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Ethical & profitable investment opportunity
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  • 1. Ethical & Profitable Investment Opportunity Property Trading Business Proposal
  • 2. Background • Bought my first property in early 2003, 3 bed semi for £64,000 • In 2013, same property is valued at £120,000 with a mortgage of £22,000 • Bought 2 additional properties in 2008 using 25-30% deposits! • Financed by fee earned from freelance project management • Quickly ran out of seed-capital so started sourcing properties for investors • Involved in a total of 12 property transactions to date (part time) • Built up excellent relationships with agents over 5 years. Source of deals! Lessons Learnt • A strong desire of home ownership in Britain. Rent is lost money. • First time buyer properties go up in value over long term (12-15 years) • Distressed properties can be purchased at huge discounts often 25-30% off their true RICS valuations. Cash is King! Even better discounts available. • Property is a seasonable business with busiest periods from Easter to July.
  • 3. The Opportunity Acquisition Strategy • Purchase properties with cash at 30-35% discount to valuation • Offered 2-3 hugely discounted properties that require a cash purchaser weekly • Acquire properties with no kitchen or bathrooms (cash only) • Add value: tidy up clear the property of rubbish to showcase its potential • Make property mortgageable: add 2nd hand sink/cooker a few old units Exit Strategy • List at most prominent local auction at a guide price of original purchase price! • Competitor and less sophisticated investors buy often over the guide price • Target to make between at least £10,000 per property every 3-4 months • Leave a some profit in the deal for the next buyer making it a true ‘win win’ • Auction activity picking up as a result of lending conditions & economy
  • 4. An Illustration…. • Type: 2 bed room investment property • Purchase Price: £45,000 • Legal fees: £1,500 (includes preparing an Auction Pack with Searches) • Guide Price: £45,000 (similar properties sold in auction in excess of £55,000+) • Achieved Price: £57,500 minus fees • Fees: £2,000 Auctioneer plus conveyancing fees of £500 • Profit: £10,000 after all costs.
  • 5. Investment Proposal • Angel investment of up to £100,000 on a draw-down basis, not upfront • Property remains in Angel Investor’s name with a contract for profit drawn • Angel investor receives 60% of all profits for first five deals then share reduces to 49% of all profits going forward on a permanent basis • Angel investor is given a weekly update on progress of each trade • Totally hands-off investment and all works is done for Angel Investor • Scalable model – One could buy 2-3 properties per month • Economies of Scale – Purchasing & trading more properties results in greater discounts being achieved • Leverage – Leveraging our expertise/contacts to make a profit • Security – Property in name of Angel Investor therefore, peace of mind!
  • 6. Investment Proposal • Angel investment of up to £100,000 on a draw-down basis, not upfront • Property remains in Angel Investor’s name with a contract for profit drawn • Angel investor receives 60% of all profits for first five deals then share reduces to 49% of all profits going forward on a permanent basis • Angel investor is given a weekly update on progress of each trade • Totally hands-off investment and all works is done for Angel Investor
  • 7. Reasons to Invest • Tried and tested model by other investors e.g. National Home Buyers • Offer a much better, honest and transparent to distressed home owners e.g. no upfront survey fees or further reduction in price just before completion! • Scalable model – One could buy 2-3 properties per month or more… • Economies of Scale – Purchasing & trading more properties results in greater discounts being achieved • Leverage – Leveraging our expertise/contacts to make a profit • Security – Property in name of Angel Investor therefore, peace of mind! • Property turning around the corner – low interest rates and First Time Buyers • Bricks and mortar cash rich, less sophisticated investors’ appetite to buying • Model can work equally well unsold auction properties to open market…. • Investment in individual leading to other opportunities ‘forgotten properties’ • Start with just one property and see how it goes…
  • 8. Realistic Profit Projections • Year 1: £50,000 • Year 2: £100,000 • Year 3: £250,000 • Vision is to become largest property trading company in the UK • To give money, help and time to others less fortunate than us.
  • 9. Thank you for listening. Questions?

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