Joining me again this week with our panel discussion are Kelly Statham, an award-winning letting agent, Richard Parker, author of SSAS Pension Legacy and experienced portfolio landlord and Nana Piesie, co-host of the Pengaflode Podcast and early stage overseas-based landlord/investor.
We pick up the second half of our panel discussion this week looking at managing a portfolio and also more complex strategies.
Tune in as the panel share their views on managing the manager, having a dashboard red-amber-green or RAG reporting system, a property management system itself and remaining compliant in an increasingly red tape driven environment.
Then, we consider the management options for more complex strategies such as HMOs and Serviced Accommodation, undertaking thorough due diligence and working with third parties, such as agents and deal sourcers.
Finally, we wrap up part two with some top tips and no-no’s from the panel based on our own experience.
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Transcription of the show
Joining me again this week with our panel discussion are Kelly Statham, an award-winning letting agent, Richard Parker, author of SSAS Pension Legacy and experienced portfolio landlord and Nana Piesie, co-host of the Pengaflode Podcast and early stage overseas-based landlord/investor.
We pick up the second half of our panel discussion this week looking at managing a portfolio and also more complex strategies.
Tune in as the panel share their views on managing the manager, having a dashboard red-amber-green or RAG reporting system, a property management system itself and remaining compliant in an increasingly red tape driven environment.
Then, we consider the management options for more complex strategies such as HMOs and Serviced Accommodation, undertaking thorough due diligence and working with third parties, such as agents and deal sourcers.
Finally, we wrap up part two with some top tips and no-no’s from the panel based on our own experience.
Property Chatter
Welcome to the property voice podcast helping you to navigate safely through the world of property investing, get the lowdown and updates, insights and outcomes on all matters property with a splash of entertainment along the way, the property voice of voice to trust among the crowd. Now, let's get started with your host, Richard Brown.
Hello, and welcome to another episode of the property voice podcast. My name is Richard Brown. And as always, it's a pleasure to have you join me again on the show today, where we're continuing the series property core skills, we're into managing properties and portfolios. As as the latest core skill. This is part two of a panel discussion that we started last week. So making sure he listened to last week to get some context and preamble before you're listening to this particular episode. Last week, we talked about managing a property, maybe a single property, maybe your first property, for example, a buyer-seller, this week, we're going to sort of dig a bit deeper if you like, we're going to talk about managing a portfolio, but also managing more complex strategies such as HMOs, service accommodation, for example. So we've got the panelists. Same as last week, we've got Kelly, stay them, Richard Parker, and now rpsc, who are joining me as on the panel for this conversation this week. So I'm just going to let them pick up we're going to pick up around managing the manager and diving into portfolio management, and then digging a bit deeper into sort of more complex strategies. So here we go.
Just the link back really to what Richard was saying this talk about the portfolio side of it, because you know, your dashboard, as you called it, if then what I basically say is just to pick up on the ultimate, we're responsible as the landlord, ultimately. And if there was, you know, God forbid, that horrible thing that happened in a property, you might find the letting agent in the dock, that you're going to be right there next to them, that's for sure. You know, even if you appointed the listing agent, so you know, do you can't say, well, it was their fault, actually, ultimately, it's ours. So we need to manage the manager. So if you've got a property manager, whether it's a letting agent or your own person, or it's yourself, you kind of need to manage the manager. And so that, you know that, let's just talk about that managing the manager. So you talk about you've got a dashboard. But you know, what, what do you do in terms of managing your properties and managing the managers of your
properties rich. So being an engineer, I'm a very visual person. So you know, I've got a number of properties. And on that, I must say I have a datasheet, that's got, you know, the electrical certificate dates, it's got when the smoke alarms were last checked, it's when the fire alarm was last check, has there been a legionnaire, check, etc, etc. That's a lot of information to try and go through, you know, a spreadsheet. So what I've done is I've had created just a one page that is fed by the datasheet that produces a chart, or pie charts have some description or graphic that indicates basically red, yellow, or green. So in the automotive industry, and I think a number of industries they use, and it's called the traffic light system. So red, obviously, you've got a big job stopper, yellow, there's some problems, but maybe we can work through it and green, everything's fine. So on my dashboard, if I've got a red, I know something's not done. So for example, it could be tenancy reference wasn't done or it, you know, it needs to be done for a new tenant that's coming in yellow. For my getting tickets, I like a bit of pre-notification. So on my dashboard, it flashes doesn't flash, but it comes up yellow to say that gets one of the gas certificates is due in two months' time. So I know I've got some pre-warning that in two months' time, I've got to make sure that I've got that gas certificate done. And any implies and if things are green, I know everything's fine, I don't need to worry about it. And it's just a something I look at every month, you know, go through with my small team. And we just go through that and go right, what are the issues and it's very easy to spot because they're all flagged by the dashboard.
