Christmas is a time when the property market comes to a rest. There is a lag period when both the rental and sales market stagnate. People go into a different zone. There are multiple invites to Christmas parties. This is when deals slow down, valuers, solicitors and mortgage brokers start to wind down, all affecting how quickly you can get a deal through. This is the environment in which the astute investor needs to be purchasing. In this backdrop, auctions are a good platform to pick up deals from. The closer to Christmas the better your chances to pick up a deal.
A few years ago, we found ourselves on the wrong side of the auction room in such an environment. This was during the Olympic Games in 2012, which was also compounded by the Queen’s Jubilee. The population was busy feasting and drinking. There was only a skeleton attendance in the auction rooms. Lots had to be sold, but the public wasn’t coming in. Auctions are used by sellers who want the security of a sale. An offer, and putting it in the hands of lawyers, is not the same. You could do this multiple times and still not have the security of a confirmed sale. Instead, just a large legal bill.
Auctions provide certainty. Hence, we put two lots in the auction. One large property in Shepherd’s Bush consisting of three flats, and the other a freehold building in Harlesden; both great deals for the buyer. We left plenty of meat on the bone for the incoming purchaser. We are considerate that way. Our angle was, we had exchanged on the properties but not completed. The completion was set six months away or earlier at our discretion. Therefore, the aim was a quick in and out, without even so much as a clean up. Both were great deals, as evidenced by the eventual sale price.
We did not foresee the effect of the Olympics having on the auction room. When people drink and watch games, they are in no mood to focus on getting deals done, the next day the edge is gone. You will have a similar effect leading up to Christmas. For the shrewd sober investor, this is exactly the time to exploit the situation. There are auctions on the 12th, 13th and 17th of December 2018, by Auction House, Allsops, and Barnard Marcus being the last one of the year. These are all sizable auction houses, and therefore will have good stock to sell. The key is to ensure all the homework is done well in advance.
This is a risk, as homework costs money, and you may need to kiss a few frogs before you get to something which stacks up. Therefore, it is essential all the commercial due diligence is done prior to having the solicitor check the legals, as his/her clock will be ticking. This time round, you have the Christmas effect compounded by the uncertainty caused by Brexit. A rare combination of events, and a perfect time to exploit the market. Do get in touch for further information.
Agony Agent Is Here To Help!
Q: How do I protect my tenant’s deposit?
A: A deposit is the money taken by the landlord to cover any damages or rent arrears that arise from the terms listed in the AST. This deposit should remain untouched for the duration of the tenancy.
There are three main schemes available for you to use: the DPS, TDS and mydeposits. Each of these schemes offer practically the same service, but each has their own individual qualities suited to your needs and requirements.
You must keep in mind that protecting the deposit is time sensitive, and must be done within the first 30 days of receiving the deposit. You will need to give the tenant the scheme's prescribed information that will be sent to you when you have protected the deposit.
Be warned, if you do not protect the deposit you may be fined and will be unable to serve a Section 21 on your tenants. Some landlords have found themselves in this situation.
Depending on which scheme you choose to use, you will need to provide certain information which will include details of anyone that paid towards the deposit.
Fines for not protecting the deposit or providing the prescribed information within the 30 days of receipt will leave you liable to pay the tenant between 1 and 3 times the deposit, along with a court ordering you to return the deposit.
Acting beats reacting
The other day I was walking to a meeting in Central London. I was absorbed in my own thoughts when, suddenly, I heard an aggressive noise being made by a nearby driver repeatedly sounding his horn.
The excessive use of the horn and the unexpected sound startled and annoyed me.
As my state of mind shifted I became aware that my mood had changed and I was no longer absorbed in positive thoughts. Urban living is often stressful and, without realising it, we can catch a mood from someone else. After a couple of minutes, it occurred to me that I was “reacting” inside of me to the “actions” of the aggressive driver. This prompted me to contemplate the word “react”. This literally means to “re-act”. In other words, when we react we repeat the actions of another. Externally, we may do something different to the person we are reacting to, however, we are responding aggressively to aggression or impatiently to impatience.
We often recycle the behaviour of others. Most of the time this state of reaction is so automatic we do not stop thinking about it. We just react thinking we are acting. However, to “act” means to think and examine your choices before doing anything. Once the choices have been set out then action can be considered within a broader context, without the compulsion to continually recycle another person’s energy. And, the secret of someone who has mastered this is that s/he appreciates that taking no action can, sometimes, be a powerful state of action.