Welcome to the HMO experience. The UK's only HMO focused property podcast where every Monday Matt Jaime & Steve will inform and inspire you about everything to do with hmos rent to rent and how to set up and grow a successful HMO business whether you're just starting out or you're already on your way. Hi guys and welcome to experience and in this episode we're going to be covering off. The essential steps for a successful rent rent property View and I want to welcome my co-host Jamie more everyone and Steve afternoon everyone and we're going to take you through and in this episode and some of the bits and pieces and that we follow I guess when we carry out their property views for a renter and property. So with that in mind, I'm going to let Steve kickers off on this little journey and I will but in when necessary and I'm sure James We'll add some valuable little nuggets as well. Cool. So yeah for for me the viewing actually starts before the viewing so that might sound a little bit back to front but with rent to rent what I found and perhaps you found more. So in London than out in the sticks where we are you need to be able to make decisions really quickly because there's bound to be some competition on your heels. You've not only got other Our HMO management companies or rent to renters as they're known as following your footsteps. The agent also may be thinking about renting it out on a single there. So you've got a you've got to be able to make a decision relatively quickly unlike when you're purchasing a property where you've got a little bit of time on your side. So the preparation for the viewing always starts. Well before we actually do the mewing. Yeah, and that preparation is mainly around the numbers and I think we'll do another Decide on how to do the deal now. So this and Jamie's got some hmm hacks coming up. So doing here share those insights with you, but you need to know what you can offer and in an Ideal World. You've done all your testing your adverts all that before you doing the viewing you've done a run through the numbers. So, you know what the cash flow is likely to be obviously you've got your minute, but we call the minimum deal. Value so that's the absolute minimum that we're prepared to take that property on that and trust that that's 500 pounds. In other parts of the country might be different amounts, but you should try and stick by that and with that number you then go in and negotiate but you don't really go station first off its checking to make sure the property is what we call fit for purpose. So if the property is an existing HMO, then you know that the majority of the key. The elements are fit for purpose. What do I mean by that fire regulations HMO license that is got paying customers. Yeah, because you'll be able to see if there's a if the rooms are occupied or not, if you're going into an existing HMO and then say it's a 6 bed and then two rooms occupied. You've got to ask the question why yeah, and that'll either be because it's not being run or operated effectively and which case massive opportunity. Yeah, or if it does look like it's being run properly then maybe there's a problem with the supply and demand but you would hopefully have checked all about prior to going on viewing. So the other things that we do when we're going around and particularly where a property is occupied is we do little things like we're some of the agents think of solitude flush the toilet and there's a bigger who spend a lot of money on things like the hot water Working yeah, or the the drains are clogged know that the shower doesn't heat up and work. So we want to we want to go in and check all those things out ideally on the first viewing and the whole premise for that is so that we can make decisions quickly and we can make an offer quickly and therefore secure the property quickly. If we didn't do that then there's two potential consequences. The one first one is as already said you might be taking on something that needs some work and then for some extra money The second thing is that you can put those elements into the Larry the negotiation. It's really easy for me to say you put those elements into the negotiation so that it balances out if when you're if you're Asian is asking for too much. Yeah, and you can only offer them so much then you've got some other weapons in the in the Arsenal to trade off with so it's always good to know those things are front and By knowing those things up front. It means that we can move direct to the offer normally on the first on the first viewing. We obviously if it's an existing action mode all the room sizes are good to go. Although we'll put a strong caveat in that you should always do your own measurements and your own checks definitely gonna say, yeah because there's a lot of hmos that weren't properly license or how subsequently Fallen foul of the change. In legislation where by rims were able to be rented out and now under the new regime, they're not a could be rented out. So again, you don't want to be left with the property. Let's say a 6 bed you take it on you find out we can't rent one room out that's in going to impact your cash flow and you'll be making a little bit of profit or breaking even or in worst case scenario losing money. Yeah, definitely not the aim of what we're looking to do carry around a little laser. Yeah. Stop, we we use magic plans. So when Courtney who's a property manager goes around and looks at prospective properties. She will just quickly take out arrived had two very quick calculation if it's marginal and then she'll go to that a little bit of extra detail. But if it's like 12 square meters and it obvious they then it's all good. So yeah, the the process should be quick then. Therefore it's focusing on the function the functionality of the property and do your numbers before the viewing so that you know what the maximum is that you can offer from a rental perspective as you're going around the property you might be picking up little bits and pieces that you can use as leverage to get work done. So that's what we do if the property is occupied if it's not occupied if it's a standard residential property that we're looking Convert into an HMO. Then more works is likely to be done. And the normal thing to