So you've taken us into the area a little bit there of kind of the systems. So your dashboard or a spreadsheet or something like that might be a useful way to keep on top of your properties. But you know what, one of the sorts of common systems approaches that we could have so that people are using so you've got your spreadsheets in your dashboard, that gives you those Alert. I think Kelly, you probably use a system obviously when you're managing hundreds of properties.
Yes, a traffic light system actually, believe it or not. So, and none of this is goes back to your other question as well ask the agent, what system they use. Because, for me, I found that maybe reassuring landlords was a little bit tight, you know, just let you know, you got certs on order or, you know, updating landlords was very timely. So we found a system that works perfectly for payments, side of Rennes, plus any anything to do with their portfolio. So I mean, I don't know if this has been recorded, but I could share, like the screen on the traffic light system. And so when it comes to Nana, say, for instance, I'm managing your properties and you wake up at two o'clock in the morning with the anxiety Oh, my God, what is going on from your property? Is it okay? Because we do we do have those two o'clock 2am moments. You can log on and go, Oh, yeah, no, that the gassers they're brilliant, you know, and it actually gets emailed to you. So you can go on to your property portfolio and see what issues have been reported get all your tenancy agreements, you know, I need to remortgage I need to send them as T's I need to email the agent, or they're not open, well, actually, you can pull everything off your portfolio as though you done it, it's already there for you. So it's a fantastic system. So even though we manage it, it's all there ready for you to just look at whatever time so I know, a lot of overseas landlords like that. And then same with your rent so that the traffic light system draws when there's the whole portfolio, it brings up your gaffers. It gives us a moment's notice on everything gaffers do electric show you pap testing on every single property and it's just, we then send it out to the contractor, we know which landlords want the confirmation. Again, some landlords are their own contractors, some landlords want to send their own contractors out, but then some landlords want just totally hands off. So we know who to send it to. And yeah, and then once it's ordered, it's ordered, and then it goes on to a system where we then go chase, the more we need that certain so then that was know that they've done it. they've always done it, but they're, they're very, they can be two weeks late bringing them in. So we're like, Come on, get into the office, I'll put the kettle on, just give us the sights, we just need these. Because we don't like reds. That means we're failing and ambers, we just need to stop picking on greens. Lovely. Yeah. So
we're just laughing at your style there. I think, basically, you need to know how to manage people. That's another topic, we kind of bring you in, I think actually managing the people side of it. But it's managing the people and the systems together. And I think just on the technology side of it. Now that sort of gave me a cue that you might want to talk about that. But I think, you know, we've got, you can use a simple, you could use a simple filing system. But you could also use, you know, so like, you could have a 30-day thing rolling, you know, constantina file type of arrangement or lever arch files you could do, but it's obviously quite manual intensive. You can have a spreadsheet with dates on that you've obviously you could lean on the letting agents own system, if you're using a letting agent and they have that access for you. As you've just said, Kelly, I think there's also a number of like, apps, and software packages now that you can get as a landlord can manage your properties as well. And you can store a lot of data in those and some of them are either free actually or low cost. So I think that you need to make sure they're complying with data protection warnings. And so yeah, well in terms of making sure that if there's any personal information that is stored securely, and with all the two-factor authentication and things like that, it's exactly where you're going with you, right, and you need to make sure that you're fully compliant, and get those things in place. So now I know, you know, we started to talk about systems, so I can't I think I've kind of covered that ground. But did you have another question that you perhaps wanted us to consider?
Yeah. So let's say when you're scaling up, how about if you get bigger Is there a time when you could consider setting up your own internal property management operation? Taking your portfolio in-house in other words, is that for me?
Well, anyone really I mean, just that's an issue ask that a little bit unless you know anyone else wants to this is an interesting dialogue. mammy Kelly, you said your accidental Lessing agents. And rich I think you were implying that you know you You do I believe you run some of your own portfolio, some outsource. Yeah, yeah. And in from my point of view, when I started, I was exclusively new using agents. But when I've got to a certain scale, you know, if they're in one place, in particular, it might make it, you know, a point where you can consider perhaps bringing someone on in house to, to manage your portfolio on your behalf, or perhaps you could do it, or perhaps you could be part-time in the business to do that, I think there is a tipping point. But if you think about agent fees, and that, you know, 10, to 12%, sort of range for letting agent fees, and you know, if you if you do the economics, if you do the maths, actually, it's quite it's, you know, dare I say quite an affordable way to manage your properties. So you're gonna have to have quite a number of properties or a decent rent role to kind of make the savings worthwhile, perhaps doing it yourself, or even paying for you know, you could you justify a full-time member of staff, would you need more than one, if you think about the roles that are involved in managing properties, just think about what letting agents do, you've got people who manage tenants, you've got people who manage properties, you know, that possibly other people as well. But so if you have, if you're thinking of insourcing, as I call it, bringing somebody into your business, to manage your portfolio for you, you probably need quite a reasonable rent roll to justify the expense, first of all, and second of all, going back to what we're saying, you know, there's all the compliance, keeping up with the legislation, the training side of it, as well. So you got to be careful about, you know, that side of it, if you're doing yourself, obviously, that's quite a burden to stay on top of it. And if not, it's, you know, it's a case of, you know, making sure that the person has got the experience to deal with that, too. And so rich, and
I have a follow on question regarding that. Death, does a landlord get like reduce fee demore? several properties to have or it doesn't matter?
