I was always interested in property and investing from a young age, well certainly young by today’s standards. Having watched my parents buy, move into and then extend a relatively modern house in the 1970s, there was always the visible role model. My parents taught me – either directly or indirectly – the value of sound investments, how to manage a budget and my personal finances, a strong work ethic and most importantly how not to live beyond your means. There was therefore a solid foundation for aspiration for home ownership and saving for a deposit seemed the normal thing you did. The practical aspects of property ownership were also taught in the form of maintaining and extending the home which I helped with when appropriate.
After completing a degree in Chemistry in 1991, I decided to stay on at University (UEA Norwich) and complete a Ph.D. It was at this point aged 21 that I began looking for a more permanent base and it seemed natural to want to buy – rather than rent – a house. Even though the bank of England base rate was just under 11% (having been nearly 15% and couple of years previously) this did not seem to feature in the decision-making process. Property prices had fallen dramatically in recent times and with the help of a small loan for part of the deposit I was able to purchase a terrace house for 40,000 (which had previously been advertised at nearly 60,000) – these same properties are now regularly selling above 200,000.
To pay for the mortgage I decided to rent out two rooms to fellow students and the property therefore ended up costing me no more to own and run than it would for me to rent a room somewhere despite the high mortgage interest charges (The Bank of England base rate briefly touched 15% again in 1992). After leaving university in 1994 I kept the property and rented it out as a proper ‘student HMO’, getting it managed by a friend of the family who lived locally. Eventually I had to sell the property in 1998 when I set down roots again in Kent.
From the late 1990s I established a career in the pharmaceutical industry; however the investing bug was never far away and I bought two properties which I still own as buy-to-let investments. The strategy was not a formal one – I would simply buy and do up a property, live there for a while then more to another property, all whilst focusing on my industrial career and saving or investing spare cash to build up future deposits. In 2004 I then bought my first ‘hands off’ BTL investment (which I still own) and it was then that the idea of property investing as a potential formal side-line at some point in the future was born.
In 2005 I met my now wife Andrea and we combined our small investment portfolios (total 4 BTL properties) and refinanced them to buy a house to live in together. The portfolio was still lowly geared due to house prices
growth and providing a decent income (about 30% of our combined income).
The fundamental change from small part time investor to full time property business owner began in 2011. With redundancy looming from my job and Andrea now a full-time homemaker (previously an Engineer) and looking after our two small children, we had to make a decision on our future direction. A decent career move for me in the UK was going to be difficult and being reluctant to move back to the US or elsewhere overseas we decided to go full time into property investing.
In July 2012 I was made redundant. Fortunately I had built up a decent investment portfolio of stocks and shares – perhaps envisioning such a move in the future – and this coupled with a redundancy package was enough to see us through the transition. We added two decent sized BTL properties to the portfolio in 2011 and 2012 and two more in 2013 taking the total to 8. These properties were refurbished and revalued and initially they we kept the gearing low to maximise the net income. Although things were tough initially and we had to cut back considerably on our expenditures we officially became ‘financially free’ in 2013.
I am now an established full-time property investor and property business owner – The Property Lifeboat – with multiple complementary property related businesses – Lifeboat Lettings – and have completed on many property transactions. I’m a fundamental believer in the philosophy that it is possible to break free from a 9-5 job and become financially free through property but it takes hard work and commitment to a plan, as well as a bit of risk taking sometimes.
