Property Entrepreneur www.ebook3000.com Property Entrepreneur T H E W E A LT H D R A G O N WAY T O B U I L D A S U C C E S S F U L PROPERTY BUSINESS Vincent Wong www.ebook3000.com This edition first published 2016 © 2016 Vincent Wong Registered office John Wiley & Sons Ltd, The Atrium, Southern Gate, Chichester, West Sussex, PO19 8SQ, United Kingdom For details of our global editorial offices, for customer services and for information about how to apply for permission to reuse the copyright material in this book please see our website at www.wiley.com The right of the author to be identified as the author of this work has been asserted in accordance with the Copyright, Designs and Patents Act 1988 All rights reserved No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, except as permitted by the UK Copyright, Designs and Patents Act 1988, without the prior permission of the publisher Wiley publishes in a variety of print and electronic formats and by print-on-demand Some material included with standard print versions of this book may not be included in e-books or in print-on-demand If this book refers to media such as a CD or DVD that is not included in the version you purchased, you may download this material at http://booksupport.wiley.com For more information about Wiley products, visit www.wiley.com Designations used by companies to distinguish their products are often claimed as trademarks All brand names and product names used in this book are trade names, service marks, trademarks or registered trademarks of their respective owners The publisher is not associated with any product or vendor mentioned in this book Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose It is sold on the understanding that the publisher is not engaged in rendering professional services and neither the publisher nor the author shall be liable for damages arising herefrom If professional advice or other expert assistance is required, the services of a competent professional should be sought Library of Congress Cataloging-in-Publication Data is available A catalogue record for this book is available from the British Library ISBN 978-1-119-32640-3 (pbk) ISBN 978-1-119-32642-7 (ebk) ISBN 978-1-119-32750-9 (ebk) ISBN 978-1-119-32751-6 (ebk) Cover Design: Wiley Cover Image: © retrorocket/Getty Images, Inc Set in 11/13pt NewBaskervilleStd by Aptara Inc., New Delhi, India Printed in Great Britain by TJ International Ltd, Padstow, Cornwall, UK www.ebook3000.com For my father, who entrusted me with representing him on my first ever business trip and inspired me to follow in his footsteps www.ebook3000.com Contents Preface ix Acknowledgments xi About the Author xiii Introduction: My Property Journey Part I The Old Deal Chapter The History Of Property Chapter Traditional Property Investing 17 Chapter Who Wants To Be A Property Investor? 21 Part II The New Deal Chapter What’s Wrong With The Old Deal? 41 Chapter Understanding The New Deal 47 Chapter Starting Your Property Business 59 Chapter A Systemized Business Is A Successful Business 65 Chapter Seven Dealmaking Strategies 93 Chapter Dealing With Objections 129 Chapter 10 The Seven Golden Rules For Property Entrepreneurs 139 vii www.ebook3000.com viii Contents Part III The Real Deal Chapter 11 Probate Property In Leeds 147 Chapter 12 Property With Registered Charges Against It In Stanmore 151 Chapter 13 Urgent Sale Needed To Clear Debts In Birmingham 157 Chapter 14 From BMV To Lease-Option Deal In Liverpool 163 Chapter 15 Urgent Lease-Option Deal In Lincoln 167 Chapter 16 Lease-Option Deal On Dilapidated Property In Sheffield 169 Chapter 17 Part Now, Part Later Deal On Probate Property In Barnsley 173 Chapter 18 The Dutch Deals 175 Final Word: The Future Of The Property Business – Your Role Index 183 187 www.ebook3000.com Preface W hether you’ve been investing in property for years, or you are a complete newbie, eager to learn and frustrated by not having the money or credentials to get on the property ladder in the traditional way, this book contains some of the most important information you need to know I wanted to write this book because, when it comes to finding and buying property, I have a wealth of knowledge I want to share The methods I will be discussing are not those generally talked about Why? Because none of them benefit the middlemen … the banks, the government and the estate agents! Whether you decide to use any of these methods or not, I believe you have a right to know about