Hi everyone, it’s Liam Ryan one of the Co-Founders of Assets For Life.
These videos are for people who would like to learn about property development and investing in order to become financially free, by creating a leveraged business. Today I’m going to share with you a brief story of our property journey, and most importantly I’m going to share the 7 Step Property Freedom Formula to achieving massive results such as getting your first property deal over the line.
We have just finished building seven flats and two houses. You may notice the property behind me, which is actually my first ever land development deal. Here’s some pictures of before project completion on Priory Street, Colchester (hover over pictures to scroll through):
And after project completion:
We’ve now got number of deals that we’re working on. One of those is just around the corner, which is a commercial conversion where we are converting an old office into 16 flats.
If we can do this, then we are confident that you can definitely do it as well. I hope that this video will help you achieve your goals in property.
If I take you back a couple of years ago, I had never done a development of this size. I’ve been in a property as an amateur whilst I travelled the world, and at the time I was a part-time investor. The reality is I had done everything that you shouldn’t do. Why? Because I didn’t have the education and I wasn’t part of high level mastermind or mastermind program.
Also, I got sold on glossy brochures, off plans, new builds, and apartments on golf courses. I invested heavily into a property portfolio in Spain, then I lost over half of my money when I came to sell the units in 2013-2014.
I must say, my first experience in property wasn’t that positive. But I look what I’ve done and learned from it. I moved back to the UK in April 2014. I knew in that moment that I wanted to get into property but I just didn’t quite know how to start. That’s also the time I met my business partner who’s now my Co-Founder at Assets for Life, Jay Munoz.
He’s a chartered civil engineer and he’d been in property for many years. He’d worked on a big project development with Alan Sugar as a top project manager for ISG and Skanska (a leading project development and construction group), he also worked for Heron Tower (one of the tallest buildings in the City of London) and Walbrook. These are 250 million pound builds.
Jay and I joined forces. I had many years in business while Jay had many years in property, so we came together and we created Assets For Life.
Now, Let’s talk about the 7 Step Property Freedom Formula.
1 – Mindset
Step 1 is Mindset – this is the most important step by far.
At the beginning, I didn’t have the right mindset but I started to believe in myself and believe that I can do everything. You can read all the books you want to, but if you don’t believe in yourself and don’t have the right mindset to take action then you’re gonna stay stuck and maybe that’s the position you’re in at the moment.
Maybe you’ve got all these dreams, desires, wants, needs, and you’re in the same position now as you were a year ago. So I want you to break through your blocks and barriers and develop your mindset.
You may also ask “what if I have a negative mindset?” Or “how do I overcome a negative mindset?”
I myself experienced that as well as feeling doubtful about taking the right steps to get results. Our Co-Founder at Assets For Life, Jay Munoz, has his mindset in the right place, while I was thinking inside “can I really do this, can I really become a developer?”
I didn’t really know what I was doing, but over a period of days, weeks and months we got the education, we started to implement and all of a sudden I was like “you know what Jay let’s go for it!” So, when Jay found this development we started the process.
As I’ve said earlier you have to believe in yourself. Don’t let negative chatter or situations get you down. Surround yourself with like-minded people, go and find high level mentorship or mastermind groups just like what we offer at Assets For Life.
Go and hang around with successful and positive people. Talk to them, be open, ask them lots of questions that you want to know the answer to.
Want to find out more about our property training events? Grab your ticket for our next event for free:
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INVESTING in “YOU” is your BIGGEST asset.
That’s exactly what Jay and I did in 2015. We got the right education, invested heavily with amazing mentors in property and that’s where we gained our confidence and the belief to believe that we CAN do something like this. Fast forward to where we are now, and we’ve just completed this development of seven flats and two houses. We’ve sold seven units now, we’ve got two more units to sell and we’ve got whole bunch of viewings over the weekend.
It’s really important to be the best version of yourself that you can possibly be. Have a positive mindset. Push yourself as best as you can on a day to day basis. Start reading books, go to networking events.
Surround yourself with like-minded people and then make an absolute pledge that you’re gonna do your first land development deal over the course of the next twelve months. Once you make that pledge, keep yourself accountable to some high level mentors and be part of a high level mastermind group. You definitely gain so much confidence in your mindset and business skills by being part of one.
