Couple build a lucrative rent-to-rent business during pandemic!
A total of 28 rooms in five houses producing an average rental profit per month of £4,500. The numbers are certainly stacking up for two entrepreneurs aged 24 and 22. Troy Badaloo and Kayleigh Pritchett have bagged a clutch of no-money-down rent-to-rent deals in a housing hotspot since joining the Property Investors Academy. Even more impressive is the fact that they have built their business during a global pandemic while still holding down their day jobs!
‘Everyone told us we shouldn’t do it’
Their closest friends and family warned them against spending money on property training with Samuel Leeds, saying they were being sold a pipe dream. But Troy and Kayleigh stood firm and enrolled on the academy programme after attending the Property Investors Crash Course in August 2019.
After two initial setbacks, the couple secured their first rent-to-rent agreement just before the first lockdown and went on to clinch two more deals, using their new knowledge and skills.
Even now some family members still say they shouldn’t have taken the plunge, despite their success, although 24-year-old Troy is hoping they will eventually change their minds.
“I had a lot of people telling me to be careful and not to do it but from seeing Samuel’s videos, what he stood for and how he was doing the training, I thought, why would I not do it?”
As an accountant, Troy was confident that he and his partner, with her operational skills, could make a go of it and took out a loan of £10,000 to pay for the academy.
“The way I saw it, it was an investment in ourselves,” says Troy. “But it was hard getting rejections at first and being told it was crazy to spend that money on training. They kept saying how are you going to make money from rent-to-rent? It doesn’t make sense.
“I can’t blame them because before we did the training, we didn’t know anything about it. If anyone had told us about that, we would have probably been in the same mindset. They were just trying to protect us.”
Admin worker Kayleigh admits she had doubts because of the opposition they encountered but having each other kept them going.
“I think if I was doing this on my own, I wouldn’t be here now. In the beginning when you’ve got so many people shouting no at you, it does make you think. Luckily, we had each other saying come on we can do this.”
Their property journey started in January 2019 when Troy saw a Facebook ad about no-money-down deals. They decided to go on a course and started looking at buy, refurbish, refinance opportunities.
However, nothing materialised, so they went on YouTube to pick up some tips. One name kept popping up, Samuel Leeds. One of his videos, filmed for his popular Winners on a Wednesday series, hit home. It featured Property Investors students Jordan Boparan and Jessica-Marie Bradshaw. They were also in their twenties, like Troy and Kayleigh, and had set up a successful rent-to-rent business.
“We thought that sounds like a better idea because there’s less money down. Straight after that we went on the Property Investors Crash Course. It was amazing. We learnt all the different techniques and the energy there was beautiful.”
Kayleigh agrees: “We went to another course previously which didn’t compare. Just the energy itself was wonderful. There were so many amazing people in the room as well and networking opportunities. We learnt so much. It was what we needed to get started.”
‘The Rent-to-Rent Revolution course was mind-blowing’
On the back of the crash course, Troy and Kayleigh jumped onto the academy. The first event, which they attended, was the Launchpad, followed by the Rent-to-Rent Revolution.
Troy describes the rent-to-rent course as mind-blowing. “Again, the energy was the biggest part for me. When Samuel is on the stage teaching us the content, the way he executes that is inspiring.
“At school, you’re at your desk and someone is telling you one plus one is two – you could fall asleep. But there I’m learning about all this new stuff and the income potential of what it’s going to do for myself, Kayleigh and all our family. It just got me so excited.
“Everybody else is invested into it as well and going along the same path. They want to get into big things and there is an energy that comes from that too. It gives you a buzz.”
From that day on the pair focused their efforts on pursuing the rent-to-rent strategy. They came close to securing two deals at the end of 2019, but both fell through.
Determined to press on, they kept looking for opportunities until they came across two rental properties each with six rooms which were being advertised on Rightmove. One was in Gloucester, where they live, and the other one in Bristol. The same company was operating them both.
It emerged that one of the four shareholders was managing the houses on her own and was looking to sell the company. Troy and Kayleigh suggested that their business, T K Lifestyle Properties, take on the properties instead.
“They said if you want them, you can pay us £45,000. We negotiated them down to £35,000 but said we would pay them out of the profits and do that over a 16-month period. We structured it as a lease option agreement, so after 16 months we will have 100 per cent access to the profits,” explains Troy.
“Each one is making a profit of £1,500 a month. They’ve been pretty much full even through lockdown.”
In April 2021, 11 out of the 12 rooms were let and they were waiting to find the right tenant for the remaining one.
