£2000 Cash Flow from 1 R2SA deal

£2,000 cash flow from one single Rent-to-SA.

Listen to this episode to discover how I sourced it, how I’ve calculated the figures and how you can find your next SA deal….

The property I’m going to discuss in this episode is a really recent deal of mine.

This deal proves that sometimes all it takes is one deal to transform your life because the majority of people I speak to, their initial targets are £1,500 - £2,500 a month to hit the milestone of leaving their jobs.

I want to be clear; however, in this episode, I’m not selling a dream. Instead, I’m breaking down one of my recent deals and breaking down the figures so you can see exactly how it works.

The property is a two-bedroom, two-bathroom, located on the outskirts of Derby. It has some great local amenities, a supermarket, a large hospital and convenient transport links. The best thing about this property is the standard of accommodation, and it’s basically a new build.

For this property, you will attract business, corporate and construction guests. Other tenants could include families locating back to the UK or families in the middle of a house move that needs somewhere to tide them over.

Interested to see the financials, how I sourced the deal and how I marketed the property? Listen to the podcast to find out more…

Podcast Transcript↓

[00:00:00] 2000 pounds cash flow from one single rent to essay on this podcast. I'm going to break down exactly how I sourced it, how I've done the figures and how you can get one of these bad boys. Two plus, if you miss last night's masterclass, I'm going to post a link in the description. Join us as I went through exactly how to close more rent to rent deals and how to overcome those.

[00:00:27] Objections

[00:00:33] I'm Simon. And a few years ago, I decided I wanted to make a change. I wanted to create a passive reoccurring income to support me and my family to be. And a legacy for the future, a future fast forward two years, and I've managed to generate over 10,000 pounds worth of monthly passive income. I've set up the business, scaled the business, and now I've systemized the business to free up my time.

[00:01:02] So join me to find out how I've done it. How well does it doing it every day and how you can do it to.

[00:01:23] Today's video is a really interesting one. It's a actual recent deal of mine. And in the month of July, 2021, I've just had a little look. We've cashed flowed over 2000 pounds on one single deal. Okay. One day. As all it takes to completely transform your life. Because most people I speak to, you know, they need about 1500, two grand, maybe two and a half grand to probably justify moving away from their jobs.

[00:01:54] So, you know, I'm not like selling a dream or anything like that. I'm not selling anything, but I'm telling you that one deal can make. A good amount of money. So on this video, I'm going to be breaking down the figures so you can see exactly how it works. I'm going to take you through how I sourced and secured this rent to rent deal, how much I've invested in making it happen.

[00:02:17] Okay. How I furnished, ingest the property to get these rates that I'm getting here in the Midlands. I last but not least. I'm going to show you how I mark. You know how I managed to get this occupancy because you're going to see in a minute, mark Pennsy rates are very, very high. So before we get into a little bit of background on to this property, it's a two bed, two bath place.

[00:02:44] It's not in the center of Darby. It's on the outskirts, but it's got some good ammenities local to it. It's got a couple of supermarkets. It's got a big hospital. Amazing transport links to local areas, and it's probably like a 10 minute walk in to town. But great thing about this property is it's a bit of a new build.

[00:03:05] It's a high standard of accommodation. So you're not just getting sort of, you know, your leisure guests because as you know, I'm not too fussed about them. What you'll get in his business, guests, corporate guests you'll get in construction guests, you'll get in guests where maybe a family have had to relocate to Dhabi and they, you know, they need somewhere to tie them over or maybe.

[00:03:31] You know, somebody is just moving from one house to another in Darby, and there's been a break in the chain and they need somewhere for a few weeks. I'm seeing loads of this at the moment. So I'm constantly focusing on getting high quality properties because high quality property. Power. So let's go through the figures.

[00:03:51] So whenever I get a brand new unit and I put it online, I like to use penetration pricing. What that means is you start the price quite low until you get the bookings and the reviews in, and then you increase it incrementally until the book in start to dry up a little bit. That's when you know, to reign in may being you're at the right.

[00:04:15] So if you've got a service accommodation unit and it's getting booked for the rest of the year rapid, you're probably too cheap. Okay. To the same degree, if you're not getting any booking. Then you might want to move your prices just to experiment. And that's something that you need to do. Change your prices every single day.

[00:04:33] I'm always looking, I'm like, hang on a minute. I feel like I'm getting a few too many bookings on this unit. Let me increase the. So, what I did over the month of July is I started off around the hundred pound mark. And I ended up around one 30 to one 40 because the bookends would just come in in, but for the purpose of this video, after fees and VAT, it looks like on net in around 110.

[00:05:00] Per night, on average, as you know, I always add the cleaning fee onto all my rates and put that on the guest, because that way it's easier for me to do my figures. So 110 pound a night, there was 31 nights in July and I bought a minimum stay of two nights. So that was one cheeky day where we didn't. If I would have opened up to one nights, I might have, but there was one cheeky day, which we didn't manage to fill.

[00:05:28] So it was 30 times 110 pounds. So 3000, 300 pounds in income. Okay. That's the money coming in bookings to me, the landlord's rent is only 700 pounds on this unit. As I said, it's only a two bed, so I ducked 700 pounds and I'm left. 2,600 and then all my utility is, you know, gas, electric, water, ammenities, you know, extra little maintenance bits or whatever.

[00:06:03] I calculated them at 500 and change. So for argument's sake, let's just round it up to 600. And that's how I do rive at this figure. Okay. 2000 pounds, net, after all expenses of this product. Now one thing that a lot of people don't really talk about in terms of rent to rent, right? Is that you will have the business expenses as well as just the property specific ones.