Now I want you to do this exercise with me. This was given to me by my mentor and it absolutely changed everything for me. Write a list of 50 great things about you and your business that you can put on your phone or in the office have it as your desktop screensaver. Whenever you feel beat up, deflated, feel like you can’t carry on or you’re not feeling great about yourself. You can always see or refer back to your list and that will enable you to put your best foot forward.
It’s always great to inspire people but don’t put yourself down nor compare yourself to where other people are. Always remember, you are exactly were you need to be at this precise time for a reason.
Hopefully I was able to educate and inspire you to continue your journey. On the next video we will talk about the second stage of 7 Step Property Freedom Formula. See you there!
2 – Funding
Funding is where you don’t have to use your own money in order to become a property developer. Instead, you can use Joint Ventures also known as JV Partnerships to raise capital. Raising Joint Venture finance has changed everything for us at Assets For Life, and we now do a lot of deals using none of our own money. If we can raise Joint Venture finance then you can definitely raise it as well.
If money is an issue, if you’ve got no cash or if your cash is tied up in an existing portfolio, that’s not an excuse not to go and do developments and start building your own multi-million pound portfolio. You’ve just got to learn how and this video will show you exactly how.
Also, in these video we’re going to talk about:
✓ Joint Ventures
✓ How we raised money for potential deals
✓ How you can raise money for your future developments without using your own money!
Alright, let’s begin!
What is Funding?
– One of the most important elements of the Property Freedom Formula as well.
– You will not use your own money. Instead we use Joint Venture partnerships.
Now, What is a Joint Venture?
✓ A Joint Venture is where we work with investors. They will typically invest the money into the project and we go and do the work and then it became a no money for us. Our first JV Partnership was a guy called Dave from Basildon and he invested £5000 on a loan agreement for one of our multi let refurbs. Since then we’ve gone on to raise over £3 Million in Joint Venture Finance. If we can do this then YOU can definitely do this.
✓ There’s a a couple of ways which you can structure your JV deals. There’s many ways actually, but the two that we typically used are the following:
✓ Where an investor will loan you money – we’ve got a product known as Assets For Life Savings Accelerator. The investor might loan you let’s say £200,000, you then do loan agreement and then you will agree to give that investor a fix rate return, let’s just say 10% per annum, and you’ve got the loan agreement for say 1-2 or 5 years.
✓ By giving an investor equity stake in the business. NOTE: You can only do this to high net worth and sophisticated investors and you do have to look up the FCA rules and regulation 13/3 to make sure you’re doing everything through the FCA guidelines.
Some high net worth and sophisticated net worth individuals want a bigger piece of the pie, and they’re not really happy with an 8 or 10 percent return. So, in this scenario what we will do is we will set-up an SPV (Special Purpose Vehicle) limited company with the investor, they would become a 50% shareholder. Then we as the developer would be a 50% shareholder, they invest the money we go do all the work and then when we sell the development. We pay the investor their initial capital back plus (in this case) it could be a 50% share of any profits.
How did we raise the money for a deal?
✓ We found a Joint Venture partner, they put in what’s called an equity part of the deal. We bought the land for £305,000 with legal and we used Investor funds for that.
✓ We went out to a development funding company known as Funding Circle. They lent us money needed for the development. Construction cost and professional fees are covered by Funding Circle. We then became the developer, we set up an SPV with the investor and then we give the investor a profit share when we sell the unit.
Funding Circle are getting stricter with who they lend to and at present are not as viable for these kinds of projects, however if you do some research you can find some smaller but still reputable development funding companies.
How do you raise money for your future developments without using your own?
✓ Work on your branding and make it clear exactly who you are as a company or brand, and the investment product(s) that you offer out to your investors. Also, It’s really important to develop your 60-second elevator pitch so when you go networking you feel confident in what you do and how you can help.
✓ It’s also really important to be seen and to be heard. You can do that by attending any networking events such as business networking events or charity events. Go and put yourself out there and surround yourself with people who also want to get into property or they want to get their money working for them.
✓ Get yourself at least one networking event per week. Go and introduce yourself to five people and book in a minimum of 2 coffees per week.
