MY RULES OF PROPERTY INVESTING

  

1. Never buy a house I wouldn’t live in myself

A nice simple self-explanatory rule to start with!

With all my houses, even the ones in the less popular areas of the city, I would still be content to live in them myself if I had to. Because if I’m not prepared to live in the homes I’ve created, why should I expect anybody else to?

If the street or area is rough and ropy or unsafe, or the house is not refurbished well enough, then it’s not suitable for customers / tenants / people. And if I think it’s not good enough for me, it’s not good enough for others either.

 

2. Only buy houses within 20 minutes from my front door

I’m Leeds born and bred, and have lived here all my life. Whilst I can understand the appeal that some other investors have about buying property in different areas all over the country, that’s just not for me.

My goal was always to provide local homes for local people in my home town.

And because my houses are relatively close, I can visit them easily, or get there quickly if there’s an emergency to deal with.

 

3. Ensure the property cashflows a minimum £250 net profit from the rent per month

From a monetary business aspect, each house must create positive cashflow every month after the mortgage has been paid.

 

It astounds me to hear of landlords where the rental income only just covers the property’s buy-to-let mortgage.

Or even worse - the mortgage is more than the rent, so the landlord is effectively paying for a tenant to live there!

Make sure you make money from each property, or you may end up in debt, stress, and trouble.

Another key property business mistake to avoid is this: don’t get too emotionally attached to the houses either - it’s a business, so they are effectively just boxes that you make money from. As long as you maintain and look after your boxes and their contents (people included!) all should be well.

4. Have the potential to add at least £25k to the end value

Buying houses below market value is not always easy. But that’s the way my business model works. I’ve got to be able to uplift the value via refurbishment to be able to pull out mine and my investors’ money when the property is revalued, after all the work is complete. So you need to be realistic when checking end values and ceiling prices of the rest of the comparable houses nearby.

Be cautious when researching likely end property values, so take your cheerful rose-tinted glasses off!

Here’s one of the very few places in life where it’s better to be cautiously pessimistic / realistic in the financial figures rather than overly optimistic.

5. Don’t deal with dickheads

There’s no other way to phrase this nicely.

Some people will just cause you chaos, stress, anxiety, and cost you time, money, effect and energy.

There’s lots of lovely people, tenants, contractors, and professionals around…So we don’t need to waste our time with unscrupulous and unsuitable people who just do not respect us.

They may be rude or disrespectful or patronising to you, not do as good a job as they promised, trash your house, lie to you, and generally cause you a headache. The key is being able to spot these types of people before you engage with them.

Which leads us to…

6. Use your gut instinct when working with other people

Spotting genuinely good people from those who just pretend to be, is difficult.

I’ve had a plasterer that promised me he was awesome - then walked off the job because he couldn’t get his plaster to stick to the ceiling.

I’ve had a HMO tenant be such a charming manipulative liar that he lied to my face with ease - only to then stop paying rent, and become an avoidant problematic bullshitter.

I’ve had a tenant wanting a fresh start of stability from her chaotic past and provide a secure home for her children - only to repeat her same mistakes, get involved with drugs and violent boyfriends and utterly trash my house and abscond leaving a horrendous and expensive mess for me to deal with.

The common factor in these, and every case I’ve had which has turned out badly, is that every time, I had a niggling feeling in my gut that something wasn’t right about these people.

But I chose to ignore that uncertainty I felt and gave them a chance anyway, because I try to be nice like that, and trust that they won’t let me down with their chance.

I don’t do that anymore.

If my gut instinct tells me something isn’t right about something or someone - I believe it.

 

7. A void is better than a headache

Following on from my last point, if your gut instinct tells you someone will not make a suitable tenant in your property, wait until you find one that is.

There’s plenty of people around needing housing, so we shouldn’t be so desperate to grasp rental money that we end up putting someone unsuitable in our properties.

Not only because if / when it all goes wrong, it’s then very difficult to get rid of them, especially if you have to go down the costly eviction route.

Do stringent checks on your potential tenants, and if someone’s not right or you just don’t get a good feeling about them, say no.

It really is better to have a void than a headache.

I’ve left rooms and properties empty for weeks and weeks sometimes, because I haven’t been totally happy about potential tenants that have viewed them.

The right tenant is worth waiting for.

You’re looking for long term stability and reliability in your tenants, not just filling your wallet with short term cash.