them, to have all this information at your disposal I think anyone who is serious about investing in today’s property market should have access to this information Everyone deserves to know all the potential options I’m not suggesting that these new types of property deals are easy, and this is not the “one-size-fits-all” approach that is usually taken in traditional property purchasing Indeed, some types of deals are only applicable in certain specific circumstances However, if you want to be in the property business, I believe you have to think like an entrepreneur And as an entrepreneur, you need to gather all the information you can lay your hands on so that you can always make an informed business decision The information in this book is based on all my years and extensive experience in the property business; I believe I have an obligation to share that with you Every method I describe in detail in this book I have tried and tested myself Knowledge is power and, for too long now, the balance of power has been in the hands of the people who are feeding you information based on what is best for them, not you The estate agents, the lawyers, the lawmakers, the government and the media are not thinking of your best interests when they advise you, no matter how they dress it up Do not let them convince you ix www.ebook3000.com x Preface otherwise! My advice, to anyone on any issue is get informed, and then make the best decision for YOU! I hope you enjoy this book, I look forward to meeting some of you some day and I wish you all the best on your journey through the property business! www.ebook3000.com Acknowledgments I am indebted to so many people for helping to make this book happen Firstly, thanks to everyone at John Wiley & Sons, especially Thomas Hyrkiel, Jeremy Chia, Gladys Ganaden, Tessa Allen and Caroline McPherson Thanks also to Miranda Leslau for all her ongoing hard work and expertise in PR My deep gratitude goes to my family and friends, for your love and support I wouldn’t be where I am today without the support and guidance of all my mentors; your wisdom has helped me become a proud mentor to others who are starting out or re-establishing their property businesses We all learn from each other; the learning process never stops I want to thank everyone who works within my property team for helping to run a smooth and successful business, especially my Dutch partner and dear friend, Marina de Haan, and my sister, Florence, for expertly doing so many deals on my behalf But mostly I am hugely grateful to all the sellers who have ever put their trust in me; whether or not we made a deal, we worked tirelessly together towards a win-win situation I am always honoured and often humbled to learn about your lives and the circumstances under which you become motivated sellers You are the ones who drive my passion for the property business … which, for me, will always be a people business xi www.ebook3000.com About the Author Vincent Wong is co-founder and Executive Chairman of Wealth Dragons Plc An internationally recognized and respected property entrepreneur, Vincent has generated over 100,000 motivated seller leads to date and has helped hundreds of investors acquire properties with little or no money down In addition to building his own multimillion pound property portfolio, Vincent has taught dealmaking strategies, including lease-option deals – on which he is a world-renowned expert – to investors throughout the world As an internationally-recognized public speaker and expert in the property industry, Vincent is regularly invited to speak to audiences of 1,000+ delegates at the prestigious Property Outlook Conference in Kuala Lumpur (the biggest property conference in Asia) Vincent is a graduate of The University of London’s School of Pharmacy and holds an MBA from Cass Business School xiii www.ebook3000.com The Dutch Deals 177 Facilities Management at university and then did an MBA This took her to the public health sector She worked in administration and supply chain logistics for the Dutch health care system On one level, I suppose this gave her a love of helping people This was one of the first qualities that I identified in her … that she was a people person This is critical for our business She was well rewarded within her field, once earning the title of “manager of the year”, so I knew she also had excellent organizational and managerial skills She had travelled extensively and this seemed to have given her strong