3 – Site Finding
Now we are going to talk about step 3, which is all to do with site finding in the 7-Step Property Freedom Formula. Just to quick recap on our previous video, we talked about mindset and funding – you can now see how the whole system starts to fit together. You’ve got have the right mindset and make the decision that you can go and become a developer. Then, of course you’ve got to look at funding.
Now remember, you don’t need to use your own money in order to become a property millionaire and in order to build multi million pound property business. Instead you can use Joint Venture finance, once you’ve then found money the other key result is ultimately going and finding deals. Finding money and finding deals really work hand in hand and you have to make sure that you’ve got a really good deal flow and you’ve also got flow of money coming from investors.
How do you go and find the right type of deals?
✓ Now the good news is there is so much opportunity out there at the moment, you just have to think about where you live at the moment. Think about all the property in your area, all of the commercial buildings in your area, all of those pieces of land, all of the developments that have been going on, there is just so much opportunity available. What you’ve been doing up until now is you’ve been driving a big pot of cash because you don’t know what you don’t know.
✓ So, how do you go and find deals? For example, the way that we found this particular site where we’ve just finished building several flats in two houses is by my wonderful business partner Jay Muñoz, being on his bike! He does this on a regular basis and he will just ride around our local area where we work with property investors and he will look for opportunities.
He was riding his bike back in 2015 and he came across this piece of land and there’s residential unit all around it and he thought there’s opportunity here.
So, we went on to Land Registry he paid 3 pounds and he found out who the owner was, he made the approach to the owner and the owner marked this piece of land for sale with a private sourcer. We make contact with the sourcer we started to build up the relationship, we went out for lunch and there was another offer on the table, we came in above that offer and our offer was accepted.
✓ How else will you go and find deals? One way which you can find deals is through your local state agents, land agents and commercial agents. How do you do this? Go and search in Google ‘commercial land agents in Colchester’ for example, and it will bring up whole list of agents selling land or selling commercial units.
You then create spreadsheet and you put the information in there, and then a top tip from us is to get in your car, go down to your local area and you walk in to each of those places and you go and introduce yourself.
✓ Now when you go and introduce yourself it’s really important that you have your story together. Who you are, what you do and what you’re looking for, and ultimately that will give you a lot more credibility when walking into agents.
✓ Now you might not get the response that you’re looking for but don’t give up. No one said that building a property business is always a success, there will bumps in the road, you’re gonna have some challenges and like all of these things it’s really important that we moved through these challenges, and by doing so you’re going to build your confidence. Also you’re gonna get known by the agents relatively quickly.
It’s really important to build trust, you’ve got to be likeable, you’ve got to be credible with agents and one way of doing that is by getting yourself out on plenty of viewings. You can also go direct to vendor. It’s really good looking at your local area to determine what’s available.
Remember think outside the box as there’s a lot of opportunities out there for development. Thanks and stay tuned for more updates. On the next video we’re going to talk about the 4th step in the 7 step Property Freedom Formula.
More details on our free to attend property training event, The Property Mastery Summit where you can discover the keys to becoming financially free through property:
>>> www.ThePropertyMasterySummit.com <<<
4 – Appraisal
So now we’re going to talk the 4th step in 7 Step Property Freedom Formula which is the appraisal part of the Formula.
In this video we’re going to talk about:
✓ Appraisals – how they actually work
✓ Using a spreadsheet created by my co-founder Jay Munoz
✓ Metrics of the investments
✓ Return on investments
✓ Return on cash employed
✓ Build cost
✓ How do you work out your profit
Just a quick recap. You’ve decided that you’re going to do a land development deal and you have the right education, your mindset has changed, you’ve built up your confidence and you’ve made that decision that this is what you’re going to do. You then raise Joint Venture finance and you found some inventors that want to put in the money, and you do all the work so you can do a no money down deal.
You then build up your relationship with your local agents and you found a deal that you believe stacks. Now, how do you know if the deal will stack or not? Well, you do by using something like our big money formula which is a very simple spreadsheet created by my business partner co-founder Jay Munoz. Now some of the metrics that your investor would need to know are the following:
Return on Investments – Is a measure used to estimate and evaluate the performance of the investment, or to compare the performance of a number of different investments. To calculate the return on investment you take the income or the profit and you divide this by the amount of money invested and this is expressed as return on investment as a percentage.
