Help needed..Sell & Rent back Schemes??

paulcummo

realwildone wrote:

Get real. Thats not the way to base any business. You can buy much cheaper properties from auction. We are currently buying and have offered 20% and 10% less on all the properties we wissh to buy and 2/3rds have accepted. You could not base a business on purchase of 10% less than marketvalue. You can get that now.

I'm so glad you've come on and saved me from a terrible financial disaster. I will no longer offer my 90%, but will instead take 10% off like you do. Thank you again.

As Prudryden said It's a different business than yours. Ours is a long term plan for the future. Our business is additional to our careers. Our tenants are all very long term and happy. In any business, happy customers are key. I concede we probably make a bit less profit per property, but we find a bit less multiplied by a big number
is often better than a bit more multiplied by zero. We just don't get voids as we are not greedy.

I wish you success with your auction business. I too looked into auctions but decided against this as my research showed me genuine bargains are becoming more and more difficult to find as the auction rooms are full of amateur bidders paying far too much but thinking they've got bargains.

scrumymummy

ooh I'm keeping out of this one!

realwildone

You misread this. I do not buy from auction, neither do I have a property business (anybody that buys and sells property now is either a daytime telly watcher or a fool).

I am currently buying a property for myself in what is at the moment a buyers market. I was mearly pointing out that you can buy ANY home you want to at between 10 and 20% off the valuation.

Basing a property business on buying peoples homes at 10% less than valuation is foolish and is no different than a bookie offering double the odds on a favorite. Sooner or later you will go bust.

Its madness. Its not enough.

sydney2002

scrumymummy wrote:

ooh I'm keeping out of this one!

Did you get sorted with your rentback?
I sent you a personal message, not sure if you read it? Explains our issues and how we got out. If got quesitions just send us a message, and goodluck.

paulcummo

Hello again. Lets not get into a silly slanging match, but I would like to point out a few minor flaws in your arguments, as I think they may be beneficial to you.

Firstly, It’s probably not wise to advise people on the merits of purchasing from auctions only to state in your following correspondence that you do not purchase from auction as this could be deemed contradictory.
It’s possibly also not the wisest move ever to completely slag off a business model when you do yourself state, you do not run a property business.

From what I can gather, you are about to purchase your first home. And good luck to you. I’m guessing/hoping that as you are purchasing only one property, your 2/3rds accepted was two out of three offers, else there are going to be a lot of not so happy vendors and estate agents.

The one thing you’ve said that drove me mad was the barbed comment
“anybody that buys and sells property now is either a daytime telly watcher or a fool”

Comments like this are what stand you out as an opinionated amateur. People who use the “daytime telly”, or “Sarah Beeny brigade” to have a pop at people, are usually people with extremely limited knowledge trying to look clever.

The true professional uses every source of information and encourages others to do the same. The true professional also knows that there is never a bad time to purchase the ‘right’ property at the ‘right’ price in the ‘right’ location, as they ensure they make profit whatever the direction of interest rates or property prices. Only fools can only make a profit in a runaway market.

paulcummo

Hi

Keep us updated with how you get on. Really hope you sort yourself out. If you want any advice then please ask away and if we can give you any pointers, we'd be glad to. Sorry for getting a bit sidetracked, but that's why I tend not to bother with Forums, as the people with nothing positive or helpful to say drive me mad. As you may have noticed, I end up letting myself get dragged in.

catewithers

At the risk of getting caught up in this row - which I have no wish to do - I just want to say that your business sounds like a dream come true for people in my situation, Paulcummo.

It's nice to hear that there are people out there who aren't just looking for as much profit as possible in as short a time as possible with no regard for the consequences for anyone else.

If you ever fancy investing in Bristol let me know!!!

Cate

paulcummo

Hi Cate

It's so nice to hear positive things from Yummy and now yourself. This convinces us that what we are doing both has a market and is the right way to go. We currently only purchase in North Manchester and are about to roll out on a slightly larger scale here. But I'd never say never. Drop me a personal line (I've no idea how to do that I'm afraid) and I'll send you the brochure I've been preparing for the last 3 months and which we are just about to use in a localised drop. This explains what we are about. I could quite easily give you some rough figures based on your postcode and street name.

This now looks like I'm on here drumming up business, which I'm not. But maybe someway down the line I should be!!!!

clutton_2

""paulcummo "" Our business is additional to our careers. Our tenants are all very long term and happy. In any business, happy customers are key. I concede we probably make a bit less profit per property, but we find a bit less multiplied by a big number is often better than a bit more multiplied by zero. We just don't get voids as we are not greedy."

absolutely spot on - exactly my own business model !!!

HelpWhereIcan

Reading paulcummo's and clutton's points make me more sure about the need to try and find a private individual as opposed to a company.

Although they dispute the finer detail and figures, they both have property ownership as a sideline and are looking for long term investments so are able to look at their tenants as people rather than numbers.

Neither though is really comparible to a buy and lease back company and I will try to explain why.

My customer's plight prompted me to think of offering something similar to paulcummo and I investigated my options for buying at 90% value and renting it back to them. The figures worked and I was all ready to go if the remortgage did not go through in time to save the repossession. Not needed in the end, but it (and paulcummo) showed that it is perfectly possible to do on a relatively small scale.

A company looking to do it as a full time occupation faces different issues though. The way they finance their purchase is very different. They have staff to pay, overheads to cover etc and are therefore more focussed on cash flow, hence the pressure on them to get a large turnover of properties and as big a margin as possible.

Most offer the rent back option as a sales incentive and I would guess that most have no intention of the tenancy lasting more than the min 12 months when they have so much capital tied up in a property tenanted by someone who had problems paying a mortgage and may run into difficulties with the rent before long.

You also have to bear in mind that many of these properties will also be in less desireable areas and companies will want to reduce their overall exposure to the property market in any one area.

While paulcummo and clutton have hounourable intentions, they are no comparision to the multi million pound companies who have been doing this since the early 90s who have different objectives and pressures.

I actually think paulcummo does himself a dis-service if he thinks he is.