self-confidence and an openminded, balanced outlook She also had some experience of commercial property – from the time when she worked in elderly care and was involved in changing a building from a public-funded estate to a commercial enterprise – and had bought a few investment properties for cash For all these reasons and more, I knew she was going to be an excellent business partner for me It took us almost a year to set up our property investment business in the Netherlands The bank account alone took six months to open, because we were a UK-registered limited company We had to get all the forms and contracts written in both English and Dutch, and the translations notarized It was a nightmare, but worth it in the end as business has been so successful Our first deal (not the greatest we’ve done but it helped boost our moral) closed in April 2014 and since then we have not looked back We try to focus on BMV deals because lease-option deals are only possible if there isn’t too much negative equity, but we still consider everything because … we love a challenge! A Bad Bank! One of the earlier deals we got involved with shows just how the property market and banks act against the population in Holland We were contacted by a man who said he was desperate to move house He was a married police officer with two young children He had been threatened in his home by a released criminal seeking revenge, so they were feeling particularly uncomfortable in their own home He was in a negative equity situation so he couldn’t sell up on the open market without taking a loss and owing money he didn’t have; a lease-option deal was clearly the only way forward 178 Property Entrepreneur Our first move was to contact the bank to try and get permission for the seller to rent out the property We knew we couldn’t anything without that We waited and waited, and the bank never came back to us Eventually the seller moved out, rented a new place for his family and leased out his own property illegally to cover the rent in the new place He was actually about six months behind in his mortgage payments, too More than a year went by before the bank made contact … and it was not to give the seller permission to let, it was to call in the arrears! But this guy had nothing; he couldn’t pay his debts To make matters worse, he had also lost his job; he was in a really bad way Eventually the bank took the man to court and threatened to repossess the property and sell it via an auction At this point, we found out that the bank had originally written to this man to try and get his written permission for them to put the house on the open market But the man was a joint owner with his wife and the wife had flatly refused to sign the agreement She had been frightened that they would lose their home However, they had now ended up in a very bad situation They had mounting debts, the man was unemployed and they had an illegal tenant in their house My business partner went with the man to court and explained his whole story She explained how the man had tried his best to get permission from the bank to rent out his property She also explained how disgusted she was with the bank’s treatment of this homeowner She told an interesting story about how the contact at the bank had ended up a contact in her LinkedIn network, so she’d written directly to him to ask what on earth had been going on He told her a sob story about his wife being sick and then dying Her response, quite correctly, had been: “That’s very sad and I’m sorry for you, but that is irrelevant to this case!” She told the court that she’d subsequently made a formal complaint at the bank Interestingly, the bank did not send a member of staff to the court case (probably arrogantly assuming the case would automatically be ruled in their favour), only their lawyer was present, so the judge actually started to become sympathetic to the man’s case When this guy got up in court and basically said, “I’ve been a police officer since I began working, I’ve defended the lives of the people in this country with my own life, and this is how I am treated?” the judge completely came down on his side, saying that she could see too many strange things going on with the bank’s behaviour She ordered a The Dutch Deals 179 review of the case and asked the bank to come back with a fairer deal She could see that a lease-option deal would be a good solution; the monthly mortgage would get paid and the house could be sold after a couple