 

8. Avoid false economy during refurbishments

It may seem like a good idea at the time, not doing certain things during refurbishments to save time or money - but it is false economy in the long run.

Examples I have made like this which taught me this lesson include:

⁃ Not putting radiators in kitchens. Only to then later have to retrofit electric heaters.

⁃ Not replacing the old gutters at the same time as having a new roof done. Only to then have to replace them a few years later - and the majority of the cost was having to put scaffolding up again.

⁃ Buying cheap poor quality boilers - only to then have to replace them way before the usual boiler lifespan because they went kaput.

Better to do big jobs all at once during the refurb, rather than kicking the can down the road to have to deal with at a later time - and likely with more expensive retrofitting or replacement costs.

 

9. Be a good person

Unfortunately there are a lot of wretches in this industry.

They talk a good game, give a nice winning smile, extort money from people… only to then do them wrong or rip them off for vast amounts of money. Eventually though, all these wretches get found out, and rightly so.

Because it’s not enough to just PRETEND to be a good person - you’ve got to actually BE a good person.

And that means caring about other people, rather than taking advantage of them for your own selfish needs.

So be understanding when your tenant is genuinely struggling.

Pay your contractors’ invoice swiftly when they have already completed the work for you.

Repay your investors in full and on time - and if there’s a problem, be open and honest about it, and work hard to get it resolved.

Things do sometimes go wrong - in projects and in life - but radio silence and lack of communication just causes mistrust and makes things worse.

My final thought on this topic is one personal life rule I live by:

Don’t ever say anything or do anything or behave in a way that would make your favourite grandma ashamed of you.

Your Nanna and your conscience are watching - so don’t let them down, and do yourself proud.

 

10. Have great integrity and do what you say you will do

Last one, which is a nice follow on from the previous rule.

It surprises and appals me how many people in life don’t actually do what they say they will do. I think if you do have great integrity, you really are in the minority of people.

You wouldn’t believe the amount of people I book tenancy viewings or meetings for, who don’t even turn up.

They don’t appear, they don’t call, they don’t do the thing they agreed to. It tells me a lot about that person.

And an unreliable, untrustworthy, flaky person of poor integrity is not the sort of reputation you want other people to have about you.

Having great integrity is always doing the right thing - even when no one is watching.

 

So those are my own personal ten rules of property investing - and as you’ve seen, it’s not just about the tangible bricks and mortar aspect of it!

Best of luck with building your own property portfolio, because it’s not easy.

Because if it was, everyone would do it…

Wouldn’t they…?!?

 

THE BENEFITS OF GROWING UP SKINT!

The other day I was musing about how I rarely get sick, or have never been seriously ill, and I surmised it was because of this reason:

I grew up as a child on a council estate in the 1980s… so my immune system is pretty much immortal!

It seems being mainly outdoors as a child, with no fussing over a bit of muck or dirt, is a good way of building up strong immunity.

But it got me thinking…

What are the other benefits do you think you have gained from growing up with little money?

Fat Baby does a cheeky grin at having to make her mum cut her elasticated sleeves!

Here is a list of ways I believe I benefitted from growing up skint!

RESOURCEFUL

You made do with what you had, and you made your own entertainment. In my case this included making rose petal perfume, creating my own library out of my books, a VIP Halloween party in my bedroom, and I have particularly fond memories of making mixtapes by taping songs off the radio and MC-ing to them.

These cassette tapes, Kelly’s Funky Jazzy mixtapes, volumes 1-20odd might be worth a fortune one day! 

I’m listening to the original Funky Jazzy tape right now as I’m editing this blog… it started strong with 80s legends The London Boys!
And my mate’s keyboard playing and singing is particularly entertaining!

YOU LOOK AFTER YOUR STUFF

Because you didn’t have much, you looked after the stuff you had.

This explains why thirty plus years later I still have many things in near-immaculate condition: my Beano annuals and Enid Blyton books, I have decades-old clothes and trainers, various toys and wrestling figures (and don’t say you wouldn’t have arranged them in order of your favourites for the photo either! )

But even now it’s engrained in me to look after things well.

Really must clear out that loft, the tenant probably thinks there’s a corpse locked up there!

22p?! Can you get owt for 22p these days?!!

I’ll be impressed if you can name all these WWF Wrestlers!

I got very distracted very often with my nostalgic items whilst taking pictures for this blog.
But these dancing flowers are worth a pretty penny on Ebay!