Yeah, they could they can do again, it depends on the agent and the business. If a landlord said to me, and they've got a portfolio, because we predominantly deal with what I'll talk about HMOs on this one, if he says, I've got 10, HMOs? Are you going to do me a deal? I would be a bit real simple, cuz I know what service they get. And, and it's a really good service, I would ask them, are you unhappy? But actually, we put our prices off last year and not one landlord. And we, we were not cheap at all, when we're not yet when probably actually the most expensive in the area when it comes to the management side, but not one landlord. But yes, I was most definitely. And because businesses that work in business to business, and you've got to look after each of those customers. So you can always ask that question.
Yeah, let's just stick with it. That means? No, he was chipping away at the pennies and making sure you know, you got your commercial sorted out? I don't blame you for asking that question. But let's just stick with the fundamentals. I mean, rich, so you, you, you know, you've got a portfolio? What would you say, you know, fully, fully outsourced fully insourced? Is there a middle ground? I don't know, what's your approach? What's your view?
I mean, they're, for me, they're different. It definitely is a tipping point, if you're managing the properties yourself, there definitely is a tipping point where you go, you know, this is a full-time job. So I'll be honest, I tried a VA. And that didn't work for me. So then I brought it all back to myself. And I thought, Oh, this is a waste of time, I just do it myself. But then I took someone on part-time, and I worked with that person and about, you know, I'm guiding them. And that's now working really well, because that's freeing me up away from all the admin to focus on really developing the business because I, you know, I intend to get more properties and grow the portfolio. So I'm only going to get busier. And so that person started as, as part-time. It's, it's back to work now, you know, be very early. So for her, it's great because she's got the flexibility. I don't set days and say you've got to be in the office this day, or you've got to work these days. We just agree when we're going to have a meeting and often it's just via zoom and we go through G drive and look at documents and things like that. But if he wants to change the day, then she can but you know I kind of work on a certain amount of hours each week is that's what I want to work through. But as I get bigger in terms of the portfolio, and Her child gets older and you know is going to move on to school, she's going to get some more time. So it's kind of working quite nicely for me. But again, I'm dipping my toe in the water by hiring a team member not to have full-time team members. But that person, hopefully, it's going to grow with my business as I grow the portfolio.
Sure, you come in back there, Kelly?
Yeah. And I think by happened, you know, it's great, Richard, but by having somebody you've also got to think, what if something happened to them? You know what, that because when you're employing somebody or bringing somebody in, you don't go into the realms of the employment rights, annual leave? What if they can't, you know what, I don't want to be here, no more, I don't want to do this, then that portfolio is then London on you. So again, it's relationships and building more, but as your business grows, so he wants to bring it in the house really need to think about that as well as worst-case scenario? Absolutely.
I mean, I've done this right. And I think I can echo everything that people are saying here. So I've got some of my portfolios is outsourced to letting agents particularly in more remote places, wherever they got one or a couple of properties, so doesn't make any sense. Really, it was really difficult to manage it remotely, yourself. But then I've got where I've got a bit of a concentration of properties. And by the way, that's something I would change, I would have more of a concentration going forward than I did do. But I actually do have my own internal part-time property manager as well. But if you think about it, Kenny, you know this all too well. And, you know, someone's got the keys out at 11 o'clock at night. You know, some you know, the there's a leak there is you know, there's an issue, and it doesn't happen between nine to five Monday to Friday. It never to you know, of course, sometimes it does, you know, so you've got to be available and contactable at all sorts of times. And if you just got one person who's you know, perhaps on a mobile phone somewhere, you know, that just may not be there. And of course, that person needs to go on holiday, that person perhaps has time off sick, that person can't be available 24. Seven, they're probably not as committed to your portfolio as you are. So I actually think it's a tricky one. It's a really tricky one. And it's almost a case of all or nothing. And I think you know if you can have a small team or most maybe considered the whole insourcing solution. And it's no, it's no coincidence that a lot of port for large portfolio landlords become accidental letting agents think that's a route that people often take them Miss or intend to take that route. But they do but where the crossover is, is probably quite in large number of units. And I thought, when you say, yeah, let's think agencies. Yeah. And rich says, I don't know. I'm, like I said, Richard, I think it's different for everyone. And it's just, you know, what, what you feel comfortable. For some people, it might be anything more than two, and it's our, I can't deal with this. You know, for me, it was in excess of 10, before I started to go, this is becoming it wasn't that I wasn't capable of doing it. It was just, this is becoming a bit of a pain. You know, and I need to offload this to someone to deal with all the, you know, day-to-day stuff, rather than I'm doing it. Yeah.
