How To Get Started With Property Investment—Q/A With Samuel Leeds
Every week, I gather all of your questions regarding property investment and try to answer all of them. I've been in this industry for over a decade, have a massive portfolio of properties, and have written a best-selling book on property investment. I enjoy answering your questions thoroughly and love helping you guys out.
So, without further ado, let’s get started!
Q: I hope you don't mind me replying to a few of the questions. I just turned 19, have a buy-to-let on a council scheme emergency accommodation, 40k raring to go. I intend to use the BRRR strategy, but if you want to film a series of financial freedom challenge flipping properties, I'd love to be considered.
That's amazing! I don't know if there was a question there, per se, but I would love to meet you in person. No promises, though, but feel free to hit me up on social media!
Q: What did you do differently than everyone else in the industry to become a millionaire, while others are still not?
I wanted to invest in properties, so I bought a property, refinanced it the same day, put it in my step dad's name because I was too young to get a mortgage. I slowly started doing other property strategies, such as lease property agreement, I was managing properties, and that's how I became financially free. I became a millionaire through deal sourcing. When I became financially free, I wanted to buy more properties, so I ended up doing deal sourcing and passed some great deals onto investors. From the fee, I kept building my portfolio. Over time, I refinanced my properties, and that's how I became a millionaire at 25. I believe you need to work ridiculously hard to be a millionaire; maybe it's not for everybody. However, I do believe that everybody can become financially free.
Q: for my four-bed HMO that I already own in Northampton, I purchased the HMO with planning permission already granted, which runs out in March 2021. I have permission to make the kitchen bigger, as well as a 5th bedroom. Do you think I should go for the extension or put the money in a deposit for another home?
It all comes down to the ROI. See how much the extension of the kitchen and the 5th room is going to give you in return for your investment. Obviously, you're going to get a much bigger rent on that. However, my gut feeling is for you to put the deposit for your second home. It's going to give you two sets of incomes, two sets of capital appreciation, etc. Do the figures, and see which will give you a better return. Good luck!
Q: Can you tell me when your crash course is going to open, as I still have a ticket from when I purchased your book?
Listen, as much as I love doing YouTube; I love conducting live events! I'm just as itching as you are to start the event. As soon as the government allows it, I'm going to get back to it! Hope to see you soon at my training!
Q: Do you need C3 permission for R2SA?
No, you don't need C3 permission unless the council requires it. There are exceptions, such as in Greater London, you do need it. My suggestion is to ask them if you need C3 for a short stay-to-let. They're going to let you know. However, I wouldn't bother doing SA in an area that asks for planning permission on a property you don't even own.
Q: What happens when house prices get down, and tenants can't pay the bills due to lack of jobs?
Let’s address the two points mentioned here:
You talked about house prices going down. Listen, if you’re getting rent out of that property, you won’t have to worry about the prices going down, you’re going to take the rent as usual. And, property prices go up and down, and it’s not a problem unless you’re selling it. But, as long as your property is an asset, and it’s bringing you cash flow, it doesn’t matter.
The next thing you talked about was tenants not paying bills due to a lack of jobs. I don't think that is going to happen. However, statistically and historically, whenever there has been a recession, rents have gone up. So, I believe you need to be a little more optimistic!
Q: First of all, thank you so much for doing this! I have two questions in regard to buying the first property. Would you recommend using a bridging loan for a deposit? And as a first-time buyer, would a mortgage be easier to attain?
I'm very happy you're spending time educating yourself. I'd be very careful getting a bridging loan for a deposit, especially when you don't know much about it. Bridging loans are supposed to bridge the gap between purchase and mortgage, and they're for six to twelve months max.
The only time you should use a bridging loan is when you're buying the property in cash, and you use the loan to buy it with the view to refinance it once you've lifted the value of the property. I advise you to get in touch with a mortgage broker to ask if you're eligible for the loan. Keep educating yourself, and if you have any more questions, let me know!
Q: I just bought my first property under market value at 159k, spent 14k on renovations, and got help from trade people in the family. Five months later, it is valued at 195k. Not a huge profit, but given I have no prior experience, I'm happy. Keep up the great content, and keep inspiring others as you have inspired me!
That’s so cool! That’s like a twenty-two thousand profit, or something there. Really happy for you!
Q: What would you do when you are a deal sourcer and have found an amazing property lead, but the estate agent tells you to view it but can't because of the pandemic?
You can go out and view properties by keeping social distance and wearing a mask. People are still viewing properties, and I would recommend you to not miss any opportunities!
Q: Thanks for the free content, keep up the great work. I set up a limited company last September and pursued an investor to come on board. Currently on my 10th property deal, which is largely off the back of your videos—a mix of BRRR and standard BTL. On average percentage-wise, how much value will adding an extra bedroom to property create?
Firstly, massive respect! It’s quite different now to read comments like these as compared to the beginning of my YouTube channel. I would get questions like what a BRRR was, what an HMO was, and now people are on their 10th deal, on their 5th HMO; it’s honestly amazing!
About your question, it depends on the house. I would suggest you talk to an estate agent and ask them how much it would give you on average because rents may differ due to the area. You may compare the price you get from a two-room HMO to a three-room HMO to find out the difference in the area. Good luck!
Q: Can you use money from a remortgage as a deposit on a BTL mortgage?
Yes, you can! If you refinance a house, you can use that money for whatever reason you want, and I would certainly use it for the BTL mortgage.
Q: Haha, you're right about what you said about me, Samuel! I have a well-paid job, which I hope to give up to concentrate on my property business because I think I am now financially free. Respect for what you teach!
I remember you from last time! I had predicted your life by your comment. I would love to have you over at my Winners on a Wednesday show! You can apply by logging on to winnersonawednesday.com, share your story with me, and I would love to have you over.
A Final Word
I love answering your questions and reading your comments. If you have any questions you would like for me to answer, just log onto my YouTube channel and leave your questions in the comments. I will do my best to answer them next week.
For more videos on property investments, subscribe to my YouTube channel.
If you want me to mentor you one-on-one, visit samuel365.com!
🎥 How to build a property portfolio from scratch in 7 DAYS: https://youtu.be/RWEkj1y8XKs
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