Taekwondo champion Dylan Milne combines his sport with sourcing property investment deals and renting out serviced accommodation. It has made him financially free at the age of just 23. In an average month, he earns £9,000 to £12,000. But Dylan had to contend with failure initially. Samuel Leeds gave him some timely advice and Dylan prospered with the support of the academy.
‘I studied property while working nights in a petrol station’
During Covid Dylan was working day and night in a petrol station while studying for an Open University business degree.
Neither one of them was ideal. He hated the job, and the degree course was not what he thought it would be.
He completed the degree but felt it was just teaching him how to work for a business and not own one.
In the pandemic he came across Samuel’s YouTube videos on property. When he saw the Winners on a Wednesday interviews, Dylan couldn’t believe how much money the students were making.
So, he attended the £1 crash course and then used his savings to join the academy. It left him with just £50 in his pocket, but it was more than worth it in his mind.
“[I asked myself] in ten years’ time am I going to think about this £12,000? I'm happy I've got this. No, I wouldn't really be happy. But in ten years the alternative is I've invested it and if it does work then I could have a different life.”
His family thought he was ‘brainwashed through Covid,’ worried he was taking the wrong step. That made him even more determined to succeed.
There was an advantage to working in a petrol station at night. It allowed him to focus on his online property training because there were hardly any customers.
That was the only good thing that came from the experience, he says. “I was just drilling through the training. When it got to about four or five o'clock, I'd be emailing or texting people on OpenRent, getting their details.”
However, it turned out to be harder than he had anticipated. “I came in with all these expectations. I'm going to do this in the first month. I'm going to get all these deals. I didn't take into consideration that I had uni. I had my sports that I do as well.
“I just wasn't in the right mindset to do it. I was like, this will be easy, everyone's doing well and then the first 12 months was just hard.”
Dylan managed to do some co-sourcing, finding a few deals once every two or three months. But the work wasn’t consistent.
Then he took on a deal which went ‘bad.’
“I didn't do enough diligence. I just got trigger happy, thinking I need to get something. That went bad, so I was in even worse a position.”
At a low ebb and floundering, the rookie entrepreneur reached out to his guru Samuel on Instagram. In one message, Dylan wrote:
“Had two SA (serviced accommodation) rent-to-rents running and they've both had issues. I'm 22 years old… I'm so sorry Samuel. It's the first year. I feel completely broken. I've lost every bit of pride I had. I feel ashamed of how I promised my girlfriend I'd make it… I can't even pay for myself these days. I'm embarrassed. I know my little brother has a failing role model.
“I need to change this Samuel. I can't keep living like this any longer.”
Dylan looks back now and smiles at the memory, but at the time he had reached rock bottom. Samuel’s response was to ask him whether it was easy when he began learning Taekwondo. Dylan’s answer was no, but it was second nature now.
“It becomes the same in business. Now it's a lot easier than at the start.”
Being persistent and consistent paid dividends. He started making lots of calls to agents, while also attending networking events and academy dinners.
From being surrounded by family and friends who didn’t understand what he was doing, suddenly he was in a room with like-minded people.
“As soon as you get in that environment it's a lot better. At some of the academy meals now there are hundreds of people all doing well and all with the same mindset. It’s fantastic.”
Dylan refuses to take ‘no’ for an answer
A lot of Dylan’s earnings come from packaging and selling deals. He is also using the rent-to-rent strategy and lease options to build up a passive income and gain assets.
His method is to negotiate a company let on a property and then with the agreement of the landlord or the agent, and the correct contract in place, he rents it out at a higher rate. It could become an Airbnb or an HMO depending on the deal. Hotel chains like Premier Inn use a similar model, Dylan points out.
Having learnt the hard way that a bad deal is worse than no deal, he researches the market thoroughly before taking on a new property – either as a rent-to-rent or a deal which he can sell.
His starting point is to search Rightmove and OpenRent for leads. Landlords list their properties on OpenRent and he can message them to request more information. He also tries to get their contact details so that he can call them.
After identifying a target, he uses software like Property Market Intel which enables him to check the occupancy rates for rental accommodation in a particular postcode area.
“We use that as a base. Then we do more thorough due diligence on the area. We go on to Airbnb. We look at the quality of the apartment. If it's a high-end apartment, there's no point comparing it to what a lower-end apartment's getting. So, we look for comparables.”