of years without any debt The bank took its time to come back to us, during which time the man was at least able to get some police compensation for being unable to work due to stress Finally the bank came back with the idea of giving the man’s debt to a debt manager, which hardly addressed all the problems on the table It was a terrible proposal! All this man really wanted to was to go back to Morocco, where he was originally from, and disappear He was broken and burnt out He had lost all confidence in himself and could not bear to tell his children, who were aged five and seven, that he had failed them In the end, the bank forced the man out of his house, making him effectively homeless and facing a €30,000 debt The bank was ruthless when there was a perfectly acceptable win-win situation on the table No, they wanted to win their way, no matter if they put a man and his family out on the street with a crippling debt Turkish Delight! This next story is one of my personal favourites (and the one I referred to in an earlier chapter) My Dutch business partner was in The Hague when she was contacted by some people who’d seen her ad online She normally did all her deals over the phone, but the property was very near where she was heading for a meeting so she decided to go and see this couple who said they were in dire straits When she arrived at the property, she found a female owner sitting on the steps outside, utterly dejected The story was that this woman was due to move back to Turkey, where her husband was already based They’d got a buyer for the house, they’d moved out into a temporary place, sold all their furniture, taken their children out of the schools … they had both already quit their jobs in the Netherlands; they were ready and waiting to go But that’s when the buyer dropped out suddenly, claiming he couldn’t get the financing together It was a little naăve to have sold all their furniture and moved before the sale went through, but that just made my business partner want to help them even more, so she suggested a lease-option deal Now came our dreaded next move … applying to the bank for permission to let Usually, in Holland, you apply to the council first; 180 Property Entrepreneur if they give their permission, then you go to the bank, and they usually say no! Even if they say yes, they force you to pay an outside company to process the mountains of paperwork they require This company never visits the property; they just pick an arbitrary figure out of the air and charge you a fee for a whole year, basically for doing the work that a lettings agency would normally do, but without finding you the renters! Or they won’t find suitable renters, or will not negotiate the correct rent that you need When we explained we didn’t need them to this work, they said fine, but we had to pay a compensation fee to them When we asked why, they explained that they would lose out on an administration fee they charge to renters and the commission they could collect on the monthly rent! Only when we made a serious complaint to the bank did they back down The paperwork for this deal was a bit ridiculous, but we did finally get the consent to let and completed the lease-option deal with the Turkish couple, who were then reunited in Turkey They were so profoundly grateful they put a glowing testimonial on our website and extended an open invitation to us if we ever want to visit Turkey! Sadly though, this story did not quite end there A year later, the bank was on the phone asking why the property was not yet sold We explained to them that it was because the property was still in negative equity, and pointed out that we had their consent to let for five years It’s a formal condition of the agreement that you should put the property on the market (which we always do, but obviously for a price that covers the mortgage and costs) For three months we kept talking to the bank trying to convince them there was no need to sell the property this year because the market was picking up and we would be able to sell without occurring a debt in a couple of years But at the beginning of 2016, the bank forced us to sell, threatening to revoke the consent to let if we didn’t! We couldn’t be left with a property on which we had to pay a monthly mortgage but couldn’t let out … so we were forced to sell at a loss Not the happiest of endings! * * * I was attracted to doing business in Holland precisely because of the stringent rules there Part of me