RENT 2 RENT
Rent 2 Rent is a proven high-cash flow, no-money-down strategy.
How does it work though?
Rent 2 Rent allows you to utilise someone else’s property instead of purchasing a property and undergoing expensive refurbishments by simply renting a suitable property and sub-letting the rooms individually. If the property doesn’t already have a HMO licences then you will need to contact the local council and apply for the licence which is usually granted due to the lack of housing for professionals in commuter areas.These are exactly the areas you need to be targeting trendy areas with a high footfall of professionals and easy commuter links into the nearest city. The next step is to make the house suitable for an HMO ensuring you have fire extinguishers, signs and relevant health and safety procedures in place. Some properties will already be converted allowing you to move in your tenants much quicker, saving you time and money.
It sounds straight forward but the skill is knowing what to say and when to say it to the Estate Agent and Landlords. Making the Landlord aware that you will take care of any small maintenance issues and that he won’t have to worry about tenants moving in and out for the next few years which will save him money on void periods when the property is vacant. Also,let the landlord know that the property will be kept to a high standard with a weekly cleaner checking the property, no children or pets living there but just professionals who are usually out of the house most of the week.
Here’s how it works, instead of a traditional rental, letting the house to one individual couple or family, you rent out the rooms individually. So for example, a 3-bedroom house is rented for £800 pcm when let to a single family. But when let as a multi let of £400 per room, plus converting the lounge into another room the potential rent could be £1,600, doubling the rental income.
A lot of people think that it might be difficult to find tenants for the property, but this is not a problem as long as you have a property in an area where people can commute to a busy city or town then just place your advert on certain HMO room sites and wait for the calls to come in
Once you start to build up your portfolio like many others already have you can soon be financially free. Normally when people start to hit double figures with their rent 2 rent then they usually employee a property manager, aka a handyman who can help with the day to day running freeing up your time and allowing you to sit back and relax knowing you are making a residual income out of properties you don’t even own!