Dear Blue Bricks Magazine,

I was down In London doing a bit of networking (Knightsbridge PPN don’t ya know!) and researching co-living / co-working environments when the interest rate bomb dropped! 0.5%? In a ‘one-er’? WOW.  I nearly spat my frappe-latte-mochachino with sprinkles all over my man-bag…

Now, I’m a seasoned, been round the block more times than ‘Jenny-from-the block’, 3 decades of land-lording type leather-faced ape so I knew this meant one thing. This was The Government moving towards an Economic Defcon-4. A kind of ‘siege mentality’ ensued, in my head at least.  A couple of days before Lockdown came, one of my three SAs (serviced accommodation) had emptied of a six-month booking. I expected my other two SAs to empty of the Eastern European contractors but they turned out to be Amazon contractors, so all good. Amazon coming to town has done Darlington a huge favour. I had devised and posted on FaceyB about my new strategy SA 2 HMO expecting to repurpose them as Mini-Mos which I only had to do with one SA. Two brothers took my empty one for £200 per week. Costs easily covered. No servicing on any SAs. The missus was pleased!

I created Bandit-Boards for strategic places around The Hospital carpark offering accommodation to key workers. That was for a couple of single lets I had coming up. I had surprisingly little response but there was another turn of good luck with Amazon requiring more accommodation for ‘Key Workers’ so they are full for at least 5 months. These needed furnishing and the workers arrived after Lockdown so we pilfered our lockups and cobbled, begged, borrowed and stole enough furniture to purpose them as SA.

Just pre-Lockdown a few of my HMO rooms had started to empty of young professionals running for the hills, or rather a cushty lockdown with Mum & Dad, to add to the four empty rooms I already had. I set about hitting Spareroom.co.uk with added impetus to see what I could fill and yeah, with Amazon coming to town the demand was there and also other young professionals getting settled in time for a work placement, who paid, but never arrived! They had signed their ASTs online and are currently in a holding pattern but still paying rent.

I co-host The Property Thing networking extravaganza with Anthony Boyce and previous to all this we had not exactly ignored, but had been sceptical of warnings that Harpreet Badwal, The Health & Safety Industry guy had given us regarding ‘no public gatherings’ in the near future. Nah, surely, won’t happen? Oh yes it did! 100%. None of that networking malarkey!

I was massively driven and put in silly hours at work to sort all this out and my own lads were flying round sorting it all too. I messaged all my tenants single let and house-share group chats to say that no-one was to worry, we had their backs 100% in this. We had time on our side and to please contact us if anyone was worried about their jobs and subsequently their rent. I’m a massive believer that as long as no-one ignored the situation we could help them, and we would know where our cashflow would be. Thanks to Boris & Co doing a sterling job of the Sterling flow we received a grant and we just paid any outstanding invoices to all and sundry so we knew we were operating from a datum point. Very few suppliers’ bills to come in and just staff to pay and the usual mortgages etc. March month end was good with 100% Occupancy and 2% paying 50% rent.

I start work really early and finish late so I’ve been self isolating in my office while my dependants, home from uni and off school, bask in the April sun. I’ve had three investors go into the inevitable holding pattern on three big HMO/co-Living/apartment projects and one investor appeared wanting to do business albeit cautiously of course. I’m going ahead with the planning gain on my future projects anyway. They take two months to get and it’s a ‘Sprat to catch a Mackerel’ for when the dust hopefully settles. Surviving the last recession and building a more robust portfolio as a result certainly helped my mindset in this one. It helps being focused on solving problems. Massive thoughts going out to those who’ve suffered as a result of this pandemic.

Much Love,

Paul Million, Real Property People Ltd

Darlington

Dear Blue Bricks Magazine,

I entered this year by far the most positive, organised and up for it than ever!

Long and short term business plan all sorted, vision board and list of big goals at the ready!

One of my main goals for 2020 was to buy, refurb where necessary and let out 6 houses, having done 4 last year I felt this would push me but still be achievable.

In January I bought a repossession at a negotiated price of £60,000, £6,000 refurb budget, £3,000 fees even allowing a bit of over spend the £70,000 mark was a happy place and as I already have several houses on that estate I knew I could achieve £550 rent for a newly refurbished 2 bed house. So a great start and everything went to plan, on time on budget and I even got a tenant lined up just before I got it finished… The dream start to the year with BTL.

While working on that house, I was viewing all over the Gateshead area and finding that houses were all getting snapped up at asking price and above, this was in February, I put quite a few offers in but they didn’t get anywhere, then one agent rang back with a deceased estate house being reduced by £10k, I viewed and tried to get it further reduced however there was other genuine interest and my good relationship with the Estate Agent led me to understand £75k was the price to get it.

