Allow Landlords to evict tenants where there are 14 days rent arrears14:34 PM, 1st October 2020
About 4 weeks ago 97
Robin Pilley invests into HMO’s in the Haverhill area and regularly achieves up to 16% yields, he is also a Director of CXG Property Services, which is a Letting Agents and Property Sourcing Company. As these yields are so good we’ve asked Robin to share his story in a four part series. This is the third article in that series.
In my first article I explained how my brother and I got into property. In my second article I explained how we grew the business but how our model was challenged by the self styled “experts”, “mentors”, “gurus” and we faced the question of whether to change our model or not.
Hindsight is a wonderful thing and a decision that we made at that time to continue along the same path was one of the best decisions the company made.
The reason being is that interest rates dropped to a 100 year low which meant our mortgage payments on some properties reduced to under £100 and our monthly rent was still over £1,300 and growing, so were our investors happy? Had we advised them correctly? Did we steer them through the credit crunch successfully?
None of our investors got into financial difficulties with the properties we had sourced. However, some of them bought properties elsewhere and followed the no money down deal path. They ended up with mortgages that the rent did not cover and properties they could not sell as they were in negative equity.
Another important ingredient to our success is we maintained the philosophy that where there is a niche market that allows us to offer high cash flow positive properties then we should target this market. An example is when the UK had increased immigration from Eastern Europe, especially Poland, we were the only Lettings Agency in our area that spotted an opportunity by offering weekly cash payments for rent, providing a furniture package, flexible with our credit scores and accepted low deposits. We soon realised that the majority of these immigrants were hard working, kept their properties clean and in good order, and saw the UK as an opportunity to improve their living standards. We found that they paid their rent on time and, coming from a culture of renting, happily respected the terms of their tenancy. In fact, many recommended CXG to other members of their growing community and we soon captured this market.
We were often able to obtain a premium on rents for the services provided which meant that not only were the tenants happy but our investors were happy too.
More to follow next week………………
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