Podcast Summary
Starting a property portfolio from scratch with no money: Determination, persistence, and learning from others' experiences are crucial in building a successful property business, even without initial capital
Starting a property portfolio from scratch is possible even without significant initial capital. Saj Hussain, a business owner and entrepreneur with a multimillion-pound property portfolio, claims he started with no money. During a confronting interview on the Business Broadcast podcast, he revealed that he began investing in property around 15 years ago, starting in his late thirties. Although he wouldn't confirm being a millionaire, he acknowledged that his portfolio was worth millions. The conversation highlights the importance of determination and persistence in building a successful property business, as well as the value of learning from others' experiences, regardless of the sector.
High-end HMO investor shares strategy and success: Investing in high-end HMOs can lead to substantial monthly income, but it takes time and adaptability to build a successful portfolio. Keeping high cash flow properties and continuously trading, adding value, and selling can be effective strategies.
Property investing, specifically high-end HMOs (Houses in Multiple Occupation), has been a successful strategy for this individual, but it's important to remember that markets evolve and strategies must adapt. The speaker started investing around Birmingham due to affordability, and currently manages around 250 tenants across about 20 properties. They earn a significant monthly income, but it took close to a decade to build up a portfolio generating over £20,000 per month. Their approach involves keeping high cash flow properties while continuously trading, adding value, and selling. They've had some success with multi-lets, housing 5-6 people per property with en suites, spending approximately $120 per house. Despite their success, they advise against exact replication due to market changes. Their monthly rents range from £350 to £500.
From no money to £1,000,000 rent roll in 10 years: Starting small, understanding cash flow, and focusing on numbers can lead to significant wealth creation in real estate. Persistence, creativity, and a positive societal impact are essential.
Starting small and being resourceful can lead to significant wealth creation in real estate. The speaker shares his journey of starting with no money and building up a rent roll worth over £1,000,000 in 10 years. He emphasizes the importance of understanding cash flow and the significance of numbers in real estate. The speaker also highlights the importance of education and inspiring others through transparency about one's business journey. He encourages entrepreneurs and business owners to generate wealth that contributes positively to society. The speaker's first deal was structured as a joint venture, where he found a repossessed property and offered it to someone else, sharing the rent if the deal delivered the expected numbers. He did this to save the homeowner from losing their house and to ensure that the deal wouldn't go to waste. Overall, the speaker's story demonstrates the importance of persistence, creativity, and a focus on cash flow in real estate investing.
Finding value and partnering for investment in real estate: Effective strategies include rent to rent HMOs and buying properties outright. Ethical rent to rent involves leasing underperforming HMOs, while buying properties offers long-term income. Maintenance and improvements are essential to attract tenants.
Finding value and partnering with those who have the means to invest in it is a powerful strategy for real estate investing. However, the specific approach to implementing this strategy can vary greatly. Rent to rent, where one rents a property and converts it into a House in Multiple Occupation (HMO), can be effective if done ethically and legally. This involves leasing an existing HMO that is underperforming and has a commercial mortgage or is debt-free, rather than renting a residential property with the intent to turn it into an HMO, which is against most lenders' rules. The strategy of buying and owning properties outright is also a popular approach, with many investors holding onto properties for long-term income. Ultimately, the best strategy depends on the individual's resources and opportunities. Additionally, it's important to note that maintaining and improving properties to meet modern standards is crucial to attracting and retaining tenants.
Starting in property investment with rent-to-rent: Build a small portfolio, generate income, focus on value-add and property management, leverage private money, consider active and passive income streams.
Starting in property investment with rent-to-rent is a viable option for those willing to put in the time and effort. It allows for building a small portfolio and generating a solid income. However, it's essential to approach it as a letting agency business, focusing on value-add and property management, rather than solely for financial gains. Leveraging private money is also a strategy for growing a portfolio faster. Property investment involves both active and passive income streams, with the former providing quick returns but requiring more work and the latter providing steady, long-term income. The speaker shared their experience of managing properties and emphasized the importance of considering the business aspects of property investment. They also mentioned that they have developed up to 9 houses in a month.
Banks are not always loyal to their clients: During economic downturns, banks may call in good loans, leaving borrowers in a precarious position. Consider alternative lenders and having cash on hand.
The relationship between borrowers and lenders in real estate, particularly during economic downturns, can be unpredictable and potentially harmful. The speaker shares his past experiences of banks calling in good loans during the 2006-2007 period, which destroyed businesses. He emphasizes that banks are not necessarily loyal to their clients and that borrowers should not be overly reliant on them. Instead, the speaker has experience borrowing from private investors at varying interest rates, highlighting the importance of finding deals and having cash available. Additionally, the speaker notes that the current high real estate prices and demand have led to a surplus of cash among property investors, making it a seller's market. Ultimately, the speaker encourages potential investors to consider their motivations and goals before investing, as these will vary from person to person.
Historically good for long-term capital growth, but reasons for investing clear: Investing in UK residential property for long-term capital growth can be rewarding, but careful consideration required for high-yielding areas and smaller investment sums.
Residential property investing in the United Kingdom can be a good idea, but the reasons for investing should be clear. For those looking for long-term capital growth, investing in residential property has historically shown substantial returns. However, for those seeking a modest income, this may not be the best option. High-yielding properties can be found in areas where many people prefer not to invest, such as the northeast or the peripheries of other areas. These investments require careful consideration to ensure a decent return and capital growth. Additionally, the speaker suggests that investing in traditional property at the high-yielding end may be a better option for those with a smaller investment sum. It's important to remember that every investment comes with its own risks and potential rewards, and it's crucial to understand your personal financial goals before making a decision.
Selective tenanting and involvement in property management: Successful property management requires careful tenant selection and understanding the level of involvement needed for various investment types to minimize issues and maximize returns.
Being selective with tenants and understanding the level of involvement required for different types of investments are crucial aspects of successful property management. The speaker emphasizes the importance of careful tenant selection to minimize issues and maintain good property management. Additionally, high returns often come with higher problems, as seen in their experience with service accommodation units which require more hands-on management and resemble a trading business rather than an investment. Regarding interest rates, the speaker acknowledges the historically low rates and the uncertainty around future increases, but believes they will likely remain low for at least a few more years. The government's intervention in the market has also influenced the current state of the property market, and any potential crash may not be as severe as initially anticipated.
Balancing transparency and privacy in property investing YouTube content: Maintain a balance between sharing business strategies and experiences, and protecting personal life details in YouTube content for property investing.
While being transparent and open in a business like property investing on YouTube is important, it's also crucial to maintain a level of privacy and not share every detail of your personal life. Saj has done an excellent job balancing these aspects, making his content informative and engaging for viewers. Remember, it's a business, and while sharing strategies and experiences can help others, there's no need to reveal everything. So, be open, but also protective of your personal life. Check out Saj's YouTube channel for more insights into various property strategies.
