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  • Property-a-holics

    Report from the Property Investor News meeting in London - 6th April 2009

    Dear All,
    I attended the above event last night along with about 60 other investors and thought I would report back for those of you who were unable to attend.
    First of all, I wanted to say how refreshing it was to attend a meeting without any marketing and sales hype, and hear a realistic outlook about the the future of U.K. residential property and, in particular, "creative financing".
    Richard Bowser, the editor of the magazine and a real property veteran, introduced the meeting. He spoke about how property has been dominated by BMV/NMD for the past few years, and how those days are well and truly over. He warned everyone against many of these "schemes", "creative financing" options, and "clubs" who promise you can purchase property with no money. It was very refreshing to hear someone voice from the front of the room at a meeting what myself and Nick have been saying for the past year. I commend Richard for having the courage to do this as he runs a commercial enterprise and many of the companies who advertise in his magazine are from the NMD circle!
    Richard's view was that property was now once again the domain of the professional investor with significant liquidity, who operates their portfolio as a business focussed on cash-flow. He was of the opinion that there would be many more Landlord repossessions and bankruptcies in the coming months. He told the story of a particular NMD investor who had purchased 110 properties and ripped all the equity out of them. This guy had lived the millionaire lifestyle buying huge homes and flashy cars. He went from being worth £5 million (on paper) to owing £5million literally overnight and is now bankrupt. I am sure we will be hearing many more of these stories in the future. Richard said that far too much emphasis is place on the acquisition of a property for NMD, without any thought given to what happens with that property over the next 20 years. The focus should be on the marketing and management of the property, because if you cannot find a tenant to rent it, then you have a liability, not an asset.
    Richard then went on to talk about the economy, and to my mind, he told it how it is. He said there would be nil capital growth for the forseeable future, and that we also have the possibility of interest rates rising once inflation starts to rise. He forecast interest rates rising to 8%. He said that we all need to plan our strategies accordingly, with a mind to what is coming in the future. Good advice.
    Professional investor Mark Tolley then came on to speak about his personal strategies in property. These include refurbs, lease options, and matching buyers with sellers to achieve a small commission. Mark discussed several strategies whereby he was thinking laterally and being pro-active, which is something we must all do in the current challenging market conditions.
    Mark was also very vocal against using NMD schemes and said that they will be sorely tested when people do their tax returns later this year.
    There was then a panel session with John Corey (REI on Property Tribes), Nick Dare, Richard Shepherd, and Mark Tolley.
    Subjects discussed included buying at auction (not for the inexperienced), NMD schemes, stacking deals, and lease options. Many people felt that lease options were the way forward in the current challenging market conditions, and this is something that myself and Nick are looking into in greater detail.
    Afterwards there was some general networking, where I met some very experienced investors and was interested to hear about their personal strategies. It was interesting to speak to some other investors who have holiday lets, and they were delighted with how their bookings were shaping up. Our holiday let "SeaBreeze" at Camber Sands is almost fully booked for the peak season. We'll be achieving some really great cash-flow off this as the mortgage was a tracker and is now £110.00 per month and we can achieve £650.00 per week in peak season. Do the maths!
    I sincerely hope that this meeting was part of a greater movement for ethical and transparent information in property - the reason why myself and Nick formed 4 Walls three years ago. I am so jaded by sales and marketing hype, and being "sold to" at alleged "networking" meetings by people still using strategies and financing techniques that are completely out of date with REALITY. It's now time to get serious in property and respect that it is, and always has been, a long term investment that takes effort and commitment on your part to manage.
    If you attended the meeting, please could you add your review to this thread to let us know what you personally got out of "showing up".
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    I was there. I was one of the panel members for the networking sessions.
    Richard has always offered good insight into the market trends in the UK. He is much better than most at reading the tea leaves and spotting things that could have an impact to ones investment business.
    The event was the first in about 4 years. PIN had been spending time attending the major investor events with a booth and seminars. Given the change in the economic climate Richard said PIN has decided to switch back to hosting their own events. I am guessing this means two things. Some of larger events are off the calendar until the market recovers. Second, having your own event lets you focus on the community you best serve vs being part of a sea of options when you at exhibit at the Excel Centre and GMEX.
    I was impressed with Mark's presentation. He really pealed back some of the details on why many NMD schemes are really a wolf in sheep's clothing. Mortgage fraud is one accurate label for some of the schemes others are promoting. There is also a problem with the tax impact given the deal structure used by some promoters. From talking with individual investors there is a lot of costs involved so the promoters are suck out much of the paper profits in transaction fees.
    I was told PIN will be organizing another workshop in May. If anyone missed yesterday's event another opportunity is around the corner.
    John Corey
    https://www.ChelseaPrivateEquity.com/blog
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    John Corey 


    I host the London Real Estate Meet on the 2nd Tuesday of every month since 2005. If you have never been before, email me for the 'new visitor' link.

    PropertyFortress.com/Events

    Also happy to chat on the phone. Pay It Forward; my way of giving back through sharing. Click on the link: PropertyFortress.com/Ask-John to book a time. I will call you at the time you selected. Nothing to buy. Just be prepared with your questions so we can use the 20 minutes wisely.

    Glad to see such nice and positive comments towards the event that we put on as a lot of time and thought went into it, particularly as those of you who know or read Property Investor News will be aware we don't deal in hype or spin and will always give you the cons as well as the pros of any given investment strategy.
    Well hopefully we will be seeing Nick and Vanessa, along with John (who is already confirmed as coming) at the next workshop and networking event on Tuesday May 12th in London.
    https://www.property-investor-news.com/networking.htm
    Creative Strategies, Lease & Sandwich Options & Rent to Buy is the topic this time and an ideal follow on for those that previously attended, or as a standalone topic for those who weren't fortunate enough to attend the first event.
    Vanessa, I agree with you, too much spin and hype has left too many people either disillusioned with the market or a victim of their own greed and naievity.
    As Richard, the editor of PIN has always said, Property will make you rich if you invest properly and dilligently. If you want get rich quick, look elsewhere. If you want get rich slow and be in it for the long term, you will make money.
    Kind Regards,
    Will
    will@property-investor-news.com
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    Will and others,
    I have created two events under the event section of PropertyTribes. One for the Lease Options Workshop and one for the networking later that same evening. I have directed people to the PIN site so that they can register given the cap on the number of seats available on the day.
    I am looking forward to presenting and otherwise helping to explain lease options to those attending.
    John Corey
    https://www.ChelseaPrivateEquity.com/blog
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    John Corey 


    I host the London Real Estate Meet on the 2nd Tuesday of every month since 2005. If you have never been before, email me for the 'new visitor' link.

    PropertyFortress.com/Events

    Also happy to chat on the phone. Pay It Forward; my way of giving back through sharing. Click on the link: PropertyFortress.com/Ask-John to book a time. I will call you at the time you selected. Nothing to buy. Just be prepared with your questions so we can use the 20 minutes wisely.