happen is to put a stud wall up between the the two reception rooms. So it would be really handy to know before you go into that view into know what that's roughly than a b and so therefore having a good handyman on your power team or a plasterer or a carpenter or those types of guys will give you an indication of what that cost is likely to be so that you can factor that into your costings and be able to respond quickly the other things that you need to consider whether it's a residential property or an existing HMO, not so much if it isn't this nation, where is the furniture? So where there are small rooms you need to give consideration to the types of furniture you're buying and in particular storage, so we look at buying Bates with storage underneath or storage drawers rather than putting in a wardrobe and the chest of drawers we buy I think they're called gentleman's wardrobe. So not meant to be sexist or I think sorry ladies. I'm sure there's a ladies equivalent, but I believe it's called a gentleman's wardrobe where you've got sort of hanging space above and draw space underneath. So again, you're sort of minimizing the furniture requirements and maximizing the storage solutions within the room if they're bigger rooms, then it's about but certainly those are some of the things that we're thinking about as we go around the viewing and what furniture we going to need to put in here so that we can build those costs into our deal analysis to work out how much the lease rates going to be if another Lisa or if we're going to buy it. We need to make sure we've got money in the bank to be able to purchase that property about furniture. Sorry, so those are some of the things that we look for what about you when you're going around in modem when I so I will do some similar prep in terms of the numbers because you know, I spent quite a bit of time researching the area that we operate in our kind of now have a gut feel in terms of if I see property online. I see hopefully we'll have a floor plan. We should make easier so you can get a good idea of the sort of room sizes and then I'll know so you mentioned in terms. Of proper numbers, we generally work on our ounce or 750 800 pounds a month net for a five bed. It will be thousand pounds plus 4 a 6 bed and you know having sort of looking at the general allow the property in the location is important and then on the actual viewing itself check in sort of the same condition of the property like is in good decorative order. Yeah, you know, they're you mentioned obviously check. Toilets the other thing we do certainly the hot water, you know, checking under the cupboard Under the Stairs to see where the bagasse me to his money electrical meter is you know, make sure there's don't bail so little things like that and also to see what sort of standard the doors are if it's not so we've only taken on one property that was set up to be HMO other all the others have been converted into an HMO. So checking out what the the standard that the doors were they suitable bar. They fire doors already the smoke alarms interlinked hardwired. So those are really the most important bit and check them under their thumb locks Mmm Yeah in there already. Yeah, one of the things that we've noticed is that particularly from doing the mentoring is that the back door very rarely gets checked. Yeah. So all of the external doors To have a function. I had to get one changes on on our one of our properties and it was a pretty straightforward process. They just have to check out the the locking mechanism doesn't cost much but you need to sort of stuff and then I think the one thing that we don't do is we don't put up stubbles. No, so we will generally go for properties either have Bree beds and one reception in they have a quite a large reception. You know, we've looked at a few properties where there has been the option to put up some rule from our perspective. I think the added cost and the potential for civil Fair wear and tear planes or dilapidation claims that the end of the term of the agreement is something that I'm a little bit wary of so, I think a lot of the properties that we generally look at have got to Receptions, which is Handy but yes life a lot easier is not so much easier. Yeah. I just think you know the the leading time to get in the property set up. If you don't have to do any major works you have that is just so much shorter and enables you to you know, marketing quicker get it filled quicker and obviously, you know get it producing Revenue sooner. Yeah, I think other than that, there's those are really the main bits obviously doing the numbers. Definitely I think now we've got to a point where you know, I kind of know the area that we operate in really well, so I'll have a gut feel for what the rental should be for the property itself what the rental should be for the rooms. So I'm I have also got a relationship with a couple of Agents while say look like this property, but realistically this is what we're going to be able to offer bearing in mind the numbers and the condition and all that kind of thing. So, you know as things evolve it is quite nice to have That relationship where you can sound them out and said you be honest, you know, it's on the this you seen the property. Is it really worth that? Yep? No go. Well. Yeah, the landlord is asking for a little bit too much because when we valued it we validate this but he was insistent or she was insisting on it being marketed at that and it's you know, it takes a while obviously to get to that stage but it's quite nice to have that in your locker because then it kind of makes it a negotiation and it'll be easier if you've got the Even on your side already. Yeah, I did a podcast recently for the internet experience about how to build rapport with agents and what they should work with you all and was directly and I think what you're saying makes absolutely key when it comes to render any particular everybody benefits if they understand what they get out of it. So one of the things was going to add to what these guys have just said is little things like having a chat to be letting agent skin and weld them use that first feeling if it is your first few There's an opportunity to build rapport with them. Because there are