Example: If the net rental income is let’s just say £12,000 but the purchase of that property costs are £250,000 then the net return on investment would be in this case 4.8%. Now, in order to purchase that you may not need to put in £250,000 for example, you may just need to put in let’s say £75,000 for the mortgage and just to cover some refurb costs.
Return on Cash Employed – For example: let’s just say the net rental income is £12,000 and your investor has invested £75,000 then the return on cash employed would be 16%.
What happens when you do development and you start building a property portfolio? You’re going to keep assets in the portfolio when you finish the development and you refinance. Then the idea is you get the initial investment paid back to you or your investor.
In some cases you might pull out all of the money and in some cases the investor might need some money on the deal and you’re going to explain to the investor what is the return of capital left in, again let’s just say that the net rental income is £12,000 you’ve refinanced the property and you’ve got a half majority of the money, and let’s just say there’s £20,000 left in the deal then the return money or capital left in would be £12,000 divided by £20,000 and that would give you return on capital left in at 60% return on investment.
Also, there’s some metrics that you need to know and present to your investor when you start moving into doing bigger developments like the land developments to work out HOW much the projects are going to make for you and what the costs involve. Here’s some of the numbers you need to know to start with:
1st thing that you need to know is:
What is your build cost, whether it’s ( pounds/ sq m or pounds / sq ft ) How are you going to find that build cost out. For this you need to speak to Quantity Surveying Consultants or QSC and some main contractors and you will get an idea of what their build cost is (pounds/ sq m or pounds / sq ft.)
What can you sell the units for and also you need to know your selling price (pounds / sq m or pounds / sq ft ) How do you find this out? We knew that we will be building seven (7) flats in two (2) houses, at the start of this journey we went and looked on Rightmove and we got comparables based on sold prices of similar buildings. We also went out to five (5) local agents and we asked them what stuff was selling for and what they believed we could sell the unit for and then we got a price for price per sq m on the selling cost.
Once you know what you can build it at and what you can sell it for, that will give you balance and that balance is made up of your purchase price and your profit. How do you work out your profit? Typically as a developer we will make 25% profit margin on the Gross Development Value or GDV.
For example, the GDV of the seven flats in two houses is £2 million we’re gonna be wanting at least half a million pounds profit. In some cases we will come down to 20% of GDV but if it’s anything come down 20% our top tip is to walk away from the deal, because stuff can come up and you don’t want to be in the position where you’re losing money or you’re not making that much money at all. There are plenty more deals out there!
Now, once you know your profit, what you’re selling for, your build cost that will then give you an indication of what you can actually buy the site for in order to make money. Once you then know that it will enables you to put in the correct offer. Some offers you’ll win, some offers you’ll lose, always refer to your deal analysis sheet or system because the numbers won’t lie. Other things to be aware of are your professional fees and these are made up of your project manager, architect, structure engineer, solicitor fees and typically your professional fees come in an about 10% of the build cost.
So, if the build cost is half a million, your professional fees will be in a region of about £50,000 and remember you can do this using none of your own money. We’ve been able to build £7.1million property portfolio over the last 2 years and the majority of that is using investor funds. If we can do it, YOU can definitely do it. Once you know how to analyse one deal, you just repeat that process and then you can go analyse another 40 or 50 deals and what’s also good is that you will be able to get the numbers for your particular area.
5 – Planning
We are now moving on to 5th step of 7 Step Property Freedom Formula and today we will talk about planning. This is the really important part of the formula because you’re now at a point where you have found the deal, you’ve raised money and you’re moving forward, the deal stacks up and you will be surprised how easily you are moving ahead with these deals.
In planning it’s also important that you have an amazing power team within your network that will help you so you can do less, earn more and then you can focus on your highest key result areas which maybe finding more deals or finding more money.
Remember that in property you don’t have to do everything yourself. There’s a whole bunch of amazing professionals out there who can do some of the work for you.
Who do you need in your power team?