I mean, I've been transparent myself, and no, no, no, you're going to come in with another question for us. But I'll just keep you warm for a second. But you know, when I sort of ventured into having my part-time property managers, basically paying them I'll be transparent as payment 500 pounds a month, as a part-time property manager. But if you then gross that up to an equivalent letting fee and therefore rent roll, you know, you can kind of do the mascot you are thinking how many properties or how much rent, you need to be able to justify paying that person 500 pounds a month. And then of course, they're sick, or they go on holiday, or they're not available 24. Seven, understandably, and you've got them the responsibility of employment, whether there's actually a contractor or an employee, there's still that side of the compliance and the legislation as well. So I think you know, that the, I don't know, I think it needs to be a really reasonable number. But I think I get you rich, where you're going because you're quite comfortable and confident with things yourself and probably can provide that oversight for that person. And I think if you are more of a passive investor, then you know, just kind of skip it to the professionals is probably not but if you like to get more involved in things and are happy to stay on top of it, there's probably some gains to be made. Once you get to a certain scale.
I'm sure Richard will agree as well as well as the landlord manager, the agent, the agent has to manage the staff to make sure that they're Doing what they should be doing as well. So if you do begin house and you do get somebody working for you, you still need to make sure that they're compliant because it's your business still at the end of the day. So it's everybody check in everyone.
Couldn't, couldn't agree more. And I think again, it goes back to managing just managing everyone consults, where there's a backstop, you know, come on, then I know you've been waiting there, bated breath. You've got another question. I feel it's like, it feels like question time, doesn't it? You know, we're asking the audience a question for the panel. Come on down, or what have you got?
So we have covered despite the length, I'm thinking about, let's say if you like, how is it when it's lettings with HMOs? And say, what's involved in managing these more complex type of lettings, you want HMOs essay or service accommodation?
Yeah. Truth with HMO. Come on the Kelly we walk through and professionally underneath all of this fully grey HMOs are very hard to manage because you have got not only the compliance, the legalities, but you have got a very busy house where there could potentially be lots more maintenance that's required. But you've also got tenants with different personalities. So this, I know, this is another topic about managing people. And so I won't go into that, but they can be very challenging, you will come across lots of problems that you never thought you would ever come across in your life. And lots of different people. So and, and you need a strong backbone. I personally think it's a bit hard to keep it full and take them all the time. You are always going to get people that just they sign up to the tenants day, and then you know that they're a week late with the rent or a month if they pay and then they're not contacted or nobody's seen them that will always do a ruiner or they have I don't find letting rooms out very hard at all. But it's our process, how we work that for it again, it and I'm sure Richard will say it's the area, the demands, and everything that goes in with that. So you need to be doing your full, full checks. And there is lots of checks, unfortunately, because there's going to be areas that are saturated areas that aren't so saturated. I've had landlord come to me three, four years ago saying apparently this area's really really saturated. Well, no, I beg to differ actually, because all our rooms are full all that we've probably got one or two that are empty for maintenance reasons and I know Richard all know this because I met Richard who passed a portfolio over to us and that portfolio really, really struggled. But I know and I'm pretty confident that he can go to that landlord and that landlord says well actually it's been a really good property because they are filled and it's just how it's managed I think. So for you suggest we got all remote investors should always call the letting agent and ask their take before proceeding a HMO
Yeah, ask them what their what the areas like what the market you can actually you can do your own research as well. And I know a lot of landlords do this. They put out the spoof I bet on spare room and room. What are those do they use? I don't use them. Yeah, country so they put out those kind of adverts on there. And just this is another question to ask the agent. What platforms do they use to advertise rooms? Because if they're just using Gumtree, you are going to struggle filling your rooms, unfortunately, do they use popular platforms like Zoopla right move on the market. If they use in them, it shows you that actually, they're using money that the letting fees to invest in the business, their business, and your business to make sure that you've got a full portfolio. Personally, I hate an empty room. means I'm losing business and losing money.