His next port of call is booking.com to find out what is available locally and what demand there is for the type of accommodation he has in mind.
“When you search a postcode on booking.com and put in the night click search there's a little map. You can click on the map and when you go on that it shows you all the short-term rentals in that area. It also shows you which ones are booked.”
This gives him a good indication of whether there is money in it for him.
Letting agents are harder to get on board than landlords in his view because they receive so many calls in a day, often from inexperienced operators. Some may have watched a few YouTube videos and try to obtain a rent-to-rent agreement without proper training.
Dylan gets round this problem by calling in on agencies to attempt to build a rapport with them. “If you're local to a city like Liverpool, you can go into the agencies. You can speak to them about it.”
He adds: “Some agencies have done it (rent-to-rent) before, and they say we only work with credible deal sourcers or companies that have been running for over a year. They're quite easy about it. But obviously at the beginning you don't have that credibility.”
Unlike most people faced with rejection, Dylan refuses to take no for an answer. He will return to the agency the following week and make his pitch again.
He tells them he is looking for a two, three or four-bedroom house in Liverpool around the city centre and Anfield area with a L4 postcode. He also considers properties with a L6 postcode.
Dylan avoids using the term rent-to-rent because of the resistance some agents have towards it. Instead, he explains that he has a company, called Simply Made Sourcing, which rents out properties to corporate clients and professionals coming into the area for short to medium-term stays.
His aim is to get a viewing. If the accommodation is suitable, this gives him the opportunity to put forward a proposal to the owner.
By visiting the agent’s office, sometimes four or five times, it is harder to fob him off and he finds that properties are passed to him.
“They'll always get sick of you, and they'll say, ‘Alright, there you go.’
This has happened to him in Liverpool. “Now they don't put them online. They just come to me first and say will this work. If it does, we can just sell it straight away.”
The landlord/agent might ask for a guarantor to pay the rent if the company fails to meet its financial obligations. This could be a relative, a friend or a business partner whose income will be checked beforehand. But so far Dylan has avoided having to find a guarantor.
He includes a break clause in the rental agreement which allows him to pull out if it is not profitable.
“The last thing you want to do is get into a fixed three or five-year contract and it's not making enough money.”
Even if the arrangement works on paper, there are some ‘deal breakers,’ notably head lease restrictions which would prevent him from renting out the accommodation for short stays.
This is a potential pitfall with a leasehold apartment, where the freeholder who owns the block might have a restriction in place prohibiting such use. The renter could have spent thousands of pounds on bringing in new furniture and marketing the property only to see their investment disappear down the drain.
Some landlords are unaware of any restrictions in the head lease, Dylan says. He always checks the situation by obtaining the paperwork from the owner.
There are other hazards which might lead to the deal collapsing. Someone just coming into the industry might offer too high a rent and then it turns out the margins are too low.
“By now the landlord's got it in their head they could get this. So, they end up pulling out.
“What I found is the longer you leave it for the deal to be closed, the more chance you give it to fall through. I like to get it wrapped up within the same day, if not the next day.”
The landlord benefits from a rent-to-rent arrangement because Dylan is providing serviced accommodation and there are no tenants’ rights involved. If he defaults on the rent, his commercial lease can be terminated, whereas it may take months to evict a tenant for non-payment. Meanwhile the property owner is left with no income.
Dylan also offers a guaranteed rent for three to five years with no voids.
A lease option differs slightly from a rent-to-rent in that he has the option to buy the property down the line for a fixed price agreed in advance.
He recently clinched a lease option on a property after being referred to the landlady as a management company.
“She bought it for £185,000 three years ago and we've agreed £190,000 in five years. The market value right now is £210,000. It's a good deal.”
Dylan is paying her £800 a month and expects to make a monthly profit of £900 after his expenses. Those funds will be set aside and then used for the deposit in five years’ time when he comes to purchase it.
He has also just secured two units in a block of serviced apartments in Liverpool.
Property has proved to be the perfect sideline for Dylan, giving him not just more money, but also flexibility. He took up taekwondo when he was three and divides his time between training and hunting for deals.
“I'm able to go wherever I want whenever I want and I’m not having to work for somebody. It's fantastic.”
Dylan’s tips
- It’s important to stay consistent, be persistent and not make excuses.
- It’s amazing what you can achieve when you put all your effort into something.
Samuel Leeds
“I’m really proud of Dylan. He deserves an award for his persistence and the way he has turned around his business.”