[00:06:33] So I've got a team now, you know, I've got business insurance, I've gonna have expenses in, in terms of, you know, Phones in terms of virtual offices, you know, you've got over expenses, but in isolation, this deal made two grand in one month and August and September are looking like they're going to do the same onto point number two.

[00:06:55] How did I do it? You're probably thinking yell, right? Simon. It sounds a bit too good to be true, but how did you source this property? Well, this one actually sourced me. What I do in my business is I do a range of different type of market. And I'm basically saying, look, Mr. Or Mrs. Landlord we'll guarantee your rent will take on all the management and maintenance of the property.

[00:07:17] And I'm putting that out in different ways. And this came through our phone service, we've got a virtual office, somebody caught up and said, hi, I've heard about your services. It sounds great. I'm a portfolio landlord. You know, I'm actually going to. Having a few properties come available. Can you come and have a look?

[00:07:35] So I went out, had a look, made an offer there, and then I knew the area because I had a property around the corner and we agreed there and then pay for it was done the day after I got the keys the day after. Simple as that. Okay. So what I want to stress to anybody doing renter and at home, don't get me wrong.

[00:07:53] You can spend your days actively looking on right move and doing this and doing that. But what you want to do is you want to get your marketing strategies up. You know, whether you're doing letter sends, whether you're going to be doing lamb wretches, whether you're going to be doing flyers, whether you're going to be doing posters, where are you going to be doing boards?

[00:08:10] Whatever it is. Get a few different streams in, and then let the leads come to you. And it's not going to happen overnight, but over months and months of compounding and people seeing your marketing again and again. This gentlemen had seen must have six months ago, took him six months to call me. That's how you can get the lead.

[00:08:30] If you're finding this content useful, make sure you subscribe like this video weekly content two times a week helped me grow this channel, share this video. So my shirt with somebody that wants to get into rent to rent. Okay. So that's how I sourced it. It sourced me through my channels. Point number three, how much did I spend?

[00:08:53] As I said, this property is relatively new, so I didn't have to do much. I didn't have to do much at all. I did some light painting and decorating, which cost around 500 pounds. Okay. I furnished the property fully, which costs two and a half thousand pounds. It's only a two bed. So it cost around 3000 pounds and change.

[00:09:14] So three grand I'm almost breaking even in one month. That's it. No new kitchens, new bathrooms, no crazy stuff. The bathtub, not the bathroom, the garden. Super, super low maintenance. Really, really nice property. Nothing big. Uh, I try and get the properties where I don't have to do much work. So three grand, not bad, a number four, how exactly are by marketed it like, you know, where have I put it to get all these clients?

[00:09:44] How have I got all these bookings? Well, I just want to add something here, which is really interesting typically, right? Typically I would want a rent-free period to do the pay in and decorate in and this and that and the other, but because I knew. What this property could do. And because I wanted to start off on the right foot and it was a good price, I just paid from day one is fine.

[00:10:08] I pay from day one. I did the work super quickly, but as soon as I know a deal was likely to happen, I bang it on your platforms, whether that's booking.com, Airbnb, get my channel manager set up. And what I do is I use pictures from another unit that are similar and I just do a disclaimer at the bottom and say, Hey, these are not the exact.

[00:10:30] Pictures property is going under renovation at the moment, but it is going to be a similar standard. And then if somebody wants to book, they know what it is. Okay. If they've got any questions, I'll say, look, yeah, this is not the property, but it's going to be the same standard. This is the address. However, this is the price.

[00:10:48] However, this is the amount of bedrooms, bathrooms, and everything else. And then I'll upload the images. Some people that will put off, they'll be like, I'm not sure, but a lot of people, especially business and corporate guests, then. There's like as good enough for them as long as it's decent. So as soon as I knew this deal was happening, I banged it on my platforms and got it out there.

[00:11:12] So I was getting bookings coming in before I'd even finished the renovations. And then what I do then as soon as I got the pictures, I dare not load the pictures, take the disclaimer out and happy days. So I put it on my Airbnb or put it on booking.com, channel managers and most important. I reached out to all my existing companies.

[00:11:35] Okay. I'm not reliant on these platforms. In fact, I would rather have my direct bookends from my clients that I know. Um, but I don't have to do due diligence for, because I've worked with them before and get those in. So some of my bookings were existing people. I managed to get into the. Photography, absolutely key don't scrimp and save, make sure the furniture is decent.

[00:11:59] Make sure you've got comfy beds. Make sure you've got your comfy linen and towels and stuff. And you essentially, and then other than that, you know, it's all good. Ready to roll and systemize last but not least management. So you're like, yeah. All right, you're getting two K a month, but how long is this taking you?

[00:12:17] How much time is it taking you with. Since the first day, the first day when this went live, which was probably two months ago to the recording of this video, I'm not been down to the property again. Okay. I've not been down, but I have actually got a serviced accommodation manager. Now I've outsourced that part of it.

[00:12:38] So to clarify, I've got a team member I've not outsourced it to another. I've hired in to run these units. Okay. That's what you can do once you've got a few of these key safe at the property automate check-in we've got guides so that people can find the property. Um, we've also got everything in place so that they know exactly, you know, how to use the bits and bobs into the property.

[00:13:03] And then once the guest leaves our follow-up or should I say, my team member follows up, gets a review, and then we move on. And incrementally every single time I'm increasing the price. At the time in July, we started off at 110 pounds gross. We're now all the way up at 150 pounds and the bookings keep coming in.

[00:13:24] So I hope you've found this useful. Do me a favor comment below. Let me know if you've got any questions. If you want to reach out at Simon Smith for line on the Instagram and remember whatever you do, don't wait 25. Okay, Craig.

[00:13:50] Thanks for listening. For more information, check out Simon Smith, online.com. See you next time.