Yeah, count me might make some really good points, I think you know, a lot of people. So if you just follow this chain through, you know, a lot of people will either go on a course and we said just go HMOs because it's hot their high yield. So you make more money, right? Or they're worth the deal source and they go, here's a house which is going to slice into four or five or six, and it's going to be an HMO, you're going to make bags of money, and you're going to pay me a lot of money for doing that. Right. So there's just a couple of scenarios that a lot of newbies could fall into. But if you don't research the area You know, you might buy a pup, frankly, you know that you know is there the demand for an HMO, you've just said in your area, it's you know, some people think it's saturated, some people don't think it's saturated. The numbers are there, there are ways in which you can check the supply and demand ratio, you can check things like rooms wanted versus rooms available on spare room, for example, that gives you an idea for the sort of supply and demand sort of mix, you can do something like looking at the ratio of properties to let versus properties less agreed on some of the big portals like Zoopla. And that gives you another idea you can look@home.co.uk and look at the average time to let you know for rooms and that will give you how long it's been I think equally I think, you know, you kind of asked the question, and this is it. So Kelly, there was a gentleman called Daniel, who I think reached out to you, if you can remember. Right, yeah, yeah. So there's a chap who was saying to me, I'm looking to invest in the sort of Mansfield Nottinghamshire area, and you know, just going to spend some time up and I said, you must talk to Carrie, because she knows the go areas and the no go areas, she knows street by street. So that's why I sent him your direction, hopefully. So you can compliment his own research. That's the point. So I think a good listing agent will give you the time of day, you know, to talk about areas to talk about the demand for your property, whether it's a single, or whether it's an HMO,
I would personally rather get involved with an investor at this point where they're thinking of purchasing, because if they come to me at the end and say, oh, I've been giving you a number you, you know, you've been moved about or whatever. I've got a property and it's on such and such street, and it's been given up a lot. Sorry, I went to a champ, because I know that landlords been given a rough deal. So you do need to check your deal sources as well. Because again, deal sources, they don't need to be like, I can get all these houses for sale, I'm going to put it over to you and I want 2000 pounds for the sake of it. I pass deals or send deals out not deals out to landlords, I'll go check this one out. You need to look at this one. This is good. You know, because I've seen the floor plan. And they've got Oh, yep, brilliant. I've got a landlord in Spain. It'll just go there. Yep, got that one brought him for, you know, so he is more than happy. He's just brought a photo bed hotel for me to do, I'm not great. And so check those as well, as well as the builders. And the ways that you can check them all. go to properties, ask what properties they've done before, see the work, see the evidence, ask somebody to go and say what is it like do viewings on how they manage properties as well. Because getting into the property is where you see everything, the real, the real deal if that makes sense. So yes, there are definite no go areas, in every single every single town of the whole country. There are no-go areas and you will struggle and you will potentially only get problematic tenants depends on your business model, I suppose. Yeah,
I mean, to be honest, I think the letting agent as a source is actually investigator Kenton Kalima say best-kept secret. Because, you know, whether it's an estate agent or a saucer or a deal packager, what's their interest, their interest is to sell you the property and take a fee not necessarily for the ongoing management and maintenance and you know, the property and the tenants occupying it. So they you know, they're not they're not paid for that. So I think a letting agent is worth the weight and gold and here's a story and someone in apprentice program at the moment. It's a sad story, because basically, he bought a property from a deal saucer and it was an HMO or presented as a fully compliant HMO. You know, I'm gonna say, don't you, it was a fully compliant HMO. And he literally gone through the full conveyancing process was about to press the trigger. So he made just to sort of find out so there's a load of fees, you know what's coming next. And he asked, that is apparently it said, fully compliant HMO with letting agent in place. So he spoke he then spoke to the letting agent who was supposed to be the one in place, and they went, we don't know anything about this, first of all, but we're happy to go around and have a look for you. Now. This is prior to completing the contract. And the agent went round. He said, don't touch this with a bargepole. It's not compliant. And I don't know who told you that we were lined up to deal with it, but we certainly not being consulted, and nor would we touch it. So he pulled out the transaction because he was sold a very, very bad deal and he was currently written off several 1000s of pounds in abortive costs with the saucer with the legals with the financing. And it's a very costly mistake and actually had exactly what you said Kelly, how do you suppose Consider the letting agent at the beginning of the process that could have been avoided. So that's a bit of a warning sign there, I won't mention the person to save their blushes. But there we go. The last agent is probably the last person that you need to contact when actually, it should be the first because they've got the knowledge, the experience, and you will build that relationship. Or if somebody said to me, can you go and look at, you start to build those relationships, chips off. And if you help somebody and you give them valuable information, your time it then becomes a business, if that makes sense. And you build it together and it shouldn't fail. And yeah, that that one deal like that. Richard, just be somebody his entire business gone out the window, if it's the first one before they've even started, which is wrong, very mad.
