high and its even worse if I draw a salary.

    So Govt policy has brought my expansion to a halt. I wont take a risk now to only have 45% net paid into my hand

    But I will keep what I own and manage it and add value and increase yields".

    _______________________________________

    DL sent me this picture of one of her properties as an example of what she does:

    This was a shop conversion.  It is now four two bed units.  The land at the side was used to build a bungalow.

    To celebrate DL's amazing contribution to Property Tribes, we thought we would showcase her top 20 most viewed and commented on discussions from over the years:

    If I said to you make 118% in 5 years .... 

    In the event of a crash - your survival plan?

    Long term landlord: forecast to be profitable

    Government proposing 3 year minimum tenancy

    BTL vs. Shares - has the pendulum swung?

    My conclusion: Pension vs. BTL? BTL wins if?

    Year end Accounts 17/18 and S24

    Three quarters of Landlords will sell - claim

    What makes others think Section 24 will go?

    My BTL has become a Pension Machine

    3 bed terrace £39K with a rent £550 - deal?

    How can I be +ve with a tax rate of 70% ish?

    What is a healthy yield on a BTL business?

    Will you still be a Landlord in 5 years?

    My first property sale to my New Company

    Millions re-think BTL - are you ?

    "Buy to Let is dead" - contrarian views ...

    Why even 7% yield doesn't work on BTL

    Income Tax rate of 70% to 75%

    The nightmare is about to begin 

    A true lesson of BTL from the North East ...

    Thoughts on the old chestnut - capital growth

    Being such an experienced landlord, I asked DL to give some tips for our "Smart Landlord" campaign:

    DL:

    "If I was starting today, I would invest in BTL but I would realise there is a ceiling ie £50K a year before 40% tax kicks in. I would keep it personal and simple but I would not have grand thoughts about creating an empire which was my own goal and I would seek sound taxation advice from someone who fully understands the BTL world.

    Find the biggest deposit you can and keep leverage down. I would not even think of capital growth in the next 10 years Buy on yield only and bear in mind taxation".

    Property Tribes would like to thank DL for her amazing contributions to this community over the years, and for being such a prolific and valued contributor.

    We are pleased to say that we will be interviewing DL in person later in the year for Property Tribes TV, so keep an eye out for that!

    SEE ALSO  -          Reflections on investing in the North East

    UP NEXT -              Amateur landlords ruined by tax penalties

    DON'T MISS -         Estate agent visits and my findings

    NOW WATCH:

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    This forum wouldn't be the same without her.

    DL tells us the real truth, warts and all, about being a landlord unlike the rosy picture painted by the Gurus etc.

    Keep up the great content DL!

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    I have learnt a lot from DL and enjoy reading her posts.  Thank you.

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    Looking forward to the interview.

    DL is a wealth of knowledge and her diligence, experience and transparency a most-welcome quality to behold.

    An inspiration of well-deserved success, and one of which I have no doubts we can all draw from in shared endeavours to replicate said success.

    "Great stuff" DL, with thanks to Vanessa Warwick  and fellow PT members for keeping the heart of this highly valued community beating.

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    What a generous comment ... and very much appreciated.  Thank you!

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    Even though I often have run ins with DL she does without doubt offers tons of good content

    Highly knowledgeable and experienced in a wide range of property aspects and wider financial advice 

    Wears her heart on her sleeve and always provokes lively debate

    Hands on and down to earth and doesn`t sugar coat stuff

    Long may she continue to share her wisdom for the benefit of all

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    Jonathan Clarke. http://www.buytoletmk.com

    Brilliant.

    Some of us with loads of houses have similar stories.

    I too stopped buying around 2004 2005, as prices were too dear.

    And yes in 2008 the Agents were begging me to buy their houses at 48k which were 80 90k 2 months previously.
    I said I don't want 'em, got too many, had enough.
    Please Mick, buy 'em, we got to keep mortgage repossession company happy.
    So I succumbed more to keep the agent happy as I always did buy bargains off 'em, that way they always came to me first.
    I ended up buying 13 or 19 in 2008. Them 48k 50k houses are now worth 100k, but we ain't gone much over 2005 to 2007 prices here in Nottingham today.

    I think the same, gone are the days of good capital growth for a bit. I used to lose on some houses Rent v's Mortgage every month in the years 2003 to 2008, but din't mind cause they was going up some by 10k every year. But them days are gone in Nottingham.

    But on the other side, the people buying today have low interest rates. I've talked me mate into buying 60k flat, mortgage is approx £130pm with a less than 3% interest rate. So today higher prices to buy, but lower mortgage payments than we had years ago.

    https://www.selectivelicensingtruth.co.uk

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    I am flattered with this Blogg

    I know there are Members who do not support my views and I am happy for that to be the case

    BTL has given me more than I ever wanted But I realise that nothing stays the same

    So we have the Learn Change and Adapt but we have to be mindful that the Govt have the power to put us out of the Game of Monopoly

    I see today one of my fellow Bloggers has mentioned the end of the AST

    Although I am negative on BTL investment I am not sure any Govt would end AST but it could be amended

    We don't have a Political Party as a friend and I don't think any Govt will really support us 100%

    We are better than nothing and the Govt will have to work with us at some point

    The UK is changing we just need to look around and witness what's happening with The EU think

    once we do leave we will than see where we are going

    I have no intention in expanding until I see Value for money and a very high yield

    In the North I cant see any deals that would make me invest one new penny into BTL

    I have always said The North will weather the storms ahead better then the SE Bubble I don't say that to be nasty I say it because S24 and Stamp Duty

    Have largest effect there  and with some Landlords sitting on Large Gains and low yields I would not be surprised to see them sell take the cash

    and come back another day

    In the NE my yields are High But I have lost out on Capital Growth

    The true winner is the SE Landlord in the past Twenty Years  And as I say If I was invested in the SE I would have been selling just as S24 starts to bite

    I still believe S24 is a Ghost to a large number of Landlords and it may well Haunt them as time marches on

    I am not saying BTL cant go on But we are living in very different times

    It would be interesting to see the numbers in ten years time what percentage will sell and retire after all I believe BTL is a Silver Hair investment  in general

    The folk who jumped on BTL since 1996  are now 23 years older ???

    I wish all my friends on PT Good Health and Good Wealth

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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.


    DL you comment that there are members who don’t support your views, that will be the position with any forum, but I think you will be surprised by how many people agree with the main part of what you say.  

    Those new to BTL want to believe that BTL will not change and they will be able to see the returns of the last few years, your views help to bring reality to them.

    For me, the value of your posts comes from the subjects you raise and that you are prepared to debate them and are open to other views.

    I wonder what path your journey would have taken had you lived in the SE? I would add that I don’t think you have missed out by being in the north, you have been able to add high yielding properties to your portfolio with small deposits on a regular basis, whilst in the SE purchases have had to be delayed whilst larger deposits have been saved.

    I wish you well with your continued journey as a landlord.

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