UK Property Investment Blog

Tip 1

I have been busy reading a great book called ‘swim with the sharks’ by Harvey Mackay this
month and I noticed we both share a very useful negotiating technique when putting
together deals? This is the walk away tactic.

The walk away tactic is the ability to pretend to walk away from a deal even when you are
desperate to close!

Its human nature to want something we cannot get (the grass is always greener on the other side etc) so pretty much every seller will value you more as a buyer if you are able to give the  impression that the deal doesn’t mean that much to you.

So be prepared to say to any motivated seller.

I’m sorry I am not able to help you Mr Smith. I strongly recommend going with an estate agent if you need to get that much out of this property.

It may take a few months but at least you’ll have a chance of getting that sort of price from a owner occupier?

Call Mr. Smith after a couple of weeks to check how he’s getting on if he hasn’t already called you back. You never know, he may well have changed his mind!

Tip 2

In all your marketing efforts (leaflets, ads, postcards, letters, websites etc) make sure you include the following essential ingredients to maximise response:

1. Always try to include testimonials from sellers that you have worked with in the past.

2. Include a recent photo of yourself if possible.

3. Use an 0800 number for potentially motivated sellers to call you.

4. Give a reason why you are able to buy their house so quickly.

Tip 3

I have been literally inundated with emails from investors lately, with details of supposedly
‘magical’ deals? You know the ones Mikee, they’re the deals that look far too good to be true!

Lets take a few example scenarios, and work through them individually:

1. Chap in Liverpool is selling 40 houses, all tenanted, producing a gross yield of 11%

First things first. If its such a great portfolio, why is it being sold? Usual answer: “he needs the

money” ? so why doesn’t he just refinance? These deals have far more to them than meets the
eye Mikee! You will need to individually research every single property, its location, and the quality of the tenant/s.

Keep in mind that you will need to find one specialist lender, or a number of lenders to

structure the financing for deals like this.

2. Off plan apartments being sold at 15% discount.

Once again, if they’re so good, why are they being sold to you? Why doesn’t the person selling them to you just keep them for himself?

Yes I realise the developer wants to offload them quickly, but my friends are property developers and I never see them discounting properties that they can easily sell through the normal channels at near enough market price.

The golden rules that I use for assessing any deal brought to me are the rules of ‘fingers’ and
‘customisation’.

How many fingers has the deal passed through before it came to you (think about a property
sitting in an estate agents window).

How customized is the deal to your requirements? If the deal has been brought to you as a general deal, one that hasn’t really been filtered to your exact requirements (which you should have set out clearly in your business plan) then why are you looking at it?

In my case, I get great deals offered to me all the time because I’m very well known and I advertise very heavily for motivated sellers.

Improve your communication and your ability to successfully close deals with the Property Mentor *free* course. Book your spot today and don’t get left out!

Up sizing to a larger property is becoming increasingly harder for families in the current financial climate.

In a report released by the NAEA they found that despite smaller two bedroom properties experiencing a 1.6% increase in price to £124,727, larger properties faced an entirely different story.

During January and February 2009, 3 bedroom semi-detached houses fell in value by 4%, with 4 bedroom detached houses witnessing a similar fall from £339,072 to £316,228.

Yet despite these evident changes in property values, home buyers are still having to downsize their properties due to the increasing number of restrictions that are being placed on lending.

Beginning with the FSA’s proposal. Speaking earlier this week they called for the abolishment of 100% mortgages and for loans to be reduced to 3 times an individual’s salary.

With such restrictions in place, homeowners are left with no choice but to invest in smaller properties as they are unable to raise the capital they need to offer lenders a larger deposit.

Probate properties can soon convert to the driving force of the property market, concording to recent studies.

Reputed for bearing lower cost tags than other properties on the housing market, these hidden property jewels could provide the perfect investment answer for investors seeking continual sources of investment.

HomeTrack’s property analysts explained that while property sales may be cut down by 50-60%, the number of probate properties appearing on the market is still consistent. And part of this reason is due to life expectancy.

Although it may sound morbid, people are still dying at the same rate as they did before. It has not risen or fallen like house prices, but has remained the same.

For this reason, probate properties have become a core part of the economy. Bringing with them 500,000 new properties every year, which families traditionally try to sell fast in order to enable them to sort out their family’s inheritance tax.

Yet the important feature about these types of property has to be their ability to remain flexible and accessible in all financial climates.

Having earned themselves the reputation for being run down, tired and in need of repair. The main reason why probate properties are so cheap is due to their need for renovation. They need more work than the average household.

Now whilst as an investor your sole goal will be to rent out accommodation and not sell it, the easy accessibility of these properties means you can make increased instant profits on top of only investing for 80% of the properties real value.