In this special chat with finance expert and property investor Rob Holmes, David finds out about some of the strategies that have made him so successful, including valuable insights into some of his most ingenious deals, and what made them work.

Rob is a supporter of using bridging loans in order to take the best advantage of property deals. In this episode, he explains why and gives personal examples of how they work & how they’ve worked for him.

 

KEY TAKEAWAYS

The importance of having a good team around you is vital. It can allow you to be able to move more quickly on potential deals. Rob gives a great example of this in an early anecdote, in which he also explains a strategy that worked for him on an auction property, as well as the potential pitfalls.

 

• If you’re looking at a buy-to-let, it’s always wise to look at the gross bridge and the net bridge amounts, because it’s the net bridge amount that you’ll be putting in your pocket towards the purchase.

 

• Rob talks about the importance, reality and value of bridging loans - A lot of people are scared of bridging, but mainly because they don’t understand it. Rob advises that bridging can land you in trouble if you don’t understand your deal properly. Bridging is very quick and isn’t as expensive as many people perceive it to be. There are a lot of variables that a lender will take into account, mainly based on you as a borrower.

 

• Entry and exit fees - Rob advises that many lenders these days do not charge an exit fee for a bridging loan. If you are paying one, then it might be a good idea to shop around to see if there’s a better deal out there. An entry fee is standard, but those fees can be subtracted from the gross loan and will be deducted from the money being lent, so you don’t necessarily need to have capital upfront to pay this fee. So adjust the amount you’re asking for to account for any fees.

 

• In an open market value bridging strategy, you are obtaining lending against the true market value of a property, instead of the agreed purchase price.

 

• Meet the valuer when he comes back - every single time. Always meet your valuer when he comes back to value your property after a refurbishment and prepare a pack detailing the effects of what you’ve done. A fascinating anecdote from Rob’s history explains exactly why.

 

• A cross security bridging strategy can also be beneficial. This is where you obtain the net bridge against the property you’re buying, and subsequently take a bridge against another property, essentially creating a bridge across two properties, where one property makes up the missing money needed to buy the first.

 

BEST MOMENTS

‘You’ve got to be in it to win it’

‘Relationships are key in a lot of things’

‘Know your area’

‘Half an hour can cost you five grand!’

‘It’s important to have a good broker that can get you access to all the good lenders’

‘This is a little bit ninja and you need people who know what they’re doing’

‘Always meet your valuer when he comes back’

‘Even though a property can be unmortgageable, bridging companies may work with it’

‘Closing a huge property deal in a pub garden is a very good place to be!’

‘Look at your low-end values, cover your downside’

 

 

VALUABLE RESOURCES

Property Sourcing Profits Podcast

10X Property Super Conference - London

 

 

ABOUT THE GUEST

 Rob Holmes became interested in property investment after reading ‘Rich Dad, Poor Dad’. Rob began to educate himself in the field of property investment and bought his first investment property, a two-bedroom flat, at the age of 20.

Since then Rob has continued to build his own personal portfolio around the South East worth over £1,500,000 by the age of 30. Further to this, Rob also has other Joint Venture property held worth over £1,000,000.

Rob strengths are in creatively structuring investment deals and high cash flow strategies. Most recently structuring and negotiating a triple block purchase, comprising of 14 units of mixed commercial and residential property for £950,000. Rob specialises in utilising bridging finance in creative ways to make deals happen and helping others to do the same.

 

ABOUT THE HOST

David is a property expert with over 25 years’ experience and his own portfolio of 26 units. His current rent roll is in excess of £10k per month. He is also a partner in a Deal Sourcing and Packaging business in the North West of England and has sourced over 250 properties for investors since 2004. In recent years he has, by necessity, had to develop an expertise in LHA strategies.

This area is increasingly becoming a niche for him, and he enjoys empowering other landlords by sharing the knowledge he has gained. The ultimate purpose when sourcing properties in this sector for investors is to minimise risk while maximising profit. He has had to find answers to the challenges of Tenant Find, Management, ensuring rents are paid and the transition to Universal Credit.

These are strategies he uses in his own business and also on behalf of investors. His investor clients regularly achieve annual gross yields of over 20% with high occupancy rates and voids resolved, sometimes within hours.

 

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