The Property Unleashed Podcast

Avoiding Rent-2-Rent Mistakes with Mark Fitzgerald

• Mark Fitzgerald • Episode 241

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Want to pivot the typical rent-to-rent strategy mistakes into wins? 

Join  Mark Fitzgerald as he highlights five common mistakes people often make when starting a rent to rent business.

Let's go  behind the scenes, sharing  real-life experiences, the obstacles  faced, and how we overcame them. 

Mark, with his wealth of experience, provides valuable insights into choosing the right strategy, having a clear vision, implementing appropriate systems, exhibiting patience for profits, and seeking help when necessary. 

We packed this episode with personal anecdotes and actionable steps to steer clear of these pitfalls and build a successful property business.

Continuing the momentum, we turn the tables on problem-solving. 

Mark underscores the potential of problems, illustrating how they can be opportunities for income generation. Yes, you heard it right! More problems could equate to more profitable solutions. 

Drawing from his extensive property business journey, Mark urges listeners to embrace an entrepreneurial mindset when confronting challenges. 

We also provide resources from the Property on Lease website to supplement your understanding. 

Don't miss out on this treasure trove of tips and techniques, make sure to share the episode with fellow entrepreneurs. 

We're all about transforming challenges into opportunities here!

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Speaker 1:

Five mistakes I see people making when doing rent to rent. Hello, my name is Mark Fitzgerald and it's great to have you joining me here today, so I'm going to cover five different mistakes that I see people making when trying to get involved in rent to rent, when starting a rent to rent business. Now, rent to rent is a superb strategy. If you've only just heard about it. It is a very cost effective way to build up a property business and to get started in the property world. Why is it so good? Well, you don't have to have massive amounts of money to get started in rent to rent. You can start with a very modest budget. Indeed, you can take on properties that have already got furniture, that are already licensed potentially, if you're doing HMOs that are already set up, and then you just manage those. Now you could say to yourself why doesn't the owner or the landlord do this themselves? Well, a lot of the times, they don't know how to set themselves up for, as I like to say, success. They don't know how to put the systems in place to be able to make the most and maximize their profits on their property businesses. But whilst this is a great strategy, there are a lot of people that just jump straight in at this and mess things up. I see people doing the rent to rent strategy with short term rental service to accommodation, and they do not make money. In fact, they lose money, which is even worse. Or they do it with the HMO strategy houses of multiple occupation Yet they don't set the systems up, they don't set themselves up in the right manner, so they again. They end up losing money. They have voids, they have high maintenance fees. Listen, if you can streamline this and you can systemize this, you will put yourself in the best possible position. Now, if you visit thepropertyonleachcom, I have a 10 step rent to rent guide ebook there that'll help you with the systems. That'll help you systemize this. So nip over after this video and check that out. Download a copy for yourself. Okay, we have some other guides and other tools and trainings there that can help you as well, including a free masterclass. But anyway, the five mistakes that I see people making the most.

Speaker 1:

When getting started here, I used to work in a nine to five job. I used to hate that job and I used the rent to rent strategy to get out of my day job, to replace my wage and to build up a systemized business that doesn't enslave me but that works for me. So the first mistake that I see people making is to not be passionate about what they are doing. I never got into property to become a property managing agent Okay but my business does that. I am in charge of my business and initially I had to run around and do everything myself and I had the passion to grow a business, but I had an end game. I knew what I wanted the business to look like. I knew the systems that I wanted to put in place, I knew the people that I wanted to put in place, and that is what I have focused on and built.

Speaker 1:

Now, it does take time to build. You have to get the deals, you have to get the revenue coming through, you have to make the profits, but as you start to go up that stepping stone of taking more properties on, you can start to bring people in to work into your business as well. Now my passion is property and it is building businesses. Okay, so that is something that makes me want to keep going when times are hard, when things are maybe not going my way all of the time, and this is why we help people with this as well, because I've made a lot of mistakes, I've had a lot of problems, I've had a lot of setbacks, but I'm still here and I've overcome them. So I like to now help people to overcome these setbacks, mistakes themselves, or potentially not even have them. Why? Because they know what not to do. Trial and terror can be a terrifying thing, so why? Why put yourself out there not knowing what to do? But you have to be passionate about what you're doing and I always say you start at the beginning. So look at the HMO strategy, look at the service to accommodation strategy. Both of these are brilliant when using rent to rent, but make sure you pick one that you really want to do.

Speaker 1:

I started with the HMO strategy, as I always say, because it was easier. Once I'd filled the rooms, I knew the rents that I was getting each and every month. Well, it's obviously service to accommodation. Short term rentals, airbnb's can be a bit more seasonal. Yes, you can earn more money, but it's not always the same each and every month. So I went steady away with the HMOs and, of course now, as I always say, do service to accommodation. It works very well in my package, so make sure that you're set out with the right strategy. You're going with what you believe is the right strategy for you. The money will follow. So don't think well. I prefer actually steady away HMOs over service to accommodation, but service to accommodation I can earn more money, so I'm going to do that. If that's not right for you. There are more moving parts there. There's a reason you make more money is because it's a little bit harder or a little bit more work involved. But again, you can systemize this. Again, we can help you and show you how to systemize this and you can build a very sustainable and profitable business. But you've got to know what's right for you and, like I say, I see a lot of people getting involved building businesses, getting involved in property only to make money.