wanted to help fight the injustice, to give the people their voice There is no good reason for the system to be as autocratic as it is We all know the law has to change; I want to be a part of that We go in using guerrilla tactics We are building The Dutch Deals 181 a system to try and bypass the banks and work directly with private equity companies and significant investors We’ve already made some big waves by getting our first lease-option deals legitimized However, the challenges we faced were so complex that we’ve decided to use different strategies in Holland For example, we have started to sale and rent back deals (which are not feasible in the UK anymore) We are also championing a property fund to give investors another way of getting a return from property investment Certain strategies are better suited to certain countries because of their different rules Of course, with things the way they are, when we a good deal in the Netherlands the added reward is the extreme gratitude of people when we find them a solution for what they had assumed was an impossible situation! Property Entrepreneur: The Wealth Dragon Way to Build a Successful Property Business By Vincent Wong Copyright © 2016 by Vincent Wong Final Word: The Future Of The Property Business – Your Role W hen I first start talking to people about the strategies outlined in this book, they always say, “But who would that?” I explain that lots of people would and have Indeed, I am in business with many of them! I have experienced these strategies as an investor, as a landlord and as a tenant Indeed, at the time of writing I am playing all three roles: I am a landlord with rent-to-buy tenants in my properties, I am a mortgage host and I am a rent-to-buy tenant The bottom line is this: ordinary people with ordinary salaries can no longer get onto the property ladder I’ve explained why this is several times throughout the course of this book; I’ve shown how the figures simply don’t add up The only way ordinary people with ordinary salaries (who have not inherited cash or been given a lump sum to invest in property by family or friends) can get onto the property ladder is to treat property like a business and raise capital from investors in order to start this business I believe that everyone deserves to know what is available to them, otherwise they are operating under “unconscious incompetence”, i.e not knowing what they don’t know Or as Donald Rumsfeld put it: “There are known knowns These are things we know that we know There are known unknowns That is to say, there are things that we know we don’t know But there are also unknown unknowns There are things we don’t know we don’t know.” Now you know what you know, you have a responsibility to take this information to other people Your role is to learn how to use these strategies and then teach them to others, so that everyone has a fair chance if they want to better their lives The property business is not for the faint hearted But for the strong hearted it can be exceptionally rewarding However, you have to be prepared to take risks Most people are unable to this If you speak to an ordinary person and say, “Hey, I am going to ask you to 183 184 Final Word: The Future Of The Property Business – Your Role work harder than you’ve ever worked, but I will only pay you based on your results Plus, you will get no holiday, you will work longer hours than all your friends, you’ll have to another job to bring in money to pay the bills, you’ll get a hard time from many other people, especially friends and family, you’ll have to beg for funds and still pay the tax man …” most people would run a mile and ask, “Who the hell would that?!” I say … entrepreneurs! Most people are raised to stay in a very safe zone They want that guaranteed pay cheque If they – or someone they know – has never experienced something, they think it can’t be done There is a chasm between the way regular people in the rat race think, and the way entrepreneurial business people think This is not for everyone … this will cause you stress and make you scared, you will lose sleep, you will probably lose friends (who don’t believe you are doing the right thing because it is “outside of the box”), but the rewards might be huge If you want to guarantee that you sleep well at night, have no worries, never feel fear, always feel in control, then don’t this! Get a regular job, get your pay cheque, have a fear-free life, but don’t complain and say you want more! Be