On A Mission

Property Investor on a mission – Jan Martin writes from E15, London.
December 2007

Dear Diary,

This October I was made redundant. (I must add, voluntarily, after toiling away in the world of crime for the past 21 years. The job was changing out of all proportion: years of government edicts, changing focus, new visions, jargon beyond any reasonable comprehension, then a swift and vicious cull of various levels of management – including mine.)

I could have stayed and fought for a job where I would do three times as much work (and be run ragged for the same money with no particular job security.) Well, it didn’t take too much deliberation to decide enough is enough, time to jump ship, and retain some semblance of sanity in this mad world. I opted to go, safe in the knowledge that there are more interesting things to be getting on with.

My decision was sealed as a result of having dabbled in the property market since 2003. So now there’s a nice sum in equities building up to provide a financial buffer for this recent turn of fate. Anyway, an opportunity of potentially massive proportions presented itself a couple of months ago…

How did I get here?
But first, I should explain (before launching into the diary) how I came to be where I am today…

In 2003, issues at work sent me off to check out other lifestyle options. Being interested in property, but naturally cautious, I went to a seminar or two on the subject of “how to get rich and give up work”. I didn’t quite go that far…

I went back to work part time so there was still money coming in. What I did was release equity from my house, on which there was only a small mortgage. Having bought well, I had plenty of equity to play with. Of course, what I released in cash all had to be paid back in a bigger mortgage, so I picked a sum I was comfortable with.

With this sum, I bought three more houses and enjoyed a profit share on a fourth house by investing money for a friend. This cost me just £60,000 and 6 months of investing.

My investment properties
House No. 1 was a 2-bedroomed Victorian terrace in London, newly refurbished by a local builder and sold on. It was virtually a new house, which let easily and, being on my doorstep in E15, was a very useful study in seeing how buy to let worked.

House No. 2 was a very interesting prospect, north of Manchester. It was bought via a search agent, purchased unseen, and has proved a remarkable stroke of luck. The house was being offered for sale by an elderly couple who needed something smaller but hadn’t yet found it. So I bought it from them and they rented it from me for the next six months – an ideal solution all round.

Now, this was at the time when properties around Manchester were being snapped up for a song and there was gazumping-a-plenty. My vendors were true to their promise to sell at the price we had agreed, despite being offered a sum in a brown envelope on their doorstep by someone they obviously didn’t take to!

When they found their ideal home, they moved on. I made some improvement plans and got the builders in. It was a real Coronation Street house, but amazingly tardis-like inside with 2 reception rooms, a small outdated kitchen, 2 bedrooms and a bathroom the size of the master bedroom – what an opportunity!

So, the builders set to work. We put in a new fitted kitchen, taking in an un-used utility area, added central heating, re-worked the bathroom into a family-sized space, created a third bedroom and decorated throughout.

This was all way before the mass of property shows on television – or I might have consulted with Sarah Beeny! The house has been let almost entirely since, with a minimum of void periods, achieved by good relations with my local letting and managing agents.

The house I got free!
House No. 3 – this is the one I got free! A friend had been made redundant with cash to spare, so she came to me to invest it for her. So, following the previous formula, I bought up north again building myself into the deal as a share-holder in the property. This time I invested in a 3-bed terraced property, not a particularly pretty house, but as a business prospect the sums added up, so it went into the portfolio!

House No. 4 followed hot on the heels of the last – another 3-bed terrace in a nearby street: same set up and same rental potential.

Each property has been successfully let and the rent has (mostly) covered the mortgage re-payments. There have been some maintenance issues, but planned contingency funds have covered those. Five mortgage hikes in 2007 were somewhat uncomfortable, but as house prices in my chosen areas continue to rise, it will even out in the end on the side of profit.


Use resources like Sq Ft Magazine
Along the way, there has been much research and sharing of news and views with friends and colleagues in the business – invaluable to stay ahead of the game. Square Foot Property Investor Magazine has proved a useful resource: check out www.sqftmag.com

Invest in Istria
Now there is talk of syndicating with more friends to purchase at home or abroad. My current research focuses on Istria, Croatia, on a beautiful stretch of coastline across the water from Venice. At present, the area is not over-developed, but plans are in place to create a 5* marina. So a recce is planned in March 08 to check it out and meet up with the regional regeneration agency and Croatian friends who will act as my agents.

So, back to now – how will I spend my spare time? Research, research, research of course. Then let’s see where it takes me.

Investing in E15
The other major advantage to my property investment plans is that I’ve been investing in the part of London that is set to become a world stage in 2012 – Stratford, East London.

This area has been home for a long time now, and it has been amazing to see the changes so far and to be involved in what is to come. Stratford City is on track to become the largest business district to rival Canary Wharf, with interest from around the world for prestigious new head offices.

We have the prospect of a 2 hr 15 minute journey to Paris or Brussels with Eurostar coming in from St Pancras – a day out shopping will take on a whole new dimension very soon - fresh croissants on the Rive Gauche. In addition to the Games, Stratford will soon house the largest retail outlet in Europe. (Lakeside and Bluewater will pale in comparison.) So can profit still be wrung from E15? Yes, if you know where to look. (Which I do!)

Coming up is a specialist trade show on overseas investment properties which will be of great interest, I look forward to that and will report back.

More soon,

Jan