In his case, I think of 7000 pounds worth of fees. So that was not a night issue. But of course, you do have actually completed on the purchase, it could have been a whole lot worse. So I totally take your point. But Kenny, once you've got your interest there, I want to move into talking about we're gonna make this a two-parter, by the way people are comfortable talking because I want to talk about projects as well. But and but before we do that, Kelly just wanted to ask you nanner in his question, he did say more complex strategies like HMOs houses multiple occupations, which we kind of focus on a little bit. You also mentioned serviced accommodation, and short-term letting now if I pose that question to you, if somebody came to you and said, I'd like to, you know, do some short-term letting in your area? How would you respond to that?
We don't actually do serviced accommodation, because again, it is it, you can't have too many things in too many pies as such. So taking on serviced accommodation is not something that I'm interested in. However, I would always recommend somebody that I trust with serviced accommodation and has that knowledge of serviced accommodation. Again, you know, serviced accommodation is tends to be quick turnarounds, you know, you have your part. There's lots more to it. So I would say, Unfortunately, we don't manage, however, and can put you in touch with somebody.
Yeah, I thought you might say that. Yeah, a bit. It's another specialist areas, in fact, a completely different business model. It's a hotel model, effectively. So you talk you're talking about renting a property by the night by the week, rather than by, you know, on a short-term tenancy agreement, the rules and the regulations, the marketing, everything is different. So I'm glad you said you didn't just do it just take anybody on.
No. And I know, I mentioned that a landlord had brought a dirty bad hotel, but that has been turned into a big HMO just to confirm not a hotel.
Okay, just this something I've mentioned, while you guys were talking about, and they had gone to service, accommodation, I think Kelly kind of touched on this. But I think beyond the standard viateur there, if you're talking about HMO, or something else specialized like service accommodation, using an agent that is specialized in that sector is really important. When I did my very first student Hmm. And I was going to have it managed. And I made a massive mistake of going to a standard, you know, standard letting agent. It was a complete and utter disaster. But I've missed I missed the window for the student period, it was all I can say it was an unmitigated disaster. So then I took the Prop, I took the opportunity to do some refurbishment and work on it. And then I put it with a specialist, HMO student letting agency and the operation it was just like chalk and cheese, you know, it is it's a very different way of operating the business. So can I you know, obviously specializes in housing loans. For anyone who's got HMOs and thinking about putting it with an agent. Don't think you can just give it to any agent. A lot of them. They'll say they know what they're doing. But it's it's again, it's a kind of it's a different animal and you really want to talk to someone that knows what they're doing.
And I'll jump on that Richard because of a lot of agents that just go old 12% for managing Oh, right. Yeah. Oh, and there's five lots of 12% I want a slice of this pie and we're seeing it more and more with really big national companies. So what you need to be asking is, how often do you do the checks and literally all the compliance and how do the tenants contact you because actually part of the license and I can send you what a license looks like to show you what the agent needs to be and why mod needs to be compliant and they need a 24-hour phone number as an emergency contact. They need all the content That details Oh, I've been to these properties that they manage there is nothing compliance about them. What they are doing is tenant screening and pointed talent and leaving them. Big, big, big, big, big, big No, no. Sorry,
I think it's a big No, no, I think that's great. And, you know, I was gonna make, I was going to extend this conversation, talk about projects, but I think I'm going to leave, we've talked about properties and portfolios at this point in time, I can see rich has been up since three o'clock in the morning or something. I think he said, He's probably his eyes are closing on it. So I think what we're gonna do is draw this one to a close. And, you know, we are to be honest, I could talk for ages about it, but probably on a podcast, it might not be great if it goes on for three hours. So what was what I normally like to do towards the end of a discussion like this is just kind of go around the room and get you sort of either your top tips that, you know, maybe haven't been covered, or your major no no's, Kelly, you just kind of gave us a major No, no. But if there's anything else that people want to add in terms of managing properties, managing their own managing a portfolio, what be sort of top tips, things to keep, you know, Top of Mind or something to avoid, and then feel free to join in. Because I know you do actually have some properties. And you can tell us what you've learned as well. But I'll save you for last perhaps. So, Kenny, you're rich, you want to kick us off with top tips or things to avoid coming at you rich?
Okay. So for me, it really is about educating yourself. If you're thinking about doing anything, and simply if you're, you know, looking for agents, or you're gonna manage yourself, educate yourself, read books, listen to podcasts, don't necessarily go on training courses, you need them to speak to someone who's done this. And it could be an agent, it could be someone that you know, that's got property, you need to educate yourself. And you know, be a little bit informed before you just start and poking around in the dark, is what I always recommend to people. There's loads of information out there, there's loads of people, again, the good thing about the property community is lots of people are willing to give you their time and advice completely for free. You know, we've all made mistakes, we're all quite happy to share, you know, our horror stories, and so other people don't make those mistakes. So talk to people, inform yourself, and then and then go go forward on that basis.