loads of people doing exactly what you want to do in your area. It's a competitive market out there. Yes, if you can stand out just by doing little things other people don't do. Yeah, Steve mentioned magic plan map talks about the laser measurement. Those things are really really good because you can start not only showcasing the knowledge and experience by saying why you do that but also has little things that most people don't do and that's the benefit of you listening to this podcast. You can use some of those things even if you don't think you got any experience or any track record of Didn't yet in setting up and running a ranch? Uh, no business there thing. I would add to that a sovereign location location location team and Kirstie allsopp was going around a property with a couple and the bloke the husband who was part of the buying couple was about 6 foot. He just could not visualize his empty property if they can get their furniture and so courtesy got this poor guy to lie on the floor and go. Well, that's a devil. So for there and that helped two divisions by his when the room is big enough for this. So far I've known that but I don't see you later. Well, the reason I mention that courses and obviously for those of you not on the YouTube channel and just listen to the podcast I'm slightly more vertically challenged in these two Trends. So I definitely couldn't do that. But just food for thought you had asked was Steve. Have you seen a property yesterday for registering? Yeah, tell us about that. So we went to see Obviously we took it on the essay and we did is all the things that we we advise and the most important thing is to systemize it so we've got Courtney mentioned before she's a project. She will be going out in the future and go in assessing those properties because she's got a standard template that she works too. Then she can feed that back to me and then I can make a fun the fundamental decision, but at some point should be making decisions on our own. The to challenge your hands if you don't systemize it then you've got to be present all the time. Yeah, so having a document or a process or a step of actions that you go through every single time will create leverage free up your time particularly as your portfolio starts to grow or if you're in full-time employment and you want to take on someone part time to do this stuff for you. If you can then document that viewing process and get them to take away. Viper photographs Alone video put that on a shared folder somewhere so you can do that in the evening if you can't be at the viewing in person because as I said at the very beginning it's all about speed and if you can't get to the property, but you can get someone else to do that for you. Then you still in a similar sort of position to be able to make a judgment call relatively quickly and what happened with that property States. We took it on go. Excellent. And how long was it again? 15-minute. There you go. And what did you put an offer in after viewing 16th minute? Okay, there you go. And that's the power of knowing what you're doing and having a systemized you've actually seen breaking, you know, you survived the top of and this episode is you know rents around it's about speed because you don't, you know, you're in competition with other potential, you know rent to rent businesses or you know with families. I guess we've just come out and share a season. So particularly the types of properties that are suitable for Rent rendering share a season like you need to act quickly to take the opportunity and get the property on board. And I think as part of your process do you then have also standard short list of questions that you would ask as and when you go around no, it's not. It's not really asking you questions at that stage because it for us and it would depend of the property is already occupied or not, but it's more about the suitability of the The property so for example, the one that we took from yesterday is already occupied. Okay, it's got is a little for bed. It's got four people in there one joined in September one joined in August 120mm a and one's been there for two years. Okay, so we actually had the privilege of meeting to around new customers. So we asked them about are they enjoying it there have there been any problems because it's all right very well the agent saying there's no She's dead. Chances are the agents probably never stepped in that property before them got clue. So it's always good to to ask those questions of the people actually live in there. Yeah and everything come back fine. I could feel the heating was on so that's a person which in turn are legit. Yeah. So yeah, so but the the ranks that they're paying a probably not what we can achieve so at some point we will start to walk the price up and we'll do another episode about how you do that and And walk up price over a period of time but the property looks from a deck or perspective. Perfect. The toilets flush. The hot water came on. Yeah, all the doors are secure every door had thumb turn lock on it both the back door and the front door, they'll shower pressure was good the water drained out of the sink and out of the shower and out of the Basin in the in the bathroom. Sure. So as we're going around the age of the Agents are looking at essence of like wondering what we're doing is as we were turning on showers and turning on Taps and looking at plug holes and all that type of stuff another quick tip when you're looking at the basis, but if you're taking on sweets and things like that check to make sure that each base of got a plug because if it doesn't have a plug what the customers will tend to do is stuff toilet paper in the in the waist hole and then where does that go? So little little things like that and the plug cost like to pound my air line off of Amazon. So yeah miniscule forcing they will happen. So all those little bits and pieces checking to make sure that the oven works if it's a gas of turn the gas off on one of the problems with gas hob is sometimes the electric spark doesn't work, you know, if it's an electric pole then that will heat up relatively quickly. So all these little checks as you're doing here Lee. Yeah get his building up confidence in that. I'm not going to be