How could I make more money from a property than a professional letting agent or experienced landlord?
Hello, hello, hello and welcome aboard episode 42 of the Rent to Rent Success Podcast.
You'll love this episode because it’s answering a question that really stops people from getting started.
If a letting agent can’t make a property work, how can I?!
If you’re just joining us, do go back to episode 1 as the episodes build on each other to give you the full view of rent to rent success.
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Let’s get stuck in!
Perhaps you can see that a landlord or letting agent might entrust you with a property.
How could you make it worth more money so that you can pay a fair rent to the landlord and charge a fair rent to tenants?
In episode 2 of this podcast, we talked about the three ways to do rent to rent and you’ll remember I talked about HMO, serviced accommodation and single let.
HMO is the one with the highest return on money and time invested, especially for beginners.
And it’s easy to see how you can make more money when the property is being rented as a single let and you rent it out by the room.
Yet I suggested that you choose existing HMOs.
That means the properties are already being let out by the room which prompts you to wonder how you achieve higher rents than the landlords or letting agent previously did.
When a property is already an HMO you’d assume the owner or letting agent is already used to higher rents, and this isn’t always the case.
The way we are able to achieve higher rents is by our HMO systems which many landlords and agents are unaware of, or do not implement. We complete a light refurbishment to the property (sometimes we pay, sometimes the owner pays).
We dress the rooms attractively and we provide good service.
And it’s the last one which provides the most uplift.
Let me give you an example to bring this to life.
We took on an 8-bed HMO and the owner was losing £800-£1000+ every month after he’d paid his mortgage and all the bills - the rents didn’t cover it.
His property only had 3 tenants all paying low rents.
The heating was set to Tropical 247.
A wall of heat hit you as you opened the front door.
Stale sweaty air.
The air was almost thick and it was so hot.
You’re perhaps wondering how anyone would find themselves in this position.
He was paying for people to live in his property.
It’s not how property investment is supposed to work!
This landlord is a lovely man with a young family and other businesses and lives over an hour away.
He initially self-managed and then passed on to a letting agent.
Over time the property went downhill to such an extent that he was losing more and more money.
Eventually he stopped using the letting agent as they just weren’t helping and it was another cost.
Of course, he’d have sold if he felt he could have.
But having bought at the height of the market, selling would have left him owing tens and tens of thousands of pounds to the bank.
So he hung on losing over £800-£1000 every month.
And then, he got our letter about rent to rent and guaranteed rent.
After his experiences with letting agents before he was sceptical but he was keen to give it a try.
And this same exact property which was losing him £800-£1000+ every month, we turned into a property which now makes over £1,000 per month for the owner.
And makes over £1,000 per month for us.
It irks me when people say we’re taking away.
We’re adding value.
And it’s a win for everyone involved.
Now not every case is as extreme as this.
But in almost every case having an HMO system like the Rent 2 Rent Success System that we teach in our Rent 2 Rent Kickstarter Programme will enable you to take any HMO property that meets the criteria we set out and make it more valuable.
When you make it more valuable
- It’s better for housemates
- It’s better for landlords
- It’s better for you
You can do this too.
If you want to find out more about getting started in rent to rent sign up for our Free Rent 2 Rent Success Guide and Masterclass.
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Until next time, have a great rest of the week.
And remember,
Believe Bigger, Be Bolder and Be a Gamechanger!
See you soon!
Stephanie & Nicky
xx
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