In today's article,I’ll be answer all of your property investment questions and honestly, i do this every single Sunday as I've helped hundreds and hundreds of people become financially free through investing in property.
It's free to ask questions and have me answer them as I've been investing in property for 12 years now and I've made millions of pounds investing in property.
Read through these questions and answers I provided as you learn a thing or two and if you have a question of your own, don’t hesitate to throw it my way as I’ll be answering more questions in the coming week.
Joe: Should I estimate the return on investment on properties I find? if so, how do I estimate the pricing of legal stamp duty? or should I wait until I know all pricing of legal stamp duty to work out the ROI properly?
Yes. Working out the return on investments is really simple as it's just a case of dividing the annual rent by the purchase price or by the value of the property. If the properties makes 10,000 pounds a year in rent and it is a 100,000 pound house, the yield is 10 percent.
You are correct though the return on investment is a little bit more complex as it factors in different costs like what's the mortgage payments going to be? what's the legal costs? what's the stamp duty? And therefore, you probably should begin to get an idea of how much those things are going to be.
I mean, to give you an idea, legal costs depends as it might be a thousand pounds.
Many different factors such as stamp duty which is three percent will again depend on the house whether you are going to be moving into the house to live there or you are going to be doing it as an investment property.
If it's an investment property and it's inhabitable, you won't pay stamps duty because it's already up-and-running.
Brian: How do you avoid the 3% on stamp duty tax for multiple properties as I'm about to own one that i live in and one that I’ll be renting out?
If you're buying lots of properties at the same time, i think it's six properties or maybe four, you'll get multiple dwelling relief which will save you on stamp duty.
If you're just buying one or two properties, this probably isn't going to apply to you because, i think it should be six properties but it's definitely not less than four.
You might have to just take stamp duty on the chin and sometimes, you just have to pay tax and that's okay as you know, i don't mind paying tax as I'll pay as little as i can but sometimes, you have to pay and you need to look at the bigger picture of how much you're going to be making on the deal rather than focusing on how much you're going to have to pay.
I prefer to just worry about making money and I know some people get so obsessed with trying to save every penny but remember to look after the penalties too closely as you might lose the millions.
Adam: I’m in my twenties working full time in property remortgage, how do i grow further and take things to the next level Capital required?
I'm not sure whether when you say capital required, that means that you've got the capital because you mentioned that you just refinanced your properties.
I don't know if you've got money or if you haven't got money but whether you have or not, my advice would be the same as i would say, firstly, congratulations as you're in your 20s and you've got a little portfolio going which is fantastic.
I would use your current experience to leverage more money and i mean, banks care about your experience but so do investors and if you've got a track record have been able to show that you can make money in property as you've bought Hmos in you case and they're going on successfully, what you could now do is find an investor even if it’s a private investor and show them your stats in hopes of getting them to invest in you.
Joint ventures are the way to go as most development deals are done by joint ventures and most people that have become very successful in property have done it via joint ventures.
If you want to go fast, go alone but if you want to go far, go together.
Q: Can i access the government grants or loans like the ones to get into your academy?
I don't think so as i don't think the government will give you a grant to get into my academy.
The education system is all created for you to go and get a job but with my training, things are very different as it is all created for you to be able to become financially independent and for you to be able to retire young and rich.
If you start going to the government asking them for loans to go on my training programs, i don't think they're going to give them to you.
Josh: Please can you speak about what certificates and licenses you need to become a landlord of a normal buy to let?
In the rules of business, everyone that cares and thinks about certificates and licenses and all that kind of stuff usually are very much in the job mentality as you don't genuinely need any certificates or any licenses or qualifications to buy and rent out a house.
There are some areas where this is not the case as there are some types of properties where this is not the case for example, if you're buying a property in wales where i do own some properties, you do need a license to buy a property there.
To get a license is really easy as it costs a hundred pounds and you just fill out a form as it's very easy to get one but if you're buying a Hmo property and there's five or more people living in the HMO, you need a HMO license.
Therefore, you do need need licenses sometimes but generally speaking, you do not.
If you want to be a doctor, you got to go to the university and it's a long process but to be an entrepreneur, there's very little formal education that is needed. However, i do strongly believe that you need self-education because self-education will make you a fortune but traditional formal education will make you a living .
Q: I have a 75,000 pound property which comes with headaches like, every four to six weeks, i get a call to fix something such as a pipe leak in the bathroom or kitchen. Should my next one be a better house, like, a 150,000 pound worth, to attract better tenants as i feel the higher end houses will appreciate more in the future and i want to make wealth in this recession?
Yes, the rental yields would be a lot less but i think capital growth is key in recessions as I believe it's so annoying when you have a house and every six weeks, something breaks in it and i don't think that's so much to do with the house being a cheap house though i think it might be more to do with the condition and age of the house.
If you've got a house that's a bit old inside or it's a very old house it can be really problematic.
I don't think going for a more expensive house is necessarily and what i mean is that the house that i live in, i rent it and my landlord's always having to pay for things and fix things such as when the gate breaks,it's like two grand to fix and so having a more expensive house doesn't necessarily mean that there are no repairs and no maintenance issues.
The answer is to have your house done to a good standard, and of course, yes for sure, if your house is in a bad area with really rough tenants then that is potentially going to be a problem but you don't need to buy a house that’s really expensive to get it in a decent area as you just need to buy a house in a decent area.
James: Case study one 200,000 pound house in city centre near the university or two one hundred thousand pound houses outside of the city centre near another university campus where ROI is pretty much the same. Wondering if the benefit of having two properties outweighs the ease of one?
I'm very surprised that the ROI is the same but if the ROI is genuinely the same, i would probably buy one house however, normally speaking, between a hundred grand house and a 200 grand house, the rent on the 200 grand house is not going to be double as there is no direct correlation between the house price and the rent.
Normally, you will get a better return by leveraging your money and buying multiple houses but if the other was genuinely the same, I'd probably just buy one because having less tenants means less headaches.
Ben: Is it possible to succeed in property if i am shy?
Shy is a very interesting word and if you're introverted which just means that you're not massively into hanging out as an introvert is someone who gets energy from being alone because they like to be alone, and I believe they succeed in property too.
An extrovert is someone who gets energy from being around other people such as myself.
If by shy , you mean timid and scared, you're not going to succeed because shyness is almost, and again this might be controversial, but i almost see shyness as almost like a disease.
The first time i went into an estate agent's shop and told them i was looking for below market value deals, i was shy as my mouth was drying up and i couldn't get my words out because I've never done it before and so it's very normal to feel like that but you have to push through that.
Get out of your comfort zone because people that don't step out of their comfort zone aren't going to grow and aren't going to get different results.
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