I was really pleased as it was going to be a fast sale and would be timed perfectly for me finishing other projects.

However, what wasn’t in my plan for the year was coronavirus?

I was meant to complete the purchase on the Friday before Boris announced the lockdown however due to the family not emptying the house I was told we would need to complete on the Monday instead, no problem really however there was a lot of media attention about this lockdown situation coming and I didn’t fully understand the impact it could have so I took a lot more notice over the weekend and of course by Monday morning when it was all over the news I became very concerned that I was not clear on the impact this could have on my purchase and as I was using a bridge of £50k I became uncertain of how I would get trades there and even if I did would I definitely be able to get materials?

Going with my gut I no longer felt comfortable so I rang my solicitor by 11am and said I am not pulling out of the deal but I want you to tell the other side I want to put it on hold until the coronavirus and the impact it may have on us  is clear, and please explain the reasons why. I have always found that if I’m in doubt it’s better to do ‘nowt’!

So ‘nowt’ it is, I am watching and waiting and taking an overview of the entire situation and until I know I can develop and invest with confidence in all areas that play a part in my business I am on hold.

All my rentals have paid me without a problem or without up to now asking for a reduction so all the hard work I have already put in over the years has paid off and other than minor maintenance issues I can deal with either outside or when people are out of the properties I am spending the coronavirus time with my Sons and continually educating and developing myself.

Being realistic I am not going to achieve this year’s goals in the time frame originally set , however I will still achieve them, I have no doubt about that!

I have had many, many outside influences cause all kinds of problems to my business over the years, I just see Coronavirus as the latest problem to get around and after this has all settled down there will be some other problem crops up, you just have to keep monitoring the situation, make informed decisions and carry on, sometimes in a different direction but you must carry on when it is appropriate to do so.

Stay safe  x

Thanks

Rachel Tasker

Northside Homes Limited 

Gateshead

The Covid-19 epidemic has tested everyone to adapt and change their businesses accordingly.
I’m no different. Having built up a large portfolio over the years, I diversified into short stay lets or Serviced Accommodation about 9 years ago. The main market is contractors working in the area either full time or Monday to Friday.

Quite a few left shortly before lockdown was announced but others stayed on.

When it was announced that all hotels had to close, I knew there was an opportunity to fill some empty properties.

I had been dealing with Redcar council over the years and helping them with short term accommodation for the homeless and domestic abuse section. Having properties in 6 different local authorities made me realise all councils must have the same issues.

I contacted most of them around the 26^th March with various degrees of success.

Stockton called me within half an hour of my email and took 2 houses for a 3-month period. 

Durham initially took 2 ground floor apartments for wheelchair users as they said “At 11 o clock tomorrow morning the hotel is closing and they would be basically wheeled out into the street with nowhere to stay” Since then they have taken another of my houses for a vulnerable family.

In between dealing with the councils I had been accommodating a Spanish company working on a huge project in the Middlesbrough area. They thought they may have had to either send the men home or just stay in the houses. As it happened, they have continued to work. Not only that but they have brought in further workers. I did still have some empty houses but when they were full, I had a bit of a dilemma.

We had just finished converting a 3-bedroom house to a 4 bedroom with 2 additional bathrooms. The problem was getting it furnished. Luckily, we had started storing furniture in readiness of this. So, with a bit of organising (including me taking a delivery of a fridge freezer and washing machine at 7.15 am) we got it finished.

There was another house which had recently been decorated so I decided to do the same again. Beds were picked up by one of my guys, he also managed to move a 3-seater settee on his own. Another delivery of washing machine and cooker taken in by yours truly, again at stupid o clock on a Monday morning. It’s all done ready for the next contractors to arrive (whenever that might be).

Which leads me to my final story.

I agreed a lease option purchase for a house next door to a hotel I own in Seaton Carew about 5 years ago. It’s a large house over 5 floors. We tanked out the basement a couple of years ago but didn’t do anymore than that.
As nothing was happening and it was empty, I contacted a contractor friend of mine to see if he would like to do some work. 

He went to see it and agreed to start work after Easter.

Work is well under way. We are converting it to 9 bedrooms with 5 en-suites and 2 shared bathrooms. There are 4 of them working on it but working independently, painter, electrician, joiner and painter. When finished I’m looking to rent it out as full building rather than individual rooms (as that would require a change of use with planning) for around £200 per night.

The moral of the story, I guess, is to try and adapt and change as quickly as you can with the circumstances presented to you.

SA, in my opinion, will only get more popular once things start to return to normal. 

Why stay in a hotel when you can have all the comforts of home for the same price?

Yours Faithfully,

Duncan Belton

Nest Egg Homes

T: 01642 880030