Property Investors Academy teaches the couple persistence
It took five months for them to complete their first deal, so Troy and Kayleigh have learnt to be persistent. During his training Troy received powerful mindset exercises as part of his personal development.
“That was a very big factor in helping me with this deal. Through that development process I came to learn about the ‘go for no’ process. You’re not always going to get the right deal straight away. You can get 100 no’s and then a yes. You’ve got to keep going.”
Kayleigh too has learnt to be patient and to accept that even now they can still get refusals, although a lot of their subsequent offers have been accepted.
After their first rent-to-rent agreement they obtained two more from a different landlord. Both properties have five bedrooms and are round the corner from each other in Bristol.
Kayleigh sent out a number of direct to landlord letters and one of the recipients got back to them after checking out their website and offered them the deals.
“One of them has en suites in every room, so it’s ideal for tenants. They’re really good properties,” says Kayleigh. “We have minimal voids on them. One tenant left but we had it filled the next week.”
Troy confesses it was scary committing to paying the landlord a guaranteed monthly rent of £4,000 for the two properties. However, their training showed them that it made sense.
“From all the information we’d got already we knew that you’ve got to get uncomfortable and, as long as the research shows it’s going to work, then you’ve just got to go with it.”
Bristol is the ‘new London’ for investors
As part of the Property Investors Academy programme, Kayleigh and Troy attended the Deal Finding Extravaganza course, where they learnt how to find a patch. As a result, they headed for Bristol, dubbed the ‘new London’ by some investors because of the opportunities there to make money from the housing market. The city is only 40 minutes away from Gloucester and they know it already, so it was a ‘no brainer,’ says Kayleigh.
Clever marketing has also enabled them to fill their rooms quickly, despite the coronavirus outbreak which has affected some landlords. They make minor edits to their listing on SpareRoom to keep it at the top of local search results and pay £10 every three days to boost the ad. They also make sure their photographs are professionally taken to wow prospective tenants.
While both of them are overjoyed with their success so far, the couple very much feel it is just the beginning of their journey to becoming full-time entrepreneurs. Both cite the freedom property gives them to do what they want as their main reason for being in property – that and the realisation that they would never achieve their financial aspirations fast enough through climbing the corporate ladder.
Troy sums up the benefits when he says: “Growing up I only went on two holidays. It would be really nice to take my mum, sister and Kayleigh’s family for a nice holiday and not to have to worry about the price tag.”
Troy and Kayleigh’s tips
- Troy: “Just because things seem difficult now it’s not always going to be difficult. Be persistent and be creative.”
- “Get the training. If you go into this blindly, you can lose so much money if you don’t know what you’re doing.”
- Surround yourself with people who are doing what you want to do and are in places that you want to be in because it’s such a gamechanger.
- Kayleigh: When you’re starting out, set up your website, emails and social media to prove you’re legitimate. Get systems and processes in place as well so that when you do get a deal you can present that to landlords and investors to prove you know what you’re doing.
Samuel Leeds’ verdict
“Everyone thinks with property you need a lot of money to get started. Troy and Kayleigh structured their first deal by paying the company director out of the profits from the property which would come later. It was effectively a ‘buy now pay later’ scheme. I love that. It’s so creative.
“They’ve also completed HMO and buy, refurbish and refinance training and are now looking for a joint venture partner to put down a deposit on an eight-bed house share with a view to doing it up. It’s a below market value opportunity, which they found off market while trying to source a rent-to-rent, so I may well be interested myself!”
They had no guarantor, nor the ability to pay £4,000 a month from what they were earning but knew they could fill the rooms from carrying out their due diligence.
“That was the guarantee. The demand was there, and the numbers worked. We’ve also got processes in place to make sure we get high quality tenants because a bad tenant is worse than no tenant.
“We filled them up very quickly. They’re some of our best properties. The ten rooms are renting out for an average of £600 each. So, after bills we know that as long as we keep the rooms filled, we can keep on paying him the rent.
“The profit on those two properties is £1,100 per month.”
For their next rent-to-rent deal playing the long game again proved to be crucial. Through Gumtree they found a large house on the market in the Montpelier area of Bristol. Troy first saw the property in September 2019 but had to wait to seal the deal.
“A ‘no’ now is not always a ‘no’ later, so by following up with the landlord we managed to close it a year later. The profit on that one is £1,000 a month. It’s in a very good area and the demand is very high. We filled all of the six rooms in two weeks.”
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