happy with your lot I listen to people all the time who tell me their goals and dreams … but they are not willing to what it takes Everything you have read in this book could radically change your life But most people, even when they’ve read this book, won’t it Is there any guarantee of success? No But you can give yourself the best chance at success by doing the work, doing the research, reading the book, and then practising! I’m showing you a choice … a path for you to follow If security is paramount to you then it would be insane to this, but if you want to grow and excel, and have a chance at the best rewards possible, then go for it! The rewards are always better than anything you can currently imagine You think you can imagine driving an Aston Martin? Let me tell you, the reality is much better than you can imagine You think you can imagine travelling around the world First Class? Believe me, it is beyond anything you could dream up However … the flip side is that the pain, when things don’t go to plan, is worse than anything you can imagine You think you can imagine being broke, or losing £100,000? I promise you, you can’t You can’t imagine what it feels like to wake up in a cold sweat at 3am, realizing you are not having a bad dream, Final Word: The Future Of The Property Business – Your Role 185 that the nightmare is your reality and that you have hell to face in the morning I can tell you that with every pain barrier you go through, the pain lessens As you get older and more experienced, the pain diminishes, but the first time you go through it, it truly is hell! So it’s up to you: if you can face the pain, you’ll get the gain; if you can’t, you won’t … but that’s okay We are all different If you go for it, remember what Winston Churchill said: “Never, never, never give up.” Property Entrepreneur: The Wealth Dragon Way to Build a Successful Property Business By Vincent Wong Copyright © 2016 by Vincent Wong Index “Cs” of lease-option contracts 108–10 Dealmaking Strategies 93–127 Golden Rules for property entrepreneurs 139–43 Habits of Highly Effective People, The (Covey) 130 100-10-5-3-1 rule 80–1, 82–3, 141–2 bankruptcy 32–3 banks collapse of 14 developers colluding with 29 in Holland, treatment of homeowners 175–81 withdrawal of mortgage offers 26–7 see also lenders Barnsley case study 173–4 bespoke deals lease-option contracts 110 tenancy agreements 117 Birmingham case study 157–61 BMV (Below Market Value) deals 3, 34–7, 74 abandoned properties 70 common objections to 130–7 seller’s circumstances 80–1 “Bob the Builder” strategy 121–2 bridging loans 25, 35–6 bubbles 31, 43 bursting of 3, 26 buying at height of 15, 19 estate agents creating “mini” 44 Buffett, Warren 15, 34 builders (developers) as investors 25–7 “buy-to-let” mortgages 13, 42–3, 94–6 “buy low, sell high” rule of investing 15 abandoned property 70–1 ABC (Always Be Closing), sales rule 97 academics 24 adding value to lives 75, 88–90 advertising/promotion 69–73 AIDA (Attention, Interest, Desire and Action) 73 apartments, speculation 28–31 appreciation of property, benefiting from 20 Apprentice, The (TV show) 52 asking price, estate agents 43 asset vs liability 35 assets, learning how to control 20 Assured Shorthold Tenancy agreement 12–13, 21–2, 23, 95, 115, 119 bespoke agreement 117 attitude/mindset, adopting winning 54 auctioned property 132 automating your systems 86–7 187 188 Index buyer’s circumstances, deals driven by 106, 114–15 buying vs renting, and increased control 10–11 cash positive, remaining 142 cash-rich investors, finding 59–60 circumstances, fitting the correct tool to 109–10 communication skills 110 contract, lease-option deals 109 control option agreements 103 terms of deal determining 50 vs ownership of property 10–11, 19–20, 47, 116–17 council tenants, right to buy 12 Covey, Stephen R 130 cowboys 36–7 credit rating, attempts to protect 32–3 crises, opportunity arising from 3–4, 37–8 customization, lease-option contracts 110 Dealmaking Strategies 93–4 “Bob the Builder” 121–2 Lease-Options 104–14 Mortgage Hosting 96–7 Options 97–104 Part Now, Part Later 123 Rent-to-Buy 114–20 Sale and Rent Back 123–4 Sandwich Options 124–5 Seller as Lender 125–6 Tenancy In Common 94–6 debt clearance, urgent sale case study 157–61 debt-fuelled economic “growth” 49 debt servicing 32–3 demand, creating 61 deposits for buy-to-let mortgages 94–5 from friends and relatives 96, 97 saving for in today’s market 22, 42, 44–5 saving up for in the past 17 speculators