(1) It’s really important you’ve got a great solicitor who has experience in land development or commercial conversions
(2) It’s also important that you’ve got a great broker that can give you access to commercial and development funding
(3) It’s important that you are using a great architect who can maximize the floor space available and can give you best design possible so you can increase the number of units and maximize on your GDV
(4) You also need a really good planning consultant – someone that can work with the local planning office because they know what to do and what things to say
(5) You also need have a really good estate agent onboard if you’re selling the unit, you need to make sure that you’ve got the right insurance in place and make sure you’ve got a really good insurance broker.
You can now start to see how all of these professional people are going to put a lot of puzzle pieces together. As a developer you have to make sure to keep everyone motivated and make sure that everyone is doing their work correctly.
What’s also important in the planning step is:
– To make sure you’re up to speed with all of the regulations what you CAN and what you CAN’T do. If you’re doing commercial conversion perhaps you’re going to use prior approval for this which is a planning sanction that was introduced a number of years ago.
– It’s also important to know if you’re going to be hit with any community infrastructure levies or section 106 fees, and again your planning consultant will help you out with this.
– To have a program of what’s needed and when it’s needed. We have a system that we are using in our business that you can also use for your business it’s called Trello and Asana which are online platforms where you can create checklists, processes and procedures, can give out tasks to your power team so everyone in your power team knows exactly what they need to do and when they need to do it. As a developer it’s your responsibility to make sure that people are getting the job done.
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One of the things that I love about doing bigger deals like land developments, commercial conversations is that once you have your team and your systems and processes in place you actually do less and you earn lot of money. So, how does making £300,000, £400,000, or £500,000 per deal all sound to you?
How does the idea of doing less and earning more as well. For those people that follow our Property Freedom Formula they achieve and you will achieve fantastic results, it’s just the case of learning the system and then applying it to your own business and financial freedom is literally just around the corner. You are just one deal away from having something life beyond your wildest dreams.
This is why we’re passionate about, this is why we love doing bigger deals such as land developments and commercial conversions and one of my key areas is to ensure that we are raising more money so we can do more deals and then ultimately scale and systematise the business.
So planning your development is important, having the right team in place is very important. You don’t have to be good at everything, I’m certainly not good at many things as well I just focus on the things that I am good at which enable our business to grow year on year out. Hope you found this step useful which is planning.
Remember if WE CAN DO IT, YOU CAN DO IT!
6 – Construction
You’re starting to understand now how following a simple system such as the Property Freedom Formula is really effective, and actually you can all go and become property investors and developers and you can do it using none of your own money, and you can do it doing less than more.
What I want to talk about is step 6 which is the CONSTRUCTION phrase. Now, one of the blocks that I had before I became a developer is seriously I don’t even know how to change a plug! My partner Holly she does all that stuff in the house, I’m really not technically minded at all and give me a screwdriver and I start to shake and panic and all sorts of stuff happens to me. What I realized is that you don’t have to be good at that stuff in order to go and build houses. I’m now standing in one of our latest land development where we’re building seven flats in 2 houses, we’ve just recently completed the scheme which has been amazing and the key thing when looking at step 6 which is all about construction is making sure that you have got a really good project manager and you’ve got a really good main contractor.
Now, as you go up the scale the quality of the professional that you’re going to be paying ultimately goes higher and higher. You’re not dealing with Bob the Builder any more, you are dealing with proper professional people that have done schemes like this for many years. How do you go and find the right contractor? Well, you look in your local area and you go out to say ten main contractors you pick the phone, you introduce yourself and then you go and have meetings with them you look at their past experiences, you get them to give you some indication on ultimately what the scheme is going to cost.
In order to do that you will need constructions drawings from your architect, you get those in Step 5 in planning and then you can go out to tender and you can take your drawings out to three or five main contractors and they will then quote and give you a price to do the work. When you’re dealing with construction you have to make sure that you get a fixed price contract, so you get a fixed price contract whereby you just know how much it’s going to cost you to do the scheme and that gives you and your investor certainty and peace of mind.
Then, what’s really important is that you have a regular site meetings so during this scheme we had our progress meetings every four weeks, where me and Jay and sometimes our investor would come down to site and we make sure that everything is on track and everything is moving ahead of schedule. We have what’s called a Schedule of Works so we know exactly what’s going on.
