Comments on: Welcome to the £1m Lease Option Challenge!

By: cheap mbt

cheap mbt — Sat, 10 Jul 2010 03:09:08 +0000

I really love the topic that you shared. Thank you for posting.

By: Robert M. Equity

Robert M. Equity — Wed, 23 Jun 2010 08:39:38 +0000

I do not swear, I do not smoke and I do not drink ! O damned My sigarette has fallen in my glass of beer …

By: Richard Shepherd

Richard Shepherd — Wed, 14 Apr 2010 20:05:44 +0000

Hi Ryan,

No worries – people sometimes do get tripped up here.

There are 3 ways of making money.

Upfront: tenant buyer gives you a fee for the option to buy the house in 5 years time!

During the middle: You pay the landlord £300 per calendar month for the property and ‘rent’ to the tenant buyer for £500 per calendar month. In addition, the tenant buyer pays a top up of £200 per calendar month. So here you are making £400 per calendar month.

End: When the tenant buyer buys the property. You have an option to buy the property at £110k. The tenant buyer has an option to buy at £135k in 5 years time. Lets say they paid you £5k as the Option fee up front, and £12,000 in top ups. This means that you still cash at at £8k when they buy the property from you.

So your total profit is £5k up front + £12k (rent) + £12k (top ups) + £8k Back End = £37,000.

Hope this helps.

Richard

By: Ryan Surgett

Ryan Surgett — Wed, 10 Mar 2010 11:35:32 +0000

Hi all,
Apologise if I’m being a bit thick here, just a query regarding option deals with landlords. Firstly, I’d like to say a huge thank you to Phil – I felt his role play during teleconference 2 was superb and provided invaluable no-how regarding how to approach/negotiate with landlords. However, the aspect I’m struggling to come to terms with is how you make your money in the deal. I imagine the example we were provided with related to a sandwich option due to the pre-agreed tenant stay etc and set purchase price. What I can’t seem to grasp is how you make your money from the deal, for arguments sake let’s say the agreed purchase price is 100k. The tenant buyer then purchases the prop from the landlord in the duration of the lease for the set price. So how do you as the investor make any money from the deal? Also, is it not possible to use a purchase option in this scenario to build your own portfolio? Again, Apologise if I’m being a bit thick here but I’m struggling to come to terms with the proposal. Any help would be much appreciated, many thanks
Ryan Surgett

By: Peter Bright

Peter Bright — Tue, 02 Mar 2010 20:13:52 +0000

Hi Gavin and viewers,
Haven’t posted for a couple of days, partly as I was in Spain, but also because I’ve been busy on the day job and then making calls – too knackered after dinner to come on here and update.
Anyway, have a coupleof deals kind of simmering, not sure how far they will go, check out my post on the main forum.
Is everyone so busy building there portfolios? I am definately intent on making this work – at the moment I feel I am failing my way to success – which is good !!
gavin, keep your chin up and keep at it!!

By: gavin

gavin — Wed, 24 Feb 2010 21:50:37 +0000

Hello Peter, or is their anybody else out there?

How has it been today? Personally it has been a bit crap with not really taking any steps towards the goal, well that is how it feels, so let me recap. The letters were posted, the planning dept were emailed reference TPOs, as yet their is no sign of any planning application being made on the plot.
I will just digress if you don’t mind, I had a call today, somebody trying to sell me marketing space for the building business on a folder that planning documents are sent out in and whilst chatting to her I mentioned that I had direct mailed planning applicants for a time and didn’t get much out of it then I mentioned to her that I’d had a company offering me a direct mail service, and that I listened to the salesmans script before politely informing him that I had done it for about 6 months and followed up some of it to be told that either word of mouth or the architect had sorted the builders. To which he said where did I get the planning register from so I told him that anybody can look at it online and the meeting ended. I found out from the previously mentioned lady that their are coys similar to the direct mail coy selling that free info to builders for £1000s “cheeky bastards” I thought. Oh god and I did digress
Back to todays efforts have just finished hand writing on
A5 flourescent card, a property disposal script and on the back a script directing vendors to peel the sellotape sticky fixer and stick it somewhere safe. Time will tell.