That's great. Thanks, rich. Kelly, I guess I'm saving data for last. So you can come in with one but what would you say?
No. Again, I would just probably echo what Richard said, and ask the questions. No question is a stupid question. The only stupid thing is an unanswered question that you don't ever ask. And get yourself out there on the proper social media groups, like the HMO forum with Rick Gannon is you know, he's very well. knowledge about all these areas as well. Don't over-invest in property courses again, you know, because sometimes they can be shocked to just know who you're working with as your business and it's your responsibility. If you want it to succeed, make sure you invest your time and knowledge into it. As simple as that.
Thank you, Kelly. Come on Vandana.
Hey, so I'm gonna say, trust but verify. So, so I think you're working with someone, send someone with that. And that doesn't have any gain, financial gain or anything in there to verify what the person is saying. Especially when you remote investor. Beside that, I think you guys cover everything to be honest.
Thanks, now, no, and I guess, you know, you have covered everything. Actually, one extra one for me is don't take the responsibility lightly. I think you know, being a landlord is serious business. You're not just you know, you're talking about somebody's home that we're providing for them. Just think of the money and the responsibility that goes with that. You're looking after someone's home, you're looking after the property, that could be very, very serious consequences of getting it wrong. And you know, if you need selfish motivation, it could be serious consequences for you personally. But needless to say, if you leave someone you know, in a slump, you know, you act as a slumlord. You know, the beds in sheds, the damp issues that you lean on habitable accommodation, don't be one of those people. Okay? So that's my biggest piece of advice is Take, take the role responsibly. And you will have many, many years of a rewarding, you know, property experience as a result, but don't treat it, you know, in a slapdash manner. So if you're going to do it yourself, get a self education Like rich said, if you're going to get someone else to do it, give it to someone like Kelly, who's like, no knows the score and knows a way around things. And as I'm gonna link you all together, and as Nana said, always trust and verify. So do your research. Know,don't trust anybody suspects everybody.
Verify we're changing it. Yeah. Okay, brilliant guys, listen, thanks very much for joining us today. I'm just going to do a quick wrap up so that we can just, you know, send this to my producer one go. There, it's been a pleasure to have you Richard Parker. County, save them. And Nana Pac, thanks so much for making time for joining us on the podcast today, you can find the show notes over at the website, the property voice.net. If you want to know anything about today's show, or talk about anything, or even be introduced to one of our guests, subject to them being happy to share their details, of course, then email me podcast and the propertyvoice.net. And if you want guys, I can share your links and, you know, contact details in the show notes as well. So just make sure I've got those. And that's okay to share to share them with people. But I guess the all that remains to be said is thank you so much for my panelists. And thank you so much for listening today on the property deals podcast. And until next time.
Well hope you enjoyed that. It's interesting to get the diamond dynamism, isn't it of the panel discussion with different perspectives, the letting agent, the portfolio landlord and the overseas investor, each, you know, with their own different perspectives. And me somewhere in the middle, I guess, you know, we've my own insights. So we started off with we're looking really at the portfolio management side of things and managing the manager. And, you know, using systems was one of the first things that we talked about whether you have the dashboard system, or red amber green traffic light system, that both Richard and Kelly referred to whether you got a spreadsheet, whether you're using some kind of property management application or software solution, or whether it's a lever arch file or a constantina file, have a system in place, so that you can keep on top of your property, your tenants and your and your properties is the watchword there. And of course, the letting agents have systems as well. And you can ask them what sort of systems are used not just the technology, but how do they get, you know, how do they ensure that stay on top of things, I was literally talking to a letting agent today. And they actually have an external audit every quarter, from a third party company, and they come in, and they check everything in their entire portfolio, and they produce a report. And it basically says, you know, what, what's, what's compliant was compliant. And there's silly things that can happen, you can just get a date transposed, or you can pick up the wrong date from a piece of paper, those sorts of things can, you know can happen, especially when you start to get into more complexities such as running, or rather, managing lots of different properties and lots of different tendencies. So, you know, we talked about when should you consider maybe taking your portfolio in house, and we, we certainly, we got some slightly different perspectives there, you know, from someone who's more of a self managing portfolio landlord, taking on a part-time resource to help them which was Rich's point of view. You know, my perspective was that there's a tipping point, which is actually quite high, that you know, to justify the expenditure alone, and bringing somebody in even on a part-time basis, he needs to have quite a large number of properties to be able to justify that not necessarily large number of properties, but a large rent roll. So that perhaps you, if you can replace the cost of a letting agent who bear in mind, is a professional is trained to be to do this job. We talked about some of the