Having a good relationship with your contractor is really important and having regular site meetings is too, just to make sure that everyone is doing their job when they are meant to do them. So we’ve now got a great power team, we’ve got a brilliant main contractor and as you start to do bigger schemes you might then want to bring in a project manager that’s going to be the link between you and your main contractor. Don’t think because you’ve never done a build before that you can’t do this stuff, you’ve just got to come and spend time with the right people, get the right help support mentorship and make that decision that this is what you want to do.
Jay Munoz now will also talk about step 6 which is CONSTRUCTION in 7 steps Property Freedom Formula. Jay is also one of the Co-Founders of Assets For Life also known or called by Liam Ryan as ‘The Numbers Guy’. He’s also the one who finds the deals and is dealing with the main contractors and all of the techie stuff.
What was the process in order to find our main contractor?
Basically for Priory Street, we had a list of contractors that we got from a Quantity Surveyor (QS), we went to local QS as this was the best thing to do. There’s a list of five (5) contractors who can do the job and then what we did is we decided to go and see them all. So, we went to see the managing directors of the companies and we just basically found out information about the previous projects, what sort of level they were at or turnover they have, any of the challenges that they faced and overcame.
Then what we decided to do for this particular project was working a win-win basis and we decided to go with one contractor that we liked and we said “we haven’t got the construction drawings yet, but what we’d like to do is work with you right from the beginning’ because ideally what you need to have is all the construction drawings first if possible.
So, initially he gave us a rough idea of what the construction costing going to be, then we got the construction drawings from our architect, then we gave the construction drawings to the main contractor and the main contractor obviously gave us our price.
Just to break it down, when we decided to go with them our strategy was to sell it because we know, also I had several years of experience as a main contractors myself working big schemes. So what we decided to do was to say the main contractor that we’re only going ahead with this if we are able to use subcontractors. So that’s the outside the box that we came up with. This is an open book agreement.
DIFFERENT TYPES OF AGREEMENTS YOU CAN HAVE WITH YOUR MAIN CONTRACTORS
Obviously you’ve got a standard lump sum. What is standard lump sum? Standard lump sum is you’re giving the construction drawings and it finds all the trades, all the subcontractors, all the premium profit to the job. And you kind of done have to say or what subcontractors your point, but for this one it was a little bit different. We as a client will bring any subcontractors to the table with price for them.
So, again that’s really good because we knew that this scheme was going to be tight on numbers and with Jay’s experience that gave us flexibility with any of the packages, because with any constructions you have different packages and with bigger packages, then it meant that we could go out to our own subcontractors and try and get a better price, and we’ve done that for a number of packages.
Just to give you an idea when we did all the packages, we obviously wanted to pick the ones that had the highest value, we knew for a fact that the ground works was going to be one of them, so to give you an idea for the piling package the contractor brought subcontractors to the table that went over hundred grand the cheapest I think is 97 k.
My subcontractor previously used in my previous projects, one was eighteen thousand pounds but unfortunately we couldn’t use that method of construction because site access, so we have to go to the next one up which was about £27 k but you can see the difference, you save about one more £70 k all in one package because we choose that procurement strategy.
So there are some more top tips on how to find your main contractor and there is some insight into some of the different packages that you can do with your main contractor, depending on what works for you and what works for them.
We wanted flexibility on this latest land development deal it worked for us at the time. As we go into bigger deals, then we might do an all lump sum package or design and build package where we literally just hand everything over to the main contractor let them get on with it, but in this particular case we wanted to have some say along the way and that’s really helped us. So make sure you’re getting with the right people, spend time going out to main contractors, don’t rush and then work with your main contractor on a weekly monthly basis to oversee the project.
7 – The Exit
We’re now at step 7 which is all to do with the exits. Now, when you get involved with doing bigger deals it’s really important to have multiple exits in place, it also depends on what your investor is looking for as well. When we first completed on this land development build, the idea was we were going to refinance at end of the scheme then pay back the investor and then hold the units and then rent them out as multi let or service accommodation.
During the scheme the investor didn’t want to hold anymore, so you know we work with the investor and the investor wanted us to sell the units and the investor wanted to then not lock in the initial investment but the investor wanted to make some money and pull some money out of the deal.
