Oh my, was it really November since I last posted on here? Where does the time go?
Well 2014 can go swivel, for a whole host of reasons, not least of which having to watch my father slowly die. This is my Facebook post from the time, and I don’t think I’m going to say more than that:
Waking up and being disappointed to discover my father is still alive has to rank up there with one of the worst experiences of my life.
As my father-in-law (who also suffered horribly before his eventual death) said, before he lost the faculty of coherent thought and speech: “We wouldn’t let a dog live on like this, why do we force humans too?”
What I think right now about religion’s backing for the State’s moratorium on euthanasia, and the needless suffering that causes thousands of people on a daily basis, is probably unprintable.
Moving swiftly on to 2015, it’s all change. As you may have noticed from the change in title to this blog, I’ve refocused my life on our property portfolio. It’s modest at the moment but that’s changing A LOT in the coming year, as I’m focusing all my time and effort on increasing it.
It’s my intention to post a monthly update here, partly as a personal record for myself, but also to keep any interested parties informed (let me know if you want to get the monthly updates by email), so here’s what happening in January:
As some of you know, I’m working with Susannah Cole, who from a standing start has bought (for herself and with her investors) over 150 properties in Bristol in the last few years. She’s an expert at buying property at a discount, refurbishing them, and selling them on for a healthy profit (this is called “flipping” property); we will be working together to do the same in Cheshire this year.
I’m also working with Trish McGirr, a hugely successful northern property investor who’s acquired (through normal purchases and otherwise) some 300 properties. Already with her help, I’m actively pursuing 3 flats and a house.
As you can see, I very much believe in standing on the shoulders of giants, and when there’s tens of thousands of pounds to be made, why wouldn’t you get the best experts in your camp?
My main activities for January have been:
1) Refinance my existing portfolio – I have 3 remortgage applications underway at the moment, which should release (pending valuations) between £120,000 and £160,000 of further equity to use in the business
2) Purchase another single let – I have agreed a purchase of a 2 bed end of terrace in Warrington for £85k. After a £10k refurb to split the 2nd bedroom to make a 3rd bedroom, it will be worth £115k so has £20k equity from the start.
However this property it comes with a tenant in situ, generating a gross yield of 8.1%, so I will be keeping this property and adding it to my portfolio. It’s an example of the sort of properties I will be buying and flipping, and if I had flipped this, it would have returned around a 15-20% profit margin on total cost.
3) Raising Private Finance – I’ve been busy talking to old friends and colleagues throughout January, not only for great chats and the chance to catch up, but also with a view to raising additional finance. I’m putting my own money up (about £1/4M) but my 18 months cash flow forecast already predicts that’s not going to being enough.
Towards this end I’m launching 2 partnership programmes, and will be looking this year for a few select people to become Silver Brick Partners and Gold Brick Partners to share in my property business.
Silver Brick Partners with be eligible for generous rates of return for simple fixed period loans. Because of the profit margins involved (as evidenced above), I am able to offer much better rates of return than the banks are offering. I’m looking to take only 6 loan partners this year, and already in January have 1 partner ready to go, with another having expressed initial interest.
Gold Brick Partners are those people who wish to more fully share the risks and rewards of property investing. Typically having a six figure sum to invest, these investors will be true joint venture partners, who will fund the purchase and refurb of properties whilst I do all the hard work! Profit will then be split on a 50:50 basis. Subject to successful 13.3 vetting, I’m looking to take only 3 JV partners this year, and I’m currently in advance talks with a potential investor.
It goes without saying, that if you know anyone who either is fed up with getting a terrible rate of interest on their savings or has always wanted to invest in property but didn’t know quite how to start, then please ask them to get in touch with me, or pass on their details to me.
As you can see, it’s been a busy but exciting month, with much more still to come. It’s going to be a great year!