Speaker 1:

Try and not fall into that trap. Try and be one of these people that actually wants to build something, a legacy piece, a business to be proud of, rather than just chasing the pound signs all the time. As I said before, the money will come, but you've got to do a good job first, okay? So the second mistake that I see people take is not taking action. They talk to talk, they walk, walk, yet they never do anything about it. They never do any marketing. They never send any letters, flyers, they never go and speak to agents. They're always talking about how they're going to do it. I'll do this once I've got my website. I'll do this once I've saved some money. I'll go and talk to them once I can, once I know what I'm going to be saying and everything, and that is a mistake.

Speaker 1:

You've got to start taking actions, okay, you've got to have a plan. You've got to set some goals, set a really big goal, yeah. So maybe in one year you want to have 10 properties, 20 properties, 50 properties, 100 properties. Set a really big goal. That'll stretch you and then, as I say, break it down into bite-sized chunks each and every day, but take action on it. Speak to an agent a day, send out your marketing, reach out to landlords, go to networking events. Do things one step at a time, about one foot in front of the other, and just appreciate the fact that you're going to get a lot of nodes. You're going to get a lot of disappointments in the fact that people won't always want to work with you, that your make offers and it won't go through. That is just part of the process and the people that stick with it are the people that get deals. Okay, I've got some clients, some students in our rent-to-rent business builder and our ultimate service accommodation training as well, and they've had loads of setbacks. And the one thing that is actually different for them than a lot of other people is they keep going. They look at the setbacks as a stepping stone to the next.

Speaker 1:

Yes, so at number three for mistakes that I see people making is trying to please the landlords or the agents. Now, what do I mean by this? It's basically they speak to a landlord. A landlord says I want 2,000 pounds a month rent on this property. They go away, they run the numbers. They know for a fact that 2,000 pounds is too much to be paying. Yet they do a deal. Why? Because they're motivated buyers. Okay, they're not motivated sellers. Motivated sellers will be the landlord. They're motivated buyers. Why? Because they just think I just got to get this one deal. This one deal doesn't even have to be that good. It's something I hear all the time. It doesn't even have to be a very good deal. It doesn't really have to make me any money. I just need that first deal.

Speaker 1:

That is a mistake. That is wrong. Do not do that. You will regret it 100%. You will regret it.

Speaker 1:

If a landlord or an agent says to you this is the market, rent you go and you run your numbers. Okay, you run your numbers and you see what is a good deal. And once you've seen what is a good deal and what works, those are the numbers that you go back, whether they are less than what they're all talking about or not. If it stacks up at a certain number point, then you give them that number. If it works at 2,000 pounds and this is just me messing about, throwing numbers about but if it works at what they put out there, happy days. But if it doesn't, do not mess about. Fudge the figures, as I like to say, to try and make a deal happen. Why? Because you'll regret it, you won't make any money and you will struggle to do a good job. So that is another mistake that I see people making. Do not mess about with the numbers, do only good deals.

Speaker 1:

And the fourth mistake that I see people making from my five mistakes that I see is people are not consistent for long enough. They send 100, 200, 300, 500 letters and then they say it doesn't work. They speak to a handful of agents and then they say there's no agents that want to work with me. They speak to a few landlords and they get rejections from their offers and they say there's no deals in my area. That is all part and parcel of this business.

Speaker 1:

Now you think of any business that's out there that's putting a service together, that's offering a service to people. Now, whether it's selling you something, some people will shop at Tescos, some people will shop at Sainsbury, some people will be posh and shop at Waitrose, but they will like the products better and that's why they always shop there. You have a service, you have an offering, you have a product. Not everybody will like your product and it is a numbers game as the people that will work with you, that will want to do business with you, and you've got to think of it like that. It's nothing personal.

Speaker 1:

Remove the emotion from your property business and actually just look at your property business as a way of Making money and doing a good job and serving people. Okay, you are there to serve people and make a profit at the same time, but by doing a good job, so you're gonna look after their property as if it's your own, keep it to a high standard, make sure that it's not Falling into disrepair, and for that the landlords will give you a little bit of a premium for that. So have faith in your product, have faith in your offering, but be consistent in your approach. If you are gonna do marketing, plan out the next six months at least with your marketing this is how long I'm gonna go at it. Why I tell you what if you do that and you are consistent and persistent with it, you will get leads. You will potentially get deals, as long as you know what to say when you actually do get the calls. And, of course, when you're talking to agents again, even if they shoot you down, you again got to be consistent and Persistent in your approach with those agents. You've got to keep telling them who you are, why they should be working with you and taking it from there.

Speaker 1:

Okay and lastly, number five is Stop looking at problems as setbacks and start looking at problems as ways of Learning. A lot of people get the problems, they get the setbacks and then it all falls apart. Why? Because they said no to me, they wouldn't do this, they wouldn't do that. We're all gonna have problems.

Speaker 1:

The thing is you want more problems than anybody else. Why? Because then you've got potential to have more deals, to have more solutions, to have more opportunities. If you have no problems in your life, you're not doing enough. So if you look at problems as Solutions and you find those solutions, most of the time you can generate income From the problems that you find. And if, course, you're having those problems, then that chances are other people are as well. So those are my five mistakes that I see people making when getting involved in the rent-to-rent strategy. Again, like I said before, check out the property on lease for some free training, tools and resources to help you on your merry way. Fill free to like, subscribe, share this episode and come and join me in the next episode. Now you take care and bye for now.