Everywhere you look, the next property education provider is trying to sell you the property dream, by teaching you the property strategies you will need to make it big in the property game.
They break down each property strategy into individual courses, trying to help everyone, and by doing so, have created confusion and muddied the waters. In my opinion, they have lost sight of their core products and their mission, blindsiding themselves of what is needed to coach successfully those wanting to become property investors.
In my personal opinion, the property education market has gotten wholly distorted from the truth. The sheer volume of new property strategies has now become an epidemic that is spreading through the property market.
By writing this article, I hope to restore some much-needed clarity for people wanting to get started as property investors.
Fundamentally, the biggest problem with the above is that these property companies have become property generalists. Frankly speaking, how can you be an expert at multiple strategies, it goes back to the analogy of the general practitioner vs the brain surgeon. I believe real value is created through specialising in a specific property strategy route, that once followed can give people actual results.
Many strategies can work, but what it comes down to is the circumstances of each individual. Everyone’s circumstances are entirely unique, and I cannot help but feel that it has been forgotten by the majority of property education and with it the value they need to provide.
My mission is to restore value, by changing the way we educate people in property investment. Value is achieved when you have a proven system that a specific type of individual can follow and get real-life results.
I believe in offering lifetime access to an in-depth knowledge base for a fraction of its real value. I want people spending their hard-earned cash on buying property investments. As a result of this want, I have entirely re-invented the property education model.
So firstly, let’s understand the different types of property investments and the property strategies available.
Buying a property and renting it out for a profit, often to a single occupant, family or couple. The aim is to generate an income mid to long term.
HMO (Houses In Multiple Occupation)
Purchasing a property to convert into an HMO. An HMO is where you rent out individual bedrooms within the property to multiple unrelated occupants. The aim is to purchase a property that you can easily convert (ideally under permitted development, which requires no planning permission) into lots of bedrooms with shared communal facilities, to maximise the cash flow of a single dwelling. (Closely linked to change of use below).
Change of Use
Changing the registered use class of a property, by renovating and adding value. Upon completion of works, the aim is to re-finance the property and extract the maximum available capital. The extracted capital can then be used to finance the next property purchase.
Property Trading (Buy to Sell)
Purchasing a property and adding value through refurbishment, with the intention to be sold on at a higher price.
A strategy that requires very little to no capital to get started. A laptop, some contacts and phone are all you need. Secure property deals for a reasonable price that have a solid return on investment. The aim is to package these deals up and sell them onto a third-party investor for a profit.
A single dwelling converted into multiple units. This is a solid strategy that has more than one exit. There’s the option to sell some to pay back the borrowed capital and keep some to generate a passive income stream.
Rent to Rent
An individual or company takes a legal interest in a property for a fixed period from the current owner (landlord) and guarantees to pay a fixed rent each month to the owner. The owner then gives the “renter” who is the third party the consent to rent (sub-let) the property to other tenants. The aim is to make a profit between a monthly cash flow to generate an income.
Build to Rent
Building new developments with the intention to rent them out upon completion of works. As opposed to selling the units, the primary goal is to re-finance the development to pay back the development finance and rent the dwellings out to generate an income.
A lease option is otherwise known as a lease option to purchase, is a legal contract between a property owner and the tenant. Often in this scenario, the investor becomes the central tenant under the lease, with an option to buy the property for a fixed fee at the end of the contract term. During this term, the tenant (investor) is allowed to make changes and improvements to the property, and then sub-let to a third party to generate an income.
Converting a hotel into residential dwellings or serviced apartments. Multiple exit strategies available, where you can either sell some to pay back capital invested, and rent some out for income, or sell all of the units for a profit. The other option is to re-finance the units to pay back capital and keep them all for rental income.
Commercial to Residential
Converting a commercial property into multiple residential dwellings. Option to sell all of the units for a profit; Or, sell some to payback total capital invested and keep the remaining units, for little to no money left in the deal, and generate an income mid to long term.
Self-contained units that are fully furnished and fully managed. These types of properties are available for short term rental to business travellers or tourists. Exit strategies available are to sell, let or re-finance.
Planning gains are where the value of the property (often a building or land) increases due to planning permission being granted on the development proposal. The developer has the option to sell the land or property, with planning permission in place for a profit or build out the scheme.
Purchasing a piece of land with the intention to build on and develop. Option to sell the units upon completion for a profit, or re-finance and rent them.
Purpose Built Retirement Blocks
A development with the sole aim of being sold or let to the over 55 markets. Often, there are communal facilities on site for convenience and sometimes even carers.
A development comprising of different asset classes. The property or development site usually integrates a mixture of commercial shops, residential apartments and possible entertainment facilities. Option to sell a part to pay back capital and keep some for rental income.
Converting an industrial unit into multiple residential dwellings. Various exit strategies are available to the investor or developer. They have the option to sell for a profit or sell some units to pay back the total capital invested and hold the others for rental income to generate a mid to long term income.
Commercial FRI Leases
A commercial property purchased by the investor with a view to renting out the building to a business to generate a mid to long term income, and benefit from future capital growth through forced appreciation, by increasing the rental yield.
To conclude, there are over 20 different types of property investment strategies, for the everyday person wanting to get started; this is a barrage of information and completely overwhelming.
Teaching individual strategies alone leads people to fall victim to what I call the procedure trap. Property investing is a business, and if you learn just a specific property investment strategy alone, you will end up in complete chaos. You must understand the core components and operations of running a property business, before learning the individual procedures. In my opinion, just learning a strategy or strategies is like trying to build a castle on sand.
The key is to subtract when everyone else is adding…
Focus on your individual circumstances and what you are trying to achieve, and with strict discipline, channel your focus until you become the master of your destiny. If you follow this one piece of advice, there is every chance you will become a very successful property investor.
I have built my entire online platform around focus so you can escape the procedure trap, by focusing on your individual goals. Plus, I have the complete road map from a to z, already prepared for you.
It’s the exact road map that I used to subtract, adopt monk-like discipline and become the property investors brain surgeon. The result is 15 properties in 18 months. I own them all, that’s right, I don’t control property I own it because that is where long term sustainable wealth is created.
How To Start & Grow A “Hyper-Profitable” Property Business
On this online masterclass, Richard shares with you exactly how he went from feeling unfulfilled in his corporate job where he was stuck trading his time for money to building a multi-million property portfolio and replacing his original salary whilst freeing up time to live life on his terms.