Welcome back to the third module in this, “Serviced Accommodation and Short Term Lets” Course. In this module, I’m going to talk about how I acquired 21 properties, in the first seven months of going into my property journey. And, what you can learn from that, and how I pieced it together, through the action that I took, and also the different styles and the creativeness to form the portfolio. Yes, it was quick and it created so much stress and strain, but was it worth it. Looking at where I am now and how different my life is compared to when it was, back then.
So, let’s dive into where it all started. So for me, I actually started with the lease option and, I must have admitted, I probably winged this a bit. Because, I didn’t really know much about lease options, read a bit about it. But, I managed to pull it off, and I managed to get a deal under my belt. The thing was, I couldn’t actually get that property rented out. I initially had a lease option into a tenant in mind, and I would make two, 300 quid a month out of that property and, happy days, one in the portfolio.
The problem was I had about six or seven viewings, and I couldn’t get it rented out. So, what I then did was figure out the Airbnb game. And boy, I’m glad I did. I actually stumbled into a conversation with a friend who was telling me how he was doing it, on a flat on the key side, and the nightly rate he was getting. So, I quickly worked out, I feel like I’m quite good with numbers, I quickly worked out, okay, that time’s that over that, it seems as though there’s quite a bit of scope there for a bit of uplift.
So, I quickly went to Ikea, bought 1500 quids worth of furniture, spent the next 12 hours setting it up, and took photos at the dawn of the new day. As I set it up overnight and the booking just started rolling in. And, that was me hooked.
So, my first property was a lease option purchaser, a LOP as it’s known, into a short term rental. I then, obviously, got hooked on this whole idea, and I started to look at the numbers. I then put properties two and three were actually B-R-R-R purchasers, using investor money.
A lot of people say I can’t afford to do stuff. Or a lot of people say I don’t have the money. My mindset was, how can I afford to do it? How can I find the money? So, what I did here was, I worked out what the numbers would be to not only purchase the property, but also get the money back to the investor by using two things; one, the refinance, and two, the cash flow. Because, the increased cash flow I quickly saw from the lease option, over and above a tenant. So, rather than making 250 quid a month, the cash flow was more like 650 to 850, depending on the month. And sometimes, into the thousands, as this property went on. And, as I got more experienced, I got more reviews, my account built up, start to understand dynamic pricing, the algorithms, and all the great stuff that we’re going to talk about across this series over the next whole 30 days.
So, that was my first few properties and a great insight into that. I’d already started building my net wealth, which was fantastic. Happened a lot sooner. I really didn’t know much. I just kept learning on the job. And then, numbers four and, let me think about this, now I’m going back here, number four was a rent-to-rent gig. I remember it now. In fact, numbers four to, it would be 11, were rent to rent. What I basically did was, I noticed that across these three properties, there was a company that kept booking every week, but they kept booking on booking.com. And with booking.com, we get charged fees, so I was starting to get a bit frustrated that they wouldn’t book direct, even though I was sending them emails saying, “Please, if you come back next week.” But anyway, I did what I should have done long before I did it.
I picked the phone up and I spoke to the individual that was making the bookings. She told me that they had an abundance of staff working in the area, not just the ones that were in these properties. And ultimately, that got me thinking, I then asked how long they were here. It was quite an extended amount stay. They were working on development. At this time, I just thought Airbnb was people travelling for tourism. Like many of you probably listening today, you probably think it’s just all about tourism. It’s not, it’s the complete opposite, especially in the UK. So for me, it was this contractor market that started to open up, and she asked me if I had enough room for all the other people. Naturally, I said, “Yes”, even though I didn’t. So, I panicked and basically, that got me off my ass to go and find these extra properties, so I could fill that contract.
In two weeks, I acquired and set up all these properties. I did it by picking up the phone to my phone book. I did it by going after my low-hanging fruit. I did it by doing what needs to be done to get the job done, rather than thinking about the excuses as to why I’m not doing it. I found properties, I spoke to people, and I told them what I was trying to do. I told them about the contract that I had. And ultimately, I then managed to be able to rent the properties and put deals together. This game is a relationship game, it’s 100% relationship game. If you speak to people in the right way, you communicate in the right way, you will get the deals that you need, and that’s all you have to do.