NOT EASY TO SHOCK

“Interesting” things happened on streets where there was council housing… burglaries, fights and disputes, screaming and shouting, clothes and belongings being thrown out of windows, people shoved out of doors… all good entertainment, and excellent for building up a tough skin of unshockable resilience!

Stand there with that big vicious savage German Shepherd, it’ll be reyyyt…
An 80s fake Jerry Lee!

FRIENDLY AND SOCIABLE

Everybody knew everybody on the street, and most people were helpful if they could be. Like the time I accidentally stuck a wallpaper scraper in my forehead, and our elderly neighbours Betsy and Laurie helped my panicking mother sort out my bloodied forehead mess (look for the scar above my eyebrow – Harry Potter clearly copied me! )

Top tip: don’t give children sharp tools, folks…

Or in fact, don’t give me tools at all; I can’t be trusted not to hurt myself with them!

All anyone wants in life is a knight in shining shell suit!
And I LOVED that cap!

GOOD WITH MONEY AND BUDGETING

When you have very little money, you have to learn to manage it well. So budgeting becomes a key skill you acquire, because you know your money must last. It means you don’t ever waste money on poor value items.

Earlier this month, I was utterly horrified to watch my friend get ripped off at the ice cream man, £4.50 for a cone! 

Not in our day: a great value ice cream from Mr Rossi cost just 25p.

Or if money was tight that week you were told, “NO, get a choc ice out of your freezer” 

Hell fire, a nonce’s dream! Which leads us to our next point…

CAN SPOT A NONCE A MILE OFF / GOOD GUT INSTINCT.

This is a very strange and peculiar spidey sense I have developed since childhood. Not least because we were clearly told: “Keep away from the nonce at number 37” etc.

It was common knowledge to everyone locally who all the paedophiles were and where they lived, and thus was totally acceptable to talk freely about them / warn children to avoid them when you saw them.

This in turn meant you learnt to see and recognise bad people and sense things about them. I think they have a strangeness and a particular ‘look’ about them – and it’s not just because they wear a particular style of spectacles, known in the 80s as paedo glasses.

Anyway my point is this: it meant I developed a real good gut instinct about people. And not just if they’re a wretch child molester. I can tell when something’s not quite right with someone, or even if they are feeling bad / sad / not quite themselves, on a particular day. Weird, eh?!

CHEERY, AND MAKE THE BEST OF THINGS.

You had little, you might have been skint, hungry, lacking in the latest toys, and wearing second hand clothes – but you got on with it. There was no point dwelling on what a terrible lifestyle you had or how bad luck the hand you were dealt was – so you might as well make the most of it, no matter how dire the situation.

For me, this meant skating down the house ginnel in roller skates singing “Just one Cornettooooo” or failing badly trying to master a pogo stick – and the day my mate’s mum got a large paddling pool from a catalogue was like jackpot!

Picture shows original ginnel!
And absolutely sweet threads for the kids in the 80s!

Also:

MANY HOURS OF INDEPENDENCE AND CONFIDENCE BUILDING

Toodling along on my little scooter with my mate on his BMX around the village. Yes, we were free to roam the entire village; no soft namby-pamby, mollycoddling, don’t-leave-my-sight helicopter parenting in the 80s – you just had to make sure you were back home when the street lights came on! Great for pushing your own bravery levels and comfort zones!

We would explore the village, and also deliver newspapers to all the posh houses, me in awe at how much bigger and nicer they were than ours.

(Must have subconsciously made it my mission in life to one day own a bunch of houses!)

I was so amused the day I got given this ‘Adult’ ticket at a show that I kept it!
SEE MUMMY, THE MAN SAID SO!!

This has given me possibly the biggest benefit of all:

A GOOD WORK ETHIC, GRATITUDE AND APPRECIATION.

I appreciate everything, because I still remember what it means to have nothing.

Now I am (supposedly!) a grown adult, and a comfortable homeowner with my own business, I don’t ever forget my roots, or where I came from – nor am I ashamed of it.

Although I was embarrassed at the time, being one of the very few minority kids in Drighlington Juniors from the few council house streets that were on free school meals – and I think that burning shame sticks with you and spurs you on to do better.

I believe if you were born poor, it’s not your fault.

But if you die poor, that’s entirely your fault.

So I’ve worked hard to escape that poverty trap.