Oh and I think I unintentionally offended somebody on the forum today in a lead/deal selling thread.

Til tomorrow Gav

By: Peter Bright

Peter Bright — Tue, 23 Feb 2010 22:52:24 +0000

Another late night for me, I think 9pm is too late to call or is it? I can’t decide?
Anyway went on gumtree today and a couple of other sites, sent some emails and will follow up on THursday pm while waiting for my plane home.
Still have to call my friend in Harrow about his props – will do that tomorrow.
Keep you posted.

By: gavin

gavin — Tue, 23 Feb 2010 22:48:08 +0000

Hello all,
I have just finished putting about 40 letters into envelopes to about half of the properties I singled out from yesterdays time spent looking on line and who’s street number I found out by taking long ways to and from work today, but the post office would only let me download about 15 post codes but the rest are going anyway.
As of the agents I emailed yesterday with the delayed completion script I have had a total of 0 replies.
Have made some calls from local paper and have a landlord quite excited about it all, as the flats in question are not in a very good area and apparentely her current tenant is leaving due to another residents constant behaviour so I may have to pass on that, but I will go and have a look tomorrow.
Have also come across whilst driving off of my regular track an agents sign on a 0.4 acre plot with what is allegedly a 6 bed detached on it but it looks to me more like a 10 bed it is absolutely run down if not falling down the agents are marketing as development potential but I have a suspicion that the trees that stand on the plot will have TPOs on them limiting the GDV of the plot. If it was any good I feel that it wouldn’t have even made the agents shop window. I will have to do some research on that.
Gav

By: Peter Bright

Peter Bright — Mon, 22 Feb 2010 23:49:10 +0000

Hi Gavin,
True to your word I see, good man. I am fully supportive of your suggestion and I too am happy to share my progress on here, or wherever the Team suggest we should do it.

For my part, today I made some more calls, got knocked back on 2 didn’t even get to talk about the prop!! LOL.
Then spoke to very sweet old dear, seems I was about 6 weeks too late, she just sold off 10 props and didn’t want to sell the remaining portfolio. [If only I had been on the workshop in October] Finally, got to chat with a guy renting a house in Harrow, he’s moving to the USA but wants to keep a prop in London, has a 2nd in Hatfield. Ive sowed the seed for him on doing a LO with me over the term of the mortgage, now he needs to chat to the wife and tell me which one they will do the deal on. I hope it’s the Harrow prop – why [I'll tell you later if it comes off]

I made 10 calls, contacted 4 people, but by the time I got of the calls it was 8pm. Question to the Team – how late is it considered acceptable to call?

By: gavin

gavin — Mon, 22 Feb 2010 18:26:02 +0000

Hello everybody and thanks for a great weekend. I certainly learnt loads aswell as meeting some great people, some of who agreed to doing it all live, by which I mean regularly posting thier latest moves towards LO portfolio/deals along with any questions and answers they may have for other attendees sharing what has/hasn’t worked for them.

Question for our mentors, would it be possible to do the above as a kind of mini private forum just for us? maybe with the headed grid for us to show our deals on, with somewhere for us to give a brief description of the deal so that we can recieve input from other members, who knows even in excel, is that possible?

Question for attendees who else thinks that all of the above is something that they could work with, and would they find it helpful for us all to to share our daily efforts ?
As for me, today I have been on http://www.home.co.uk looking for properties that have been listed for some time. With this site you can find street name of property along with lots of info about it. If the photos have shown an empty house I have emailed agent with a delayed completion script telling them that they get payed at exchange. If looks lived in they will get direct mailed tomorrow. So again thanks everybody for a great weekend and let’s keep the momentum going.
Til next time Gav