putting down 28–9 developers as investors 25–7 discount 43, 74, 75 objections to BMV deals 130–1, 136 Dragon’s Den (TV show) 63 due diligence 121, 143, 147–8, 151–2, 163, 170, 173 Dutch deals 175–82 efficient markets 34 empathy, displaying 130 empty properties 70, 169 entrepreneurial qualities 51–4, 142 equity on property, releasing 35, 36, 43, 48–9, 56, 123 estate agents avoiding 50, 98, 125–6, 140 creating “mini” bubbles 44 distinguishing yourself from 69 motives/interests of 43–4, 98, 119 problems with using 44, 56, 76 profit-making game 48 ethical practice 36, 38, 55, 77, 124, 131, 141 eviction of tenants 12, 95, 115 exercising an option 107–8 “fallen angels” 31–3 “feel-felt-found” guidelines 130–7 Index fees legal 133, 134 option agreements 102–3, 104 feudal land tenure financial freedom 53 first-time buyers, difficulties of 41–2, 44–5, 50–1 first-time investors, strategy of 42–3 flexibility of property options 99–100 “flipping” a property deal 26, 37, 85, 89–90, 107, 108 versus keeping 82 freeholders, origins of 9–10 future of property business 183–5 gazumping 85–6, 149 protecting against 101–2 global economic crisis aftermath of 14–15 collapse of property market 30 Golden Rules 139–43 good will, creating 89 grantee (“optionee”) 99, 100 grantor (“optioner”) 99, 100, 108 Holland, deals 175–81 homeowners, investor status of 22–4 honesty 112 “hotspots” for property purchase 27–8 Housing Act (1919) 11 Housing Act (1980) 12, 115 Housing Act (1988) 12 Housing Defects Act (1980) 12 hypermarkets, creating property hotspots 27–8 189 inheritance of property 17, 35, 125, 147–50, 173–4 Inside Job (documentary) 15 integrity 63 investors eight types of 21–38 finding 68 joint ventures (JVs) 60–1 land law reforms 11–12 land ownership, history of 9–10 landlords and AST agreement 12–13, 21–2, 95 eviction rights 12, 95, 115 motivated 118–19 open-minded 117 “professional” 13 rent-to-buy deals 119–20 lawyers 55 finding open-minded 109 objections about 134–5 using trusted 133 leads, creating and following up 82–5 lease agreement 104 lease-option deals 4, 104–14 “C’s” of negotiating 108–10 exercising the option 107–8 negative equity trap 106–7 seller circumstance driven 105–6 seller’s questions, dealing with 110–12 WIIFT (what’s in it for them) rule 113–14 leaseholders 10 leases 13 Leeds, probate property 147–50 190 Index legal fees 133, 134–5 “legal right to buy", council tenants 12 legality issues 55, 110–11, 137 legislation debt owed to foreign company 153 inheritance tax 97 land law reforms 11–12 to protect homeowners 124 lenders friends and parents 96–7 irresponsibility of, pre-crash 14, 29 permission to let/rent 95, 105, 175, 179–80 repossession by 19, 24, 32, 49, 71, 88–9 sellers as 125–6 leverage 18–19, 142 option-driven 103–4 liabilities, getting rid of 32–3, 35 likeability 63–4 Lincoln, lease-option deal 167–8 liquid capital/resources 68, 142 Liverpool, lease-option deal 163–6 lock-out agreements 85, 101–2, 149, 152 Lynch, Peter 34 “market value” 55, 70 marketing system 67–76, 81 place/positioning 68–9 price 73–5 products 67–8 profit 75–6 promotion/advertising 69–73 message, getting across 73 middleman, bypassing 50, 126, 140 mindset, entrepreneurial 38, 53, 54, 64, 142 mini bubbles 44 modern land law 11–12 money laundering 176 “Mortgage Hosting” strategy 96–7 mortgages 17–18 arrears/shortfall 15, 49, 56–7, 71, 88 banks withdrawing 26–7 “buy-to-let” 13, 42–3, 94–6 debt problems, post-crisis 14–15 deposit for 60 desire to pay off 23–4 joint 94, 96–7 negative equity trap 106–7 qualifying for 42 motivated landlords 118–19 motivated sellers, dealing directly with 80–1, 139–40 negative equity 14–15, 49, 75, 106–7 negotiation skills 77–9 for creating qualified leads 82–3 terms of the deal 50, 75, 140–1 see also Dealmaking Strategies the Netherlands 75–6, 175–81 Network Property Buyers 2, 68 networking 3, 59–60 the “new deal” 47–57 new dealmakers 37–8 New Towns Act (1946) 11 “no-money-down deals” 35–6 novice investors 21–2, 41 numbers game 80–1, 82–3, 141–2 objections, dealing with 129–37 off-plan purchases, speculators 28–31 Index the “old deal” 7–15 investor types 21–38 problems with 41–5 traditional investing 17–20 One Up on Wall Street (Lynch) 34 opportunities 3, 61, 62, 176 option agreements 97–104 option period 99–100, 111–12 optionee, (buyer/granter) 99, 100 optioner (grantor) 99, 100, 108 ownership myth 10–11, 116–17 parents, help from 97 part now, part later deal 173–4 “Part Now, Part Later” strategy 123 people business 50, 