Having multiple exits is really important, so we are now selling these nine units. So when it comes to the exit, it’s really important that you sell the units as quickly as you can. We actually started to sell these off plan, we’ve now sold seven out of nine units. We’re using Connells which is a very good local one or they’re nationwide but they’re based here in Colchester. So, we’ve got a really good relationship with the agent.
It’s really important that you create really nice brochures that potential buyers can read through. It’s also really important that you are managing the estate agent to make sure they’re doing everything they possibly can. The estate agent we’re using we paying them 1.5 % of the purchase price, we could have negotiated that down to maybe 1% but we want to create a win-win and we want to make sure that they’re going to sell the unit as quickly as possible.
And, then what’s really important is to create a show flat over show home – I’m currently standing in one of the bedrooms and we do everything to a really high boutique standard, we are very fortunate that our wonderful personal assistant Alexis is actually an interior designer. She designed all of this for us, if we didn’t have Alexis that we could go out to or we would find an interior designer to help us create that very special look.
As you can see this is one of the bedrooms here for one of the houses and we’ll just walk-in through here now, this is the master bedroom and you can see here as well it looks really nice, it’s all been done to a really nice standard and then of course other things that can help you exit is a scheme we’re using called Help To Buy.
This is a government scheme, which is helping people get their first property they only need to put down 5% for the deposit so that’s really good and we’ve reached our allocation now on Help To Buy and all the help to buy units have been sold.
Also, it’s really important to have a good solicitor that’s going to work fast and going to be proactive. We pay our solicitor £750 per unit. Now, a top tip for you when working with your solicitors do not pay an hourly rate because your bill will go through the roof.
Secure and negotiate a price per unit, we paid an additional hundred pounds if it’s Help To Buy because there’s a lot more paper work involved and that way we know exactly where we stand. So having marketing is really important, having good solicitor is important; having Help To Buy is an absolute must because it’s going to help you sell the units a lot quicker.
We’d also done a deal with one of the houses I think it’s the one that I’m standing in now, where to get the sale we agreed to cover the stamp duty of the property. So there’s things that you can do to try and get sales over the line a lot quicker because remember the quicker you sell, the quicker the money will coming into the bank account.
You can then pay back the development funders, you can then pay back the investor, and then you’re going to be left a big pot of cash that you can then split between you and the Joint Venture Partner.
The profit on this deal is going to be in the region of about £350,000 – £400,000. When we first started the scheme we were looking at about half a million pound profit but we’ve had some issues on the scheme, not everything always goes according to plan but I’m sure you would be happy with £350,000 – £400,000 profit on a scheme that’s only taken 52 weeks to build and imagine what that’s going to do for you and your family.
Now that £400,000 is not all of our money, we need to obviously share that with an investor but then if I look at return on time employed, I’ve only been on site maybe once a month for the last year I’ve not had major involvement, we’ve had power team doing all the work for us.
So, actually if you look at return on time employed my hourly rate for example, this goes into the thousands and thousands and thousands of pounds and what we will now do is we’ll use this profits to re-invest into other deals. Ultimately we’ll continue to build an asset-backed business where possible we always like to keep stuff, in this situation we are selling and that was simply a decision made by the investor but it means we sell the units.
So, that has now brought us to the end of this blog. I’ve really hope that you’ve enjoyed the videos talking you through our 7 Step System, The Property Freedom Formula, again here is the order:
Step 1 – MINDSET
Step 2 – FUNDING
Step 3 – SITE FINDING
Step 4 – APPRAISAL
Step 5 – PLANNING
Step 6 – CONSTRUCTION
Step 7 – EXIT
We all have to start as developers, if we can do it you can definitely do it. We really hope that this opened your mind to the possibilities of what’s available for you and how in just one deal you can change your life forever and you can start living the life of your dreams that you deserve and your desire.
We love business, we love property, and we love to work with people like you. The question is what is holding you back? What do you need to do to achieve financial freedom and all you have to do right here, right now is make a decision that you’re going to get into a property, you’re going to scale and systematise your business and you’re going to start moving forward and creating a legacy for your children, your children’s children and be remembered for something really positive.
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Best wishes,
Liam Ryan
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