If at first you don’t succeed, try, try, try again. That’s what Melvin Salas and Sofia Alpizar did after joining Samuel Leeds’ academy. The couple received more than 100 rejections before landing their first rent-to-serviced accommodation deal. Now they control 13 furnished, rental properties. Combined with some deal selling, their turnover amounts to around £250,000 a year. Melvin and Sofia have also launched a lucrative property staging service and are embarking on an ambitious development project in their native Costa Rica.
‘Our first deal gave us an infinite return’
It was in their home country that Melvin and Sofia pulled off their first property deal. They found a shop for sale which they thought was undervalued and negotiated to buy it at an even lower price, using a mortgage and a personal loan.
Then they rented it out to a tradesman selling and repairing mobile phones.
Effectively, it was a no money down deal because the rent covers their loan payments, leaving them with a small profit.
They got the idea after watching some of Samuel Leeds’ videos on YouTube.
“Even though the profit is not that high because the rent is not that high it has been completely like infinite return because we didn’t use any of our own money. It is very passive. The most we’ve had to do is change the aircon,” explains Sofia.
After that triumph, the pair turned their attention to the UK as that was where Melvin and Sofia spent most of their time, having moved here eight years ago. They had been following Samuel for a while and wanted to invest in a couple of buy-to-lets.
Sofia and Melvin bought it with a Government Help to Buy Equity Loan which meant they couldn’t buy a second property while there was still an outstanding debt on it. As a result, they waited a year before going to the course.
In fact, there were many strategies open to them which they could have used to get started as property investors, says Sofia.
“We lost time. If we had known all the strategies that Samuel teaches, we could have gone sooner and just done rent-to-rent and that would have been fine, for example.”
It was only when the fledgling investors had repaid the loan and planned to refinance their home to raise capital that they finally came along to the event. Afterwards Melvin and Sofia joined the Property Investors Academy which was to be the launchpad for their business.
‘Last month we got a £20,000 profit from the rent-to-SAs’
When Melvin and Sofia began their training, they thought about using the buy, refurbish, refinance, rent strategy to build their wealth. It seemed the obvious choice as Melvin is an architect and Sofia’s parents had built apartments in Costa Rica.
But then the couple realised they needed cash flow and so switched to trying to obtain a rent-to-rent deal, hoping to capitalise on the rising demand for serviced accommodation.
The strategy enables a property entrepreneur to rent a house or an apartment from a landlord and then to rent it out it at a higher rate under a company let arrangement. Typically, the investor furnishes the property and agrees to maintain it.
However, Sofia and Melvin struggled to persuade a landlord to hand over their property to them to manage.
“It was really hard. It took us two full months of calling, calling, calling, doing viewings and getting 100 plus rejections,” recalls Sofia who puts down their rocky start to being from another country.
“Getting used to everything here, like the culture and the way that businesses are structured, is very different from back home.”
Their task was made doubly hard because they were both working full time. That meant making their calls either late at night or at weekends.
Melvin owned a marketing company by this point but was to all intents and purposes an employee because he had created a job for himself, he says. Like Sofia, he was keen to make a go of earning a living from property to give himself more time.
Eventually their persistence paid off and they secured their first rent-to-serviced accommodation unit, but initially it lost money.
Their misery was compounded when they took part in a Monday night Mastermind Zoom call with Samuel Leeds and other students.
During the session one couple, who had joined the Property Investors Academy at about the same time as them, spoke about how they were already making almost £10,000 a month.
It was a wake-up call for Melvin and his partner. “[We realised] there are no excuses,” admits Melvin. “It’s like you could be there because you’ve got access to the same knowledge. Who’s to blame then? It’s us. We need to get better.”
So, they reviewed their charges and learnt about PriceLabs, a dynamic pricing tool which takes account of factors like seasonal trends to maximise revenue. It worked.
“PriceLabs was something we didn’t have, and we got a six months relocator just by being more proactive on OpenRent,” says Melvin, adding:
“We just needed to develop the skills and try, try, try until we got better.”
With a long-term booking in the bag from someone who was in between house moves, the duo felt confident to go in search of another deal.
Having a good relationship with the landlord of their first SA helped them to get five of the 13 properties which they went on to secure in Essex and the North East.