Now, I’m going to have to scratch my head here a bit, because it’s a long time ago. It seems a long time ago that these were the initial 21, but from 11 to 15, if I remember rightly, I then had a landlord call me, and actually, that’s correct. I had a landlord call me and he responded to one of my Facebook ads that I had on. And, he thought I was a letting agent, and he had a property to let, so I went along and had a conversation with him in a pub. And then, I explained what I was doing with the Airbnb game. A lot of landlords don’t know this game exists, even though this guy being a landlord for quite some time, he had 21 properties, and I started to talk about how we could make it work.
These properties we took on within a joint venture agreement, where I would bring the operation, he would bring the property, and we split everything after the cost was considered. And, that works very well, and even to this day, we’re currently working with that landlord, went through his full portfolio to get it all implemented into the short term rental industry, as and when his tenants are leaving, and then we’re probably having to do a bit of a refurb on some of the properties. After that, I then went into the management side of things, because of my social media work, and because of what I was doing to document my journey online, I then got a phone call saying that there was a block of flats that needed managing, and they had seen what I’d done in the space in quite a short period of time, and they felt I was a good operator. So, they wanted to dig in a little bit more. We had a few offline conversations and long behold, we then took the flats on. We’ve still got those flats today, and we have a great relationship with the owner.
And, that was my first step into the management side of things, or the co-hosting, as it’s known as. And, that has become a big part of my business, now. And, I would encourage anyone that’s looking to get into this, once you have your systems and processes nailed, you can really start leveraging different revenue streams from this one industry. And, that’s why it’s so magical.
So, that was how I put together the start of my portfolio, in terms of the different deal types and creativeness. Now, the main thing to note just focuses on a win-win, focusing on adding value to somebody else. Focus on solving a problem for somebody else, and you will get there. This was a problem where the person could not, and did not want to be a landlord. They had inherited property, they did not want to be a landlord. They had a bad tenant that had one experience, they wanted out. Okay. This was a problem for a family who again, had inherited a property. It was absolutely trashed. There wasn’t trash, sorry. It was un-modernized, should we say, but in today’s world, it was a bit scruffy and it needed a lot of work.
They didn’t want to do the work. They’re not property people. They inherited the property. They want out of it. The second one, or should I say, the third one was an auction property investor who didn’t want to do the work on the property that was required, had a tiny bit of movement going on in the house, and a lot of damp work. But, I put together the offer, I pieced it all together and managed to make it work. So, that’s how I did that.
These rent-to-rents were me just literally finding low-hanging fruit, and having great conversations with people, asking good questions. Each one of these landlords had a problem, which typically revolved around void properties or bad tenants, previously. So, they wanted to try something different.
And, these properties here on the joint venture, that was me just thinking outside the box, of how I can make it work with this landlord that didn’t just want a fixed rent. He didn’t just want the normal tenant rent that he was getting from his tenants right now, he wanted something a bit more. So, why not share the wealth? And, that’s exactly what I showed him to do. And then, the management style is just, as I said, that came from me just working hard on social media, documenting my journey, and showing that people can trust us to use our service and that we will deliver on the problem that they had, which was obviously a previous management company, not doing the job, not paying them on time, et cetera.
So, that’s how I got my first 21, and a lot of lessons learned in this, I wish I’d got help a lot sooner. I did all of this by myself. I set them all up. I ran all the guests and I blew up. So, one thing is that I wish that I’d got help a lot sooner, probably around this sort of four or five-point mark, I wish I’d got some help in. I did learn from that, I got a bookkeeper and I got a VA in, and that started to smooth things down. I then acquired another 40 in the next six months, because I was able to get back out there on the deal side of things and build those relationships, but we’ll come onto that later on.
And, something I teach my students is how to run effective businesses, how to say no, which is really important and how to build teams. Because, if you want to grow, you’re going to have to build a team, and you got to look at investing in staff, and you got to look at investing in technology.
So, that’s it for today. In the next episode, we’re going to be talking about how you can get started in Service Accommodation with no money, and also looking at the rent-to-rent strategy, in detail. So, make sure you subscribe to the channel and the playlist, and give me a little like and comment, so you don’t miss out on the next episode.