- Today let me share with you,
how I found my first ever truly below market value deal,
where I got a 29% discount below the market value.
I wanna tell you how I found it
and I wanna give you all of the numbers,
so that you can start doing deals just like this.
(light music)
Hi, my name is Tony Law from Your First Four Houses
and I teach people how to put a small property portfolio
that generates a great income for them,
so they can give up the day job if they wish
because they're now financially free.
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So the truth is, I never used to believe
that I could properties truly below market value.
I mean, why would anybody sell their property
truly below market value,
and importantly, be really happy to do so.
But I'm delighted to say
that I've actually done this now many, many times.
But I wanted to share with you
my first ever below market value deal,
so you can see exactly how I put this thing together
and hopefully start finding and doing deals
like this yourself.
By the way, stay tuned until the end
because I'm gonna be sharing not only how I found it,
but all of the numbers as well.
So this is my first ever below market value deal
that I bought in Poole back in 2011.
It's nothing particularly special,
it's a semi-detached house in an okay area
in the middle of Poole.
I found it using a strategy I call Street Level Networking.
Now I've talked about Street Level Networking before,
essentially in simplistic terms, you get out there
and you walk around your investing area.
There is a bit more to it than that,
well quite a lot more to it than that,
but in an essence you out there
and you start walking around the area.
And when I did this, I actually met a person
who was literally standing at the end of his drive.
I got chatting to him, I initiated the conversation,
I'm really speeding this process up,
but in an essence we had a cup of tea, we had a chat,
in fact we had a series of chats, and I negotiated the deal.
The seller's situation was
that they dearly wanted to move back to Wales,
which is where they're originally from.
But the problem they had was that the house was a real mess
and they couldn't find a buyer.
To be really honest with you,
they were a lovely, lovely couple,
but the house was a genuine mess.
I mean they had loads and loads of dogs,
the dogs weren't getting out of the house,
there was literally dog mess throughout the house.
That gives you an idea of what I walked into,
and so can you understand?
Of course you can understand,
how sellers or potential buyers are walking into this house
and they were kinda turning around
or walking straight back out again.
So the solution I offered up
was an exchange and delayed completion,
which is in essence exactly as it sounds.
You exchange today and you delay the completion point
until a little bit further down the line.
Now why is that an advantage for this particular person?
Well it meant that they could go to Wales,
they could find a fantastic opportunity,
a fantastic deal, in Wales and the agent would listen,
the agent would submit their offer
in the full knowledge that they had an exchange
that was actually happening.
So he put deals in front of them
that he would maybe not have been willing
to put in front of people
who were less in a proceedable position.
And in actual fact, this particular person
found a fantastic opportunity in Wales
and I actually interacted
with their particular agent as well.
I'm making this sound far more complicated than it was,
but it meant that they got a fantastic deal
and I know they wouldn't have got that where they not
in this exchange and delayed completion scenario.
By the way if you find this video in any way helpful,
I would love it if you could click on
that like button down there.
It really helps me, if that's okay.
Okay, so what about the numbers now?
Well because of the state of the place,
we agreed a purchase price of 110,000 pounds.
My refurbishment and other associated costs
came to 25,000 pounds.
Now admittedly, because I'm a carpenter by trade
that's where I originally started out,
I did do quite a lot of work on this place myself.
I brought in trades to do it, but yes I was on site,
I was doing quite a lot of the carpentry aspects
to the site.
Certainly I was sweeping up at the end of the day,
and I was making the teas and buying the Subway lunches.
But I loved doing all of that!
I'm really comfortable in that zone.
So my all in costs came to,
once I added these together, 135,000 pounds,
but the market value, the genuine market value,
at the time was actually at around 190,000 pounds.
So my profit upon completion
of all the works was 55,000 pounds.
After I refinanced this particular property,
I was able to pull out all of my money.
All of the money that I put into this deal,
and so if you work out the return on investment
you'll find that that was actually infinite.
By the way, if you're not sure exactly
how to calculate return on investment,
can I suggest you check out this video here
where I explain how you do that.
And so the value today on this property is 280,000 pounds,
and there's a fantastic tenant living in there
and I'm gonna be keeping this property forever.
Now the important bit I wanna get across here
is that I know I wouldn't have found this property
had I not been walking around my investment area,
and I know I talk about that a lot.
So please, make a commitment
to walk around your investment area this week
and talk to the people in that area.
Talk to the person who is the corner shop,
the owner of the corner shop,
they know what's going on in their area, they certainly do.
Engaging conversations,
keep your eyes open for opportunities,
and I honestly you will find something
the fantastic deal this week.
In my completely free property mini-course,
I teach you how to find deals just like this one.
To enrol simply click the link here
or the description box below
and I'll start sending those lessons straight out to you.