160 people person 79, 177 place for a specific market 68–9 planning permission 103 positioning for a property entrepreneur 47–8, 49 marketing 68–9, 72 price, marketing 73–5 probate property 147–50, 173–4 problem solvers, entrepreneurs as 38, 51, 53–4, 176 products, marketing 67–8 “professional landlord", rise of 13–14 profit, marketing 75–6 profit maximization 66 property bubble 3, 15 bursting of 3, 26 mini bubbles 44 property business building and running 47–57 future of 183–5 starting 59–64 systematized 65–91 191 property developers building for speculators 28–30 ordinary people becoming 25–6 property entrepreneurs attitude of 54–7 positioning 47–9 qualities of 51–4 risk-taking 52, 183–4 rules for 139–43 terms of the deal 50 property ladder first-time buyers/novices 21, 22–3, 41–2, 90–1 seven strategies for 93–123 property ownership, traditional methods 17–18 property price increases 1, 41–2 property hotspots 27–8 see also bubbles property revolution 4–5 property speculators 29–30 pull advertising 71–2, 81 punctuality 63 push advertising 69–70 qualified leads, creating and following up 82–5 questionnaires for getting leads 83–4 questions of sellers, dealing with 110–12 real deal (case studies) Barnsley 173–4 Birmingham 157–61 Holland 175–81 Leeds 147–50 Lincoln 167–8 Liverpool 163–6 192 Index real deal (case studies) (Continued) Sheffield 169–71 Stanmore 151–6 “real estate”, origins of term 9–10 reforms in land law 11–12 registered charges against a property 151–6 renovation of properties 25–6, 121–2, 170–1 Rent-To-Buy strategy 114–20 rental prices, competition pushing down 30 rented accommodation, less control 10–11 renters see tenants repossession of property 19, 24, 32, 49, 71, 88–9 retention orders, surveyors 25, 26 return on investment (ROI) 18–19 rights of home “owners” 11, 19–20, 116 of landlords 12, 115 of renters/tenants 21–2, 23, 76, 95, 115 risk-taking 52, 183–4 rules for property entrepreneurs 139–43 “sale and rent back” deals 36, 123–4, 141 sales system 76–9 sandwich options 124–5 search engine results 72 self-presentation/appearance 62–3 seller as lender strategy 125–6 sellers dealing directly with motivated 80–1, 139–40, 176 potential leads, obtaining via your system 81–5 sellers’ circumstances 35, 80, 112 customizing contract to fit 110 estate agents not motivated by 43–4 importance of knowing inside out 113–14 lease-option deals driven by 105–6 understanding 159–60 selling, negative perception of 76–7 servicing your systems 85–6 Sheffield, lease-option deal on dilapidated property 169–72 short-term option contracts 101–2 solutions, providing 38, 50, 114, 118 speculators 27–31 Stanmore case study 151–6 stock market 34 stock options 99 Super-Rich and Us, The (documentary) 15 surveyors’ reports 25 systemized businesses 65–7 adding value to lives 88–90 marketing system 67–76 sales system 76–9 systems within the system 79–87 win-win-win situation 90–1 see also Dealmaking Strategies systems within the system 79–87 targets, setting 82–3, 141–2 tenancy agreement Assured Shorthold Tenancy 12–13, 21–2, 23, 95, 115, 119 changing terms and conditions of 116–18 Index “Tenancy In Common” strategy 94, 96 tenant-buyers 117, 124–5 tenants rent-to-buy deals 119–20 renter’s trap 115–16 rights 12, 13, 21–2, 23, 95, 115 terms of the deal, negotiating 50, 75, 140–1 terms of a lease 13 terms and conditions of tenancy, changing 116–18 Thatcher, Margaret 11–12, 22 third-party investor 108 time to build a system 87 title searches 152 toxic debts 14 traditional property investing 17–20 193 unethical practice 124, 133, 134 valuation of properties 27, 121 case studies 149, 151–2, 153–4, 158, 173 objections regarding 131–2, 133 value, adding to people’s lives 88–90 value investors 33–7 value system, well-balanced 66–7 WIIFT (what’s in it for them) rule 113–14, 120, 141 win-win deals 141 win-win-win situation 90–1 winning perspective, adopting 54 ... loan -to- value, so you always have to make up the shortfall if the value of the property falls); in residential property, you don’t have to give the bank anything as long as you keep servicing the. .. more than quadrupled; the price of that Clapham flat is almost ten times what a pharmacist can earn today This is a staggering gulf and does make you wonder who on earth can afford to buy property. .. that time I was working as a pharmacist and earning around £32,000 a year, so the flat cost just over twice my annual salary To put this into context, a similar flat in Clapham now, at the time of