And in an interesting twist of fate, a large percentage of my rental houses are ex-council houses, meaning the previous owners have likely bought them through the Council’s right to buy scheme.

So I buy them and then often house families who have been on the council housing waiting list many years… because the council now doesn’t have enough council housing to house low-income families.

Ironic, eh?!

So on the whole, I think I’ve developed many benefits of growing up with little money.

And yes, I can only imagine that privilege is good – but graft is better 

Featuring Sam the teddy, who still gets to sleep with me every night! 

I’ll leave you with one final amusing anecdote of childhood life in the 80s:

Sunday night bath, then drying off in front of the gas fire in your nightie, watching Bullseye on the telly.

…ONE BATH A WEEK?!?

WHAT WAS ALL THAT ABOUT?!? 

Make no wonder my immune system’s bulletproof! 

I have no explanation as to why I looked like a young boy for about, er, 40 years…

THE TOP FIVE BOOKS I’VE READ

THE TOP FIVE BOOKS I’VE READ… in the last few years, of a self-development nature, although two of them were audiobooks I listened to but I’m still counting them…

Well, the title pretty much tells you what this blog is about!

I'm so old now, I have to wear my glasses to read...

I’ve always been an avid reader, but I switched from fiction to self-development books when I started my property career.

I meticulously log the titles of all the books I read, but it was only in January 2021 that I started grades for each book, giving each one a mark out of 5.

So this is how I can easily pick out the best I’ve read to share with you. Well, from the ones since I started grading them that is!

So here we go, in no particular order:

1.     Happy Sexy Millionaire by Steven Bartlett

An audiobook, which I listened to the majority of whilst driving to and from Birmingham earlier this year. I like authentic storytelling of genuine hardship childhood stories, mixed with no nonsense fluff, so this was good for me.

Here’s the tinterweb link I used to listen to it for free! 

https://youtu.be/Z2-x2bANIUw

 

2.    The Monk Who Sold His Ferrari – Robin Sharma

I bought this on the recommendation of a lovely lady, and it got one of my (few!) 5-star ratings. Again, an interesting biographical story, about, well again, the clue’s in the title!

 

3.    Atomic Habits – James Clear

Another audiobook I’ve given a 5 to. This was over a year ago, and with memory failure I’m not sure why - that’s the problem with driving and listening, you can’t make notes or plan out things to implement immediately! I do remember thinking at the time though: this is useful to help with my (as yet undiagnosed) ADHD traits - so I will definitely be revisiting this book. And making notes this time!

 

4.    Eat The Frog – Brian Tracy

I go through phases where I’m a terrible procrastinator, so this book definitely helped with my mindset to stop faffing about and gerronwi’it. And I tell you what, Mr Tracy must have had a positive effect on me, because he’s made it into my list twice!

 

5.    No Excuses – Brian Tracy

Doing well for ‘clues in the title’ today, aren’t we?! Anyway, Brian did well again with inspirational mindset work which fired me into action. This was an audiobook too, get yourself a bit of Brian ont speakers!

 

BRUCIE BONUS –

Yes, I know I said Top 5, but this one’s also down in my list graded as a 5, and so I’ll feel bad / unfair / it will upset my Libra sense of righteousness if I miss it out! So, last one:

 

6.    Get Rich, Lucky Bitch – Denise Duffield Thomas

A lady that changed her mindset around money and gives inspirational help and insight into how to do it too! I like Denise, and I follow her on various platforms. She’s no nonsense, casual in her approach, and non-ranty (sorry Mr T. Robbins; I like you, but forced positivity is hard work for us Brits!). Anyway, DDT’s a top lass 😊

 

So there’s my best book recommendations for you, and before you go, here’s why reading self-development books is so beneficial:

You get to learn in a few hours, key skills and knowledge that has taken other people spent decades of experience and research to learn.

How’s that’s for a quick-fix, easy way ‘cheat’ to success?!

And books are mere pounds in cost, compared to hundreds or thousands spent on courses and seminars!

 

It is said that Warren Buffett spends 5-6 hours a day reading, and look where that has got him: one of the five richest people in the world.

So if reading is good enough for Uncle Warren, it’s good enough for me!

 

UNCLE WARREN SAYS:
GET READING, GET CLEVERERER!
(or something like that, probably!

Best wishes, and happy reading (or audiobook listening),

Kellyann