faced with potentially. He's intelligent challenges time because it's going to take time Jay about those problems and we go live with that on the 18th of November. So because we've done those things and yeah, we're with 99% confident and that's not a work well for us. So yeah something might crawl out of the woodwork, but we'll pick that up as well as we go forward. But yeah, and if it if it wasn't blocked by with the exactly the same checks only the we would just have to find more customers for it. Yeah. But then one of the things that I did when I first started on this journey was after a few games. I started compiling a checklist of you know different either questions to ask or like you just went through like different things here. So whether it's in the kitchen or bathroom or check assure the lights of work and I think one thing you mentioned to me one time was you take your phone charger and yeah, well the plug sockets in work. Yeah, so we just we This into distinct phases. So that was the viewing that we did yesterday when we actually take a property on and maybe we'll do a completely separate episode. We've got a hundred and eight step checklist that we go through some of which we've already tested as part of the take on process. Yeah, but there's a hundred and eight things that we share and as long as we've got a check mark in each of those boxes, then when the first customer arrives, although it's a bit different in this instance because you already D we're inheriting for excellent customers. So some of it we won't have to do but if that property was empty then we would go completely through that checklist. And as long as we got to check in each box, then when the first customers arrive they have a positive experience for sure. That's handy. That's cool. Yeah. I think I'm gonna be much more to add to this. I think the next stage like you mentioned will be actually on board in the potty. So we've gone through couple of few points for the guards to you know, carrying out of viewing so See the pre-prep that you do before you get to mewing, you know, make sure that your numbers stack up, you know a few of the essentials in terms of when you're they're actually carrying out the viewing so, you know compliance aspects, you know, when you saw the basics work there is Heating and water and then building the rapport with the agent which in my mind is probably the most important step in all of this is you know, they are very much The Gatekeepers to name obviously access to more properties, right? So I think for now if you happy we're going to leave it there. We wrap it up. 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Monday we're going to bring you another great episode of the HMA experience when we will be covering off viewing the body. H&M is goodbye for Jamie by Roy your bike from Steve. Goodbye for me. Thank you very much. Bye we hope you enjoyed this episode of the HMO experience. Don't forget that all of the resources mentioned in each. Sold will be available on our website. Www.hsn.com Xperience. Doc Co dot u k we regularly update our website with new content to help you along your HMO Journey. So make sure you check out www.va.gov MOA experience dotco dot U k-- for more details. Also remember to join our online community by liking the HMO experience Facebook page and subscribing to our our YouTube channel
In this episode your podcast hosts Matt Harris, Jamie Madill & Steve Mitchell share with you their suggestions on the essential steps for a Rent2Rent HMO viewing. Get this right and you are more likely to beat your competition and secure properties quickly; get it wrong and you will probably lose lots of profitable opportunities in your area. KEY TAKEAWAYS   You need to prepare for your viewing before you turn up at the property, one of the most important things is to make sure your numbers stack up. It’s essential you need to know if the property is ‘fit for purpose’. If you are viewing an existing licensed HMO you will know that the room sizes are fine and the fire regulations have been complied with. On the other hand, if the property is a single-let then you need to know what’s needed to convert it. Have a good Power Team will help you understand the costs of any works that might be needed and you can use the cost of these in your rental negotiation with the agent or landlord. Checking things like flushing the lavatory, running the hot water and turning on the shower, gives you an indication that everything works. This will save you potentially costly maintenance jobs to get the property ready to rent out. You must document your viewing process so you can leverage the help of others, especially if you work otherwise you will miss Rent2Rent opportunities. BEST MOMENTS    ‘We’ve looked at properties where it was possible to put up a stud wall to create another bedroom but we’ve turned those down as it’s often quicker and cheaper to get the property ready & rented out if you don’t need to do these works’. ‘If you don’t systemise your viewing process then you need to be present all the time. And that’s not always possible’. ‘Rent2Rent is about speed as you are in competition with others. You need to act quickly and put your offers in fast’  ABOUT THE HOSTS Matt Harris - Matt started working for a Mayfair based property investment company before practicing as a property lawyer. In 2013 he swapped law for cleaning and set up The Organised Cleaning Company! In 2016 Matt started MiPropCo Leeds, a buy to let investment company and in 2018 he founded MiRentCo London, a multi-let management business providing co-living accommodation for young professionals in London. Jamie Madill - After an 18 year career in advertising Jamie became a full-time property investor with a property portfolio of single-lets & HMOs and with Steve, they have created a successful Rent2Rent HMO business. Jamie is an international public speaker and co-founder of Progressive Property Network and co-host of PPN St Pancras. Steve Mitchell - Steve had a successful corporate career in finance and risk management before becoming a full-time property investor. He owns a portfolio of single-lets and HMOs. A black belt in Six Sigma, Steve is the project management and systems expert. Steve is also co-host of PPN St Pancras. 