How Can One Deal Set You Up for Life?
Ever wonder how some people seem to hit it big off just one deal? Here’s the truth: it’s not magic, it’s preparation.
Start by investing your time today in building relationships. Think agents, architects, planning consultants, builders—and, most importantly, people with money who can back you. Networking is key. While you’re at it, analyse every deal on the market. Break them down, figure out what the site is worth, and make offers. Pay attention to what’s selling, reverse-engineer the deals, and ask yourself: What are others planning to build, what margins are they working off, how bullish are they?
Doing this gives you a feel for the market, a sixth sense. That’s invaluable.
When Opportunity Knocks (Like in 2008)
You’re not just collecting data—you’re prepping for the inevitable downturn. Like the crashes in 1989 and 2008, there will be another market dip, maybe tomorrow, maybe in 10 years. If you’re not ready to pounce when it comes, you’ll miss out on those once-in-a-lifetime opportunities.
Most people say, “I could get into property if only I had the money.” But the truth? If you find a great deal, the money will come. The bigger problem is that most people don’t have the knowledge. Money’s just part of the equation. Knowing how to analyse a deal, secure planning, find builders, spot the angles to the deal and navigate the landscape—that’s the stuff that separates you from the pack.
It’s Not Just Buy, Build, Sell (If Only It Were That Easy)
If you don’t have the capital for a deal, don’t stress. Partner with someone who does. Trying to save for a deposit while the market moves faster than your savings? That’s the hard way.
When 2008 hit, we were in a great position. Many investors and developers were overexposed, while we were on the lookout for deals. Sure, with hindsight, every deal back then looks golden. But at the time? The market was shaky, and no one had a crystal ball. The climb back up is always full of uncertainty.
Our One Deal That Changed Everything
Fast forward to 2011. The housing market was still limping, banks weren’t lending, and everyone was still feeling the aftershocks of the crash. We found a gem: a C2 block in North London (C2 being where elderly residents live independently in the own flat). Back then, banks weren’t lending, and developers were dealing with their own problems in the aftermath of 2008.
We scooped up the block, undertook a light refurbishment, all of which amounted to £100/sq ft, which, get this, was basically just the build cost. That means the land was effectively thrown in for free. We got the change of use to C3 (residential) and rented out the units, which gave us a solid 14% return—a figure that’s nearly unheard of in London for single lets. Then, we added units on the roof over the following years which added huge value to the deal.
All in, we invested £4.6m (both debt and equity). Today, the block is valued at £12.5m. Profit £7.9m. Plus, a very healthy annual income along the way.
One Deal. Set for Life.
You don’t need to be running around doing 10 deals a year like a headless chicken. Be selective, be strategic. Master your craft, become an expert in your field. When you have that one golden deal in your hands, take it to a cash-rich investor. Trust me, if it’s good, they’ll back you.
But remember, it’s not luck. It’s the hours of preparation, learning, and networking that set you up for when opportunity knocks.
So, good luck hunting down your once-in-a-lifetime deal. When the stars align, you’ll be ready.