Sofia points out that not all of them came from this one landlord, but he referred his niece and a friend to their company, Riibon Properties.
They never expected to be turning over so much money when they started out. Melvin believes the key to attaining success is helping people.
“I’ve noticed the more value you give to others the more money you get back. When our rent-to-SAs were not doing that great we improved [them] and so we’re doing better.
“We listen to the landlord, and they will tell you what they need. That’s when we start talking. [We say] now we know what you need let’s talk about how we solve it.”
Sofia agrees with the philosophy behind this approach: “Giving a good service and adding value to the landlord is very important.”
The bulk of their annual turnover comes from the rent-to-SA portfolio, with their hard work finally starting to reap dividends in a big way in the summer of 2023.
“Last month we got a £20,000 profit from the rent-to-SAs. That’s when we realised all the effort was paying off,” says Melvin.
Sofia adds: “We’ve been reinvesting all the profits but that means that between all the four partners in the rent-to-rents the only cash we had to put in was £5,000 each. That’s how much we’ve put in for the 13 rent-to-rents.”
In addition to their rent-to-rent portfolio, Melvin and Sofia have also started a property staging business which is already proving a money-spinner.
“The turnover on that last month was £11,000,” says Sofia.
So far, the entrepreneurs have staged four HMOs in the North East, furnishing the properties and dressing them for the investors who have bought them to refurbish and rent out.
Staging a property is easy for Melvin as an architect, but it is not simple, he says.
“You need to be quick and cost effective. You need to think about the return on every item.”
Melvin and Sofia found out the hard way that bringing in flatpack furniture which then had to be put together was time-consuming. So now they have systemised their operation by linking up with a supplier who assembles it for them.
That gives them time to do the staging which makes it much easier. Most of their customers have come through one of their partners. Sofia says: “He helped us out in bringing the investors in and then we sell them the staging package.”
It was through the academy that they learnt about systemising. “We wouldn’t be able to do staging if we didn’t know how to systemise the rent-to-rents and vice versa. Also, we have more time each time to do other things. We won’t be trapped in just one thing,” Melvin says.
Apartments venture in Costa Rica promises huge rewards
At the Accelerated Coaching Performance programme, held over two days, Samuel Leeds spoke to his two students about diversifying. He warned them that as most of their income was from serviced accommodation, they could be affected if the rules or the market changed.
For that reason, Melvin and Sofia decided to go in a completely different direction by taking on a development in their homeland in Central America.
They are seeking planning permission to build four apartments on two plots of land in the capital, San José, using a creative joint venture. They will keep two of the flats and give the other two to the landowner.
“Each plot is worth around £60,000 and each apartment is going to cost about £80,000 to build,” Sofia says.
Melvin fills in the last bit of the equation: “And then at the end each apartment is going to be worth £150,000.”
They are taking out a bank loan and putting in about £100,000 themselves to fund the venture. Once the construction is finished, the plan then is to pull out their money by refinancing the flats to the new value.
Their target is to free up up time to return as often as they can to Costa Rica.
Sofia says: “We are in a rush to get to a place and that place is having the freedom not only in the passive income but also in time to be able to go as much as we can to Costa Rica.
“We want to be able to go there for three months, see our family, come back and not have to worry about a job.”
Melvin is conscious that scaling their business without overwhelming themselves is their next major challenge. They have the support of the Property Investors Academy community to guide them as they continue to work towards achieving their goal.
“It’s thanks to the academy we’ve got the success we have right now. It just gets exponential,” he says. “I remember going in to one of the first courses thinking everything is black and white in property. I came out saying everything is like great colours.
“It’s so creative. That’s what I learnt from the mentors and everyone on the academy. It opens your mind. That’s what’s so exciting. It’s like now you can do whatever you want. You mix this with that, lease options with SAs with BRRs. There are so many options.”
Melvin and Sofia’s tips
- Educate yourself even if you think you’re not ready for it. You can see all the free videos you like on YouTube, but you will never learn what you need to learn until you pay for proper education.
- People pay you for helping them. The more value you give to others the more money you get back.
Samuel Leeds Verdict
“With property there are so many different strategies. You’ve just got to figure out what’s best for you. The strategies we teach can be applied not just in the UK, but worldwide, as Melvin and Sofia have shown. They have also successfully diversified their business. Their story is inspiring.”