15:44 PM, 3rd May 2016, About 7 years ago
Having raised over £500,000 to take West Bromwich Mortgage Company to the Court of Appeal it has been suggested by numerous Property118 members that we should become a Landlords Association.
Sentiment appears to be that a group with courage to take legal action against rogue mortgage lenders and poor decisions made by Government is seriously needed in the UK Private Rented Sector.
Subject to levels of interest this is something that we are willing to consider further.
Towards the bottom of this article you will find an expression of interest form. The ideas we are considering are:-
The growth of Property118 has been tremendous over the last five years as can be seen from the statistics below. This year we are projecting in excess of 5 million page views.
Property118 Growth – 1st Jan 2011 to 31st Dec 2015
Property118 Stats – 1st Jan 2016 to 10th April 2016
Whilst there is no guarantee that we will convert Property118 into a Landlords Association it is something we are seriously considering. A decision on whether to progress will be made based on the responses to this article. Here are some of our thoughts to date ….
The existing Landlord Associations have a track record of being shy of litigation.
Property118 has a track record of raising funds and seeking justice through the Judicial System. Ombudsmen and lobbying have their place but rarely achieve much more than publicity for a particular cause. If we progress this ideas and Property118 Landlords Association is launched we may not always be successful in litigation but we will pick our battles wisely and ensure that in every case the minimum outcome will be far greater awareness of any issues affecting UK landlords which to choose to tackle.
Transparency is key. We are capitalists at heart which means that we believe that success has to be rewarded; for our members, for ourselves and for those who back us financially. We have discussed the possibility of implementing a similar structure to that of Shelter and becoming a registered charity but we do not feel this would be right in terms of our core objective for transparency.
Property118 already owns 26% of the shares in LettingSupermarket.com as well as having revenue sharing agreements with many of our website sponsors. If we were to create a Landlords Association we would do so whole heartedly. In other words, all of the existing business arrangements that Property118 has (which for the avoidance of doubt doesn’t include our private property portfolios) would be incorporated into the Landlords Association.
The founders of Property118 value the goodwill of the current business at £5 million. If we were to incorporate our existing business and transform it into a Landlords Association then we would want our members to own part of it and to be as financially committed to it’s success as we are. To achieve this shares could be sold. This initial share capital would be the foundations upon which Property118 Landlords Association is built and would also provide us with confidence that we are doing the right thing.
If we decide to go ahead our first objective would be to recruit 50,000 paying members within 5 years. This would produce circa £6 million a year of revenue, i.e. £10 per month per member X 50,000 members =£500,000 per month.
To enable members to own a stake we could initially offer 1% of shares via a crowdfunding platform for £50,000. The minimum investment could be just £10. Over-funding could then be considered, e.g. if there is enough interest to raise £500,000 then 10% of the shares could be made available and so on. Whilst such a structure would decrease our personal shareholdings it would also provide funds to facilitate a more rapid growth in terms of membership recruitment.
To provide some assurance to both members and investors that we wouldn’t simply draw all profits from the business ourselves we would be prepared to commit to capping all directors emoluments to the projected 2016 earnings level of £225,000. That would be the maximum that all Directors collectively could take out of the business in terms of salary, bonuses etc. Any additional income for the Directors would then rank on par with that of the shareholders from dividends.
Property118 currently operates on a profit margin of circa 35%. Assuming this figure is maintained and assuming the membership target of 50,000 is achieved then shareholders earnings would be £2.1 million per annum. This equates to gross annual earnings per £10 share of £4.20.
Now some people may say that a 42% ROI based on an initial target of recruiting just 50,000 members from a pool of what is said to be around two million landlords just isn’t right and that the returns are too high. Well that’s capitalism folks. Once this target is achieved the value per share will not be £10 either!
Some will ask, what if Property118 doesn’t grow and what if Mark Alexander were to die, so I will address those points now. I post less than 2% of all comments and articles on Property118, the rest are posted by our members. On that basis, why should Property118 stop growing, are landlords likely to face no challenges in the future? Nobody is irreplaceable or has a monopoly on good ideas. Nothing that has been achieved by Property118 has been achieved by one person alone. It has been the vision and engagement of a growing community of landlords that has brought us to this point. The question for us all now is this; where should we take it from here?
Membership growth is projected to be achieved organically, as has been the case for page views to date. This is because existing members share their interactions with Property118 and their positive experiences with other landlords. Momentum is continuing to accelerate, as can be seen from the stats, and we have every reason to believe this will gain further pace once we have proper funding and infrastructure to campaign and appeal against other injustices against landlords and back our challenges with legal action as neccessary and commercially viable. Furthermore, a broad, growing and solid financial and membership base combined with increasing revenue streams will provide additional opportunities to fund increased PR and brand awareness campaigns. Given that there are believed to be around 2 million landlords in the UK we would like to think the initial objectives we are considering should be realistic. What do you think?
