Is Right To Buy A Good Strategy To Use? Q/A Session With Samuel Leeds!
Hey there, I’m Samuel Leeds! It’s another one of my Q/A sessions where I answer your questions on my YouTube video from last Sunday. If you also have a question related to property investing, head over to my YouTube channel and write it in the comments of my previous Q/A video.
And while you’re there, hit like and subscribe to my channel for more property investing information!
Let’s start with the Q/A now.
AlexanderPPG: Can you tell us what we can do after 18:00 when the agents don’t work? For example, how to get more leads in R2R, which websites to use for sending messages, build contracts and EXT that’ll be needed to start and grow a business.
Listen, if you go to estate agents for R2R and it doesn’t work, just keep doing it! The only reason people fail in anything is that when it doesn’t work right away, they quit.
Go to sparerooms.com, gumtree.com, etc. talk to more estate agents and keep persevering.
Ricotalion: I’m based in Scotland. Would you use local mortgage broker, tax accountant, etc. as Scotland has a divergent tax system? Or if investing across countries, use online brokers, solicitors, etc.?
Your question is about finding a local team (of solicitors, brokers, etc.) or an online one. I’d say have a little bit of both. I would highly recommend finding people who are near the property and who are investors themselves. Hope that helps!
Ryan Ellison: I’m looking at starting my investing soon. Could you quickly go over the process, such as registering the LTD company, creating a bank account for the company, finding a lender, etc.? Many thanks!
You know what, you can have a company, an accountant, a nice logo for your company, but none of that matters if you don’t start making money! I’d suggest finding deals first. Find a house first. When you start finding properties you want to buy, you’ll ask yourself: how do I get through with this? And if you need a company to get the house, it can be set up in 24 hours!
Therefore, focus on money-making activities first.
Red Rooster: This question is on behalf of many I’ve spoken with: I’m a single parent, currently reliant entirely on the state. I’m permanently semi-exhausted after caring for small children without any help. However, I’m smart, and willing to use my limited time smartly. What is an optimal strategy to first get extra income to pay for help with cleaning and shopping? To free up my time to move to stage 2, full financial freedom?
If you’re looking for some extra money, you may do well with a part-time job. For property investing, either you can become an investor, for which you’ll need money, or an entrepreneur, for which you’ll need time and a lot of effort. A part-time job would be suitable for you. If you already have one, you can go over to your employer and ask them how you could be more valuable to them.
Online Boss: In one video you said an HMO wouldn’t work in the area your house was in. Could you give me a macro description of which areas an HMO would work and areas it would not?
HMOs will work in areas where you can rent out rooms. These areas will be where there are jobs, there are train/bus stations, and there are PEOPLE. In case you’re in a council state where it takes a ten-minute drive to get to the nearest co-op; it won’t be good for HMOs.
Add The Support: what’s the first thing you need in terms of knowledge to start a buy-to-let business?
For buy-to-let, you need to know how to buy low, and calculate the return on investment by calculating the true value and true rent, divide the two to find the return on investment.
Daniel Alecu: Do you still organize crash courses? Are they still available online?
We are not running crash courses at the moment because of the government restrictions. However, you can avail of the online course for free if you’re a member of samuel365. Otherwise, you can have the course for 195 pounds. If you’d like to be a member of samuel365, you can pay a trial price of 1 pound.
Jagat Kharel: I have two buy-to-let houses. I want to know the difference between buy-to-let house to buy company name and person’s name. Also, if I don’t work, can I get a salary from my buy-to-let rent?
The difference between buying a property in a company’s name versus an individual’s name is exactly what the name suggests. If a person buys a property, it’ll be in their name. If the property is owned by a company, it’ll be in the company’s name. There are tax advantages of owning properties in a company’s name, though.
And of course you can get a salary through the rent if you’re making a profit.
Jade Wright: Do you need to have an HMO mortgage on an HMO property? If you have a BTL mortgage, can you rent it out as an HMO, or do you need to change the mortgage?
Listen, a mortgage is a mortgage. You may have restrictions on it given by the bank. So make sure that the loan terms clearly mention that you can’t put up the house as an HMO or a serviced accommodation and can only do so as a BTL.
Liam Barlow: If I use a strategy whereby I offer my investor a fixed return of 10% and use this money for deposits, is this payment to the investor tax deductible?
I don’t think I’ve understood your question well, please comment again!
Helping Hands: I’m pregnant, and going to have my first child in December, 2020. I have finally got on the council’s social housing list and intend to patiently bid until I’m offered a home in London. I then intend to use the right to buy to purchase it at a discounted rate once I become eligible to rent it out. Is this the long way of doing things? Am I hindering myself from pursuing other opportunities by going down this route?
Yes, Right to Buy is a good scheme. However, I wouldn’t move in the council house and wait for so long, because you need to rent it out for some years before you can buy it. Therefore, I wouldn’t suggest you moving into the council house because you would need a lot of time before you could rent it out.
Jess X: Could you talk about the pros and cons of Help to Buy schemes?
I think Help to Buy isn’t that great as compared to Right to Buy.
Help to Buy is when the government lends you money to buy a house you already live in, and it’s supposed to be a new bill, and you have to pay that money back. I don’t think it’s that great. On the other hand, in Right to Buy you can rent out the property, and it’s discounted as well. However, it always depends on what you want.
Peter Weaver: I’m currently doing a CEMAP course to try to jump into some sort of job role in the industry before I begin investing fully. Do I need one HMO, two BTL properties, or even two refinance deals a year? What is the average for someone like me to finally leave the 9 till 5 job?
That’s impossible to answer because it depends. You can leave your job tomorrow if you’re packaging and selling deals, making 2000-3000 pounds a month. I know one guy who is making 6000 pounds a month with just ONE deal! So it really depends.
Ouroboros: I live in a two-bedroom flat in Manchester, and have 60k pounds equity in it. I’m thinking about moving out. Letting it for 800 pounds/month and renting a cheaper flat to live in. I’d like to pull my money out to buy a second place to let, but don’t have a clue. I don’t understand the refinancing part. What do you mean by re-mortgaging the property in your videos? What are the steps?
A mortgage is just a loan against a collateral, which can be a property. If you already have equity in a property, you can go to an agent and say, “hey, I already own a house, can I get money against it?”
If you already have a mortgage on the house, you can get a bigger mortgage to pay off the previous mortgage. The difference you can keep, which is tax free! Hope that helps!
Wrapping Up
This was a great Q/A session! If you enjoy property investing content, head over to my YouTube channel and subscribe. Make sure to hit the notification icon so that you don’t miss any of my new videos.
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