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Today, I am delighted to share a conversation I had with John Howard, who is one of the most accomplished property developers, traders and investors in the UK today, with four decades of experience in the industry. John’s proficiency stems from the purchase and sale of over 3,500 houses, apartments and developments within the UK.
He is also a best-selling author and if you want to understand how to survive four decades in the business, then listen in as he shares his ‘three unbreakable rules’.
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Resources mentioned
Connect with John Howard…
T: +44 (0) 7921 529 224
E: info@johnhowardpropertyexpert.co.uk
Connect with John via LinkedIn
Web: www.johnhowardpropertyexpert.co.uk
Seminars running in September!
The Property Elevator Show & Property Question Time on Sky Channel 189
Also, a regular poster on Property Tribes
Property Deal Tips & How to Reach me By Telephone
Link to the Podcast feedback survey
TPV Apprentice Programme info HERE
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#PropTech: A guide to how property technology is changing how we live, work and invest – a link to the latest book.
Property Investor Toolkit – here is the book link on amazon.co.uk & amazon.com in case you would like to get yourself a copy to accompany this series
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Transcription of the show
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 on the show again today.
Today, I am delighted to share a conversation I had with John Howard, who is one of the most accomplished property developers, traders and investors in the UK today, with four decades of experience in the industry. John’s proficiency stems from the purchase and sale of over 3,500 houses, apartments and developments within the UK.
He is also a best-selling author and if you want to understand how to survive four decades in the business, then listen in as he shares his ‘three unbreakable rules’.
Property Chatter
John Howard
A lightweight heavyweight at just 12 stone!
John’s father became an estate agent and John started working for him aged 10. This provided a good grounding in the business. John joined the business and eventually started to run it aged just 17. Estate agency, property management, building society and an insurance broker in the process. It didn’t go too well, which provided a lot of learning! As a result, John decided that buying and selling property was better than being an agent.
On 18th birthday, John bought a property along with some borrowings from his mother and a bank loan. Sold one within 6 weeks for a similar price to what he paid for the pair.
Family – give a decent return and a small share of the profit. John then bought the agency from his father aged 18 and subsequently sold this in his mid-twenties.
John engaged a kind of ‘angel investment backer’ who sponsored him to buy some bigger deals. Made almost a million on one of his first tower block deals.
Survived the 92 recession and learnt a lot in the process. Moved into listed buildings converting into houses and flats, along with a number of ‘difficult projects’.
Director of Cambridge United football club, also a racing yard owner. Then acquired a 50% share in Auction House UK, subsequently selling a year ago. Bought a property called the Wine Rack on Ipswich Waterfront, got it funded by the UK Government £26m project completing this year.
3,500 properties traded over four decades. Enjoys development but especially buying portfolios and then divesting them to make a profit. John enjoys the chase, dealing with people and helping people.
Book: Property and Investment for Newcomers available from www.johnhowardpropertyexpert.co.uk
John enjoys giving back despite his obvious success.
2% finders fee for any deal introductions...his number is in the Resources section above!
Strong emphasis on minimising the time in the deal, to keep a lid on the finance and holding costs. For example, order the searches as the seller in advance of the buyer ordering them.
Be in control of the deal, whether buying or selling.
Why do high net worth investors borrow money: transfer risk, low cost, gearing and spending on lifestyle. John puts his share of capital in but usually looks elsewhere for the rest.
On-time and on-budget conversions over four decades = none. This is not the case with new build necessary. Get a fixed price with a full schedule of works but always have a contingency fund to allow for unforeseen events.
John has no interest in upselling onto lengthy training courses and programmes. Many educators have this as a principal income stream. There is no regulation around this area, which has a high-ticket value.
John got started with a financial backer (his mother), although had been involved in property for around 8 years or so before he received this backing. Don’t quit the day job for the first 5-10 years as it will make things easier.
It’s all about decision-making – the right decisions at the right time.
Making a profit is not a problem, whether John makes a profit off someone else or someone else makes a profit of someone else. John is also confident in his abilities.
You always need an angle and when lots of people catch onto them, you need to find another one. You have to re-invent yourself every couple of years. One of the most experienced, if not one of the most successful is how John describes himself.
Tips to emulate John.
It’s easier to buy say 5 properties and make money than just one; this gives you more exit options to make money.
This is a different league where more hard-nosed investors operate and understand how the business works.
A 5% to 10% profit is not enough, netting 20% of total cost should be a minimum to do your deals safely and securely.
John’s 3 ‘Unbreakable Rules’:
- If he can’t resell straight after buying for a profit, he won’t buy it.
- If he can’t buy refurb and sell with a profit, he won’t buy it.
- If he can’t buy, refurb, let and refinance and get most of his money back out, he won’t do it.
You have to be disciplined…even if that means not buying for 9 months.
You need to see an angle that other people have not seen to add value.
Buy subject to planning is a ‘free-hit’ really.
Understand how to pull together property deal is also required…you need to project a profit to protect yourself.
Where you invest is important – last to go up in value is nearly always the first to go down as well!
Infrastructure investment – you can anticipate the growth BUT don’t price this into your purchase price.
Successes and failures
The tower block in Ipswich in 1976.
Show me a property developer that has not made a loss and he will show you a liar.
If one goes wrong, deal with it, sell it and take the loss ready to go again…don’t try and sit on it.
Property is a long game
Being involved in different income streams, property-related can be a good thing to do. Fine and country (EA), Auction House UK, property trading and property development.
Every year we are getting closer to the next recession…6-7 times salary borrowings usually means a big problem (currently at 5 times). If a Labour government, this may lead to a problem, if Conservatives get in, perhaps 3 years away from recession.
Have a balance of income and capital, trading and investing.
Connect with John Howard…
T: +44 (0) 7921 529 224
E: info@johnhowardpropertyexpert.co.uk
Connect with John via LinkedIn
Web: www.johnhowardpropertyexpert.co.uk
Seminars running in September!
The Property Elevator Show & Property Question Time on Sky Channel 189
Also, a regular poster on Property Tribes
Remember, if you want to talk about anything from today’s show, or just talk property investing more generally, email me at podcast@thepropertyvoice.net, I would be happy to hear from you! The show notes can be found at our website www.thepropertyvoice.net
All that is left to say, is thank you very much for listening once again this week and until next time on The Property Voice Podcast…it’s ciao-ciao.