Existing monetisation projects will continue unchanged, save for the fact that all income and profits will accrue to the new company.
We would also apply for EIS relief on shares. This has significant tax benefits – details here >>> https://www.gov.uk/government/publications/the-enterprise-investment-scheme-introduction
At last – a #landlords‘ union!! EXACTLY what we need! https://t.co/qr7Uvqpyft @IamALandlord @jamesalexandere
— Mandy Thomson (@lodgersite) May 4, 2016
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13:05 PM, 9th May 2016, About 7 years ago
Reply to the comment left by "Appalled Landlord" at "09/05/2016 - 12:16":
As usual, I agree with your points completely 🙂
Think it might have been myself who originally linked to the report you mention @ http://www.property118.com/consultation-budget-landlords-2015/77343/comment-page-5/#comment-62186
13:31 PM, 9th May 2016, About 7 years ago
Reply to the comment left by "Mark Shine" at "09/05/2016 - 13:05":
It must have been you - way back in August!
Simon Lever - Chartered Accountant helping clients get the best returns from their properties
14:32 PM, 9th May 2016, About 7 years ago
I have only had a chance to skim over the details of this thread so forgive me if I have missed something.
When I first came across Property 118 it was a forum for both landlords and tenants to freely exchange thoughts and opinions and to also ask for advice and help.
There are still some threads that follow this.
However since the July budget of last year the tenor of this forum has changed substantially with major threads being for landlords and how to deal with the various changes brought in by the government since then.
I can see how you have picked up on the potential market for a landlords' association and the various benefits thereto. However it seems that the goalposts have changed over the past year and the nature of the forum has changed substantially.
I would prefer to see any landlords association outside of this forum. A place where landlords and tenants can freely exchange views can only be of benefit to all parties but if it is linked with a fee paying association then you will lose some of the major benefits that started the forum in the first place.
Mark Alexander - Founder of Property118
14:46 PM, 9th May 2016, About 7 years ago
Reply to the comment left by "Simon Lever" at "09/05/2016 - 14:32":
We were always a forum dedicated to facilitating the sharing of best practice for landlords, tenants and letting agents. That has not changed. I agree that several more of the discussion threads and readers questions over the last year have been posted by landlords but tenants and agents are equally welcome to post. We do not control who submits readers questions.
There is no plan to change to forums, it was considered but the membership spoke up and it was decided to keep the forum unchanged.
Property118 Landlords Association would hopefully provide an additional dimension to the PRS without detracting from all the other good things in Property118 and the excellent work of other landlords associations and professional bodies representing service providers supporting the PRS.
I trust that answers your questions and thank you for commenting.
15:47 PM, 9th May 2016, About 7 years ago
Reply to the comment left by "Mark Alexander" at "09/05/2016 - 14:46":
Drop Property 118 from the association title, and give it an alternate name, so as not to cause confusion with Property 118 forum.
Mark Alexander - Founder of Property118
16:07 PM, 9th May 2016, About 7 years ago
Reply to the comment left by "Bill Williams" at "09/05/2016 - 15:47":
Our thoughts on that is the Property118 brand is well known and ranks particularly high in search engine results. That has massive PR value. Also the Property118 brand is now associated with being established in terms of legal challenges.
Mixed brands would also cause confusion in terms of marketing.
16:52 PM, 9th May 2016, About 7 years ago
Retain property118 as the general subject centre then propertysolutions118 as the problem solving environment
16:58 PM, 9th May 2016, About 7 years ago
If we use any title with the trendy word 'Solutions' in it I resign as Hon Legal Counsel.
There is even a company called Water Solutions Ltd-literally, water dissolved in water.
And don't get me started on 'find your happy' or 'travel yourself interesting'.
19:06 PM, 9th May 2016, About 7 years ago
Reply to the comment left by "Mark Alexander" at "09/05/2016 - 12:36":
WTF? Are they serious?? This is supposedly a landlords association, right? But they completely misunderstood the European tax rules, claim our figures are wrong and that we're a bunch of get-rich-quick merchants who thoroughly deserve it?!?!
They then go on to make some ludicrous assumptions about our liquidity - which isn't hugely relevant to the injustice involved - and then say much better fights are against HHSRS and LACORS?!?!?!
Jesus wept. Are they really landlords or has their site been hacked by morons?
Mark Alexander - Founder of Property118
19:14 PM, 9th May 2016, About 7 years ago
Reply to the comment left by "James Fraser" at "09/05/2016 - 19:06":
Apparently that's the consensus of the members of Portsmouth and District Landlords Assocation - yeah right!