challenges, perhaps of managing people have not been fully resourced 24, seven now and still having to stay fully compliant. So it's not an easy decision, it's not a straightforward decision. And equally you need it needs to have a concentration of properties in a certain area, perhaps to make that work. Then we started to move into looking at some of the more complex strategies such as houses in multiple occupation and service accommodation. We know I think it was quite obvious. We're on a video call. So I saw Kelly sort of literally showing her hair. I don't know if she was showing it falling out or going gray I think she said it was going gray because she manages you know, hundreds of HMO properties. And they're very hard to manage. There's a lot of wear and tear on the properties a lot of to you know, coming and going with the tenants is perhaps more of people issues to manage, we might invite Kelly back on another episode to talk a bit more about that and how she deals with that. So you know, you need to be on top, fully on top if you want to get involved in certainly self managing an HMO, and indeed the that we talked at one point about agents who say yeah, we do HMOs but do they really do they specialize in HMOs they really understand that particular model or they just sort of sit as an opportunity to make a little bit more money out of your properties. So try and go with a specialist. And the same applies with serviced accommodation Because service accommodation is a completely different business model is a hotel model, as I mentioned, it's not actually sort of a residential tenancy model. It's much more as a turnaround model, you know, managing logistics, cleaning and laundry, managing the marketing of the property in different types of platform, totally different. So an agent who says they specialize in, say, single HMOs and serviced accommodation, probably better have a very large office, and lots of different people to actually really pull that off. So don't just fall for it. So he says, I'm a jack of all trades, spanning these particular things, because they're probably spread very, very thinly, is what I would suggest. And then some things to watch out for make sure that the agent is, is advertising your property, whether it's an HMO, a single lead or service accommodation on the right platforms. And they really should be advertising on multiple platforms to actually get the best chance of success, which is Kelly says demonstrates the investment in their business and in yours. In fact, it was a really we touched on dealing with deal sources, and to you know, to check on them, check on their credentials, check on their former work, check with their former clients. And I gave a story of you know, somebody who got their fingers burned, basically, by just over trusting, working with a deal saucer. I think, again, the value of working with the letting agent early in the process was highlighted. So a lot of people think, Oh, I'm going to find a property, I'm going to buy the property. And then I'm going to find a letting agent. Actually, as Kelly pointed out, do it the opposite way around, you know, I'm thinking of going into this area, talk to a letting agent, go to this location, don't go to that location, they're worth their weight in gold, they really are. So engage them earlier on and a good agent won't mind having that conversation early, they might even be able to steer you into a decent property transaction. So have that conversation early. I think where are we so there was talks about using specializations we talked about not overstretching ourselves across multiple different types of strategy. And I think we just started to conclude them with some of the top tips to wrap up, or no nose if you like. So rich talks about educating yourself speaking to people have done this before and remain or stay informed effectively, if you want to be on top of managing your properties in your portfolio.
Kelly was saying there's not such a thing as a student as a, as a daft question, asked all questions. Now join the right groups, know who you're working with, and don't necessarily spend a lot of money on training courses. We're talking about certain types of training course, if you understand me. So that's that. And I think Nana came in with trust, but verify, but we might rename it I have to Kelly's intervention as suspect, but verify. So don't trust anyone just check everything, which is probably fair comment, to be honest in this industry. And my final point was, you know, don't take the responsibility lightly, because you're dealing with someone's home, perhaps even their lives at the extreme. So, you know, make sure you do take it seriously, you recognize responsibility, and that you, you look, you invest in your asset, you safeguard your tenants, you give them a habitable safe place to live, and it shows they should pay you back over time. So there you go, that was the end of Part Two, where we talked about namely, managing large portfolios, and also more complex strategies. Hopefully got some merit out of that. I'm going to queue up part three, but I'm not sure if I'm going to get to part three. So part three will be a specific episode around managing properties. So if you don't hear it, ignore what I'm just about to say. Otherwise, Part Three is coming up about managing properties. So in managing projects, so managing projects, so there we go, might have to edit this out subsequently if we don't do that one. But there we go. The show notes are going to be at the website, thepropertyvoice.net as they usually are, you cannot you can email me podcast at thepropertyvoice.net if you'd like to talk about anything from today's show, or perhaps have an introduction to any one of our guests, whether that's Kelly Steven Richard Parker, Nana PSE, I'll be very happy to introduce you to them if you'd like to. But you know, all that remains really say thanks very much for tuning in once again this week on the property boys podcast. And until next time, Ciao, ciao.
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Transcribed by https://otter.ai