#2- The Title Split Consultant, James Lynch "20k/month Rent Roll From 1 Deal"

From the ground up is all about us learning with you, with all these experts that we are bringing you on. From simple strategies to the most advanced, property strategies, these people are all successful in what they do and have so much information to share to you and we cannot wait for you to listen. James, could you tell your men, you've been busy man since we last saw you, we'll just talk in just then, you've, you've, you've, you've, you've been building quite the empire on the rentals, you know, a few years. But everyone that hasn't met you and has, has an upper pleasure. Give us a little bit of a, a bit of a background on yourself because it's something recently that you're going to quit your job into property, but you've, you've scaling massively. Yeah, yeah, sure. So a brief, a brief history then that could be, had my first bite of letting 2012, didn't really do a lot for the first few years, started to buy one by one bit more seriously in 2018, in parallel with, yeah, corporate job and project management. And then bought a very small block of flats in 2021. I think it was, yeah, during COVID was really pleasantly surprised how well the numbers worked on blocks of flats. And that sort of, yeah, sent me off down a bit of a rabbit hole to see how we could accelerate the portfolio, which at that point was, yeah, and for the units by buying big, big, big blocks. So found the, the sort of fairly neat strategy of title splitting. So buying a big block flats, trying to borrow off the aggregate flat value rather than the purchase price. And basically needing to put a little or no money in. And obviously that will just allow you to accelerate your portfolio building. I'd look in around, probably was what, yeah, 2021 into 2022. Found a great block flat down in Turkey. I think it was 11 one bed flats. Was going very well, the figure stack. Bend a pull down and we lost it, unfortunately. So kept looking, kept looking. And I'm very nervous was the first, the first one at this point of this sort of new strategy. We ended up finding a block of 40 down in Pembrokeshire on the market for 1.4 million. And to stay there, we're going to get in a calculator out that's 35 KF flat, which yeah, Pembrokeshire is cheaper than the Southwest, but it's not that much cheaper. Crazy. Yeah, I mean, it was, it was one of those ones where you didn't need to run it through your spreadsheet. You just, you just knew it was right. And so yeah, I pushed pushed hard to get to the front of the queue, basically, because there was a lot of interest on that when it, when we were on the source that in September 2022, just before I quit work in October, 22. Wow. So you're at what was it? I think 64 you. Sorry. So you're at 64 units now, right? So you got 60. Yeah. Yeah. I think it's 64. We have, um, so we have that block, 40, which came to us as one, yeah, one big apartment block. And then once, I mean, you guys will know very well with your, your own business. If you start to grow in a certain area, it becomes easier to continue to grow in that area, right? So, um, we bought another block of five two bed flats, about 20 minutes away from that one. And then another block of five flats with a commercial unit. So what's that 51? And then we've got something like four in Abergavelli, three flats and a commercial unit. 55. And I think we've got nine properties in Bristol. So yeah, 64, including two commercial units. Um, I love you. I love when you're, I love when you're like trying to count how many units you got. And that's only in two years as well. The two or three years, you know, we'll just start building up all five. How many do I go? That's class. Yeah. I always think you've done well when you lose count. Actually, you're right. Yeah. You're staying. So I think you're. The garden. Sorry. James gone. I was a, yeah, it keeps, uh, it does keep, um, I do keep forgetting where we, where we are. But yeah, 64, including the two commercials. And, um, it's a bit of a mixed portfolio as well. So we've got three HMOs in Bristol. Um, and then a few, uh, single, let's in Bristol, mix of houses and, uh, and leas old flats, where we just have an individual, you saw flats, um, and then everything that we own in Wales, we own the whole lot, we own the blocks, we own free homes. And we're, yeah, trying to develop those further at the moment as well. So they're on the roof, trying to, yeah, see what else we can achieve. Uh, fine. We even more cash flow out of them. I think, um, a lot of people are going to want to, and more about how that block of 40 deal happens. So we definitely have to get into that because that's pretty impressive. That's the kind of, yeah, sure. Yeah, I mean, that's a great, a great case study. Yeah. So, um, so yeah, found it, uh, source that, um, back in, yes, 10, 20, 22, uh, phoned the source in agent straight away as soon as I saw it. And it had only come on that day, um, and introduce myself to him as the guy that was going to be buying that block. I was so confident that it was, uh, the right one for us. Um, and I was fortunate in it. We'd already done a lot of the, we sort of had a dry run with the tour key blocks. So I'd already spoken to solicitors. I'd already spoke right brokers. Uh, so I knew who I needed to reach out to and obviously they knew me so they could react quickly. It wasn't, it wasn't cold pool. Um, so got onto this list. The investors got onto the broker, Alistair from finance, um, who was sort of, pioneering the idea of 100% finance on, um, on properties like tilesplits. Um, and yeah, quickly sort of confirmed that we could, we could achieve what we were setting act to do, the 100% finance. Um, so I went away and did my own valuation exercise to see what, what should they, what should they cost. Um, and I did that sort of a number of ways to give myself confidence that I wasn't just, um, you know, diluting myself. So I, I ran it through property data, uh, the individual flats. I went through land registry data myself, just downloaded the, the CSV file from land registry and just looked up average square footages. And, uh, you know, so let's, uh, see how that would compare. Um, and I use sort of Nimbus area averages as well. Nimbus maps area averages, um, put all this together. And basically this, this 1.4 million block, whichever way you looked at it was going to be worth between. Realistically two and 2.4 million. So we set, yeah, I mean, amazing, right? What a, what a crazy uplift. Um, so we set a, a sort of a bottom end of, uh, of 1.9 million because we wanted to have all of our money out. Frankly, because we didn't have that sort of money to be playing with. Um, and obviously progressed with the, uh, the bridge loan, um, the 100% bridge loan. Um, and they sent out their value as all we booked in, we booked in their values. Um, I think it was something like, it was probably just after it was, it was just after we booked in the value. Um, that Poise and Liz Truss, uh, came out with their mini budget, which, uh, as I'm sure you remember, just put the whole property market into a massive amount of fear. For, I mean, what a couple of months realistically while we all sort of, what, yeah, mortgage products got pulled right people will lose in finance on development on bridge in deals were going under people were failing to exit rates when you could get them were just going up and out. Um, and, and nobody knew what was happening. So that's the environment that that, uh, that value I went in on was halfway through that month of October. Um, so when he did write his report, he wrote it up at 1.875 million. Um, and I was gutted, frankly, I was a poor going through on a Friday afternoon and I was like absolutely gutted. And then I think, um, I think sort of talking to Laura, my partner, um, you know, she was like sort of brought me down to earth a bit and said, you do realize that you're really upset that we've just made, you know, just shy of half a million on paper and you're upset that it's only. just shot a par from it. Okay, the champagne did come out of the fridge, we did have a bit of a celebration, looked at the figures again and it just meant we had to put 88,000 into the deal now. When you consider obviously again as you guys know 25% positive typical for buy-to-let, you know, that was we were putting down what a 4% positive I think, so it was a good outcome. Yeah, what's the red roll on that now? So I think at this exact point in time we are 38 units full of the 40, we've got one, guys just moved out, but it'll feel quickly and one is undergoing a bit of refurb, so that'll be a few months for, well, it's a month or two before it's held. I think we're at 18 and a half or 19,000 a month, those two empty, so we should be 20 to 21,000 a month when we're full. That's amazing, because that's one deal. Yeah, one deal that changed your whole life. One deal, yeah. What do you think? What do you think? What are you over the line? Because like you said, there's so many people going for it, was it the fact that you had all those local contacts and you could act the fastest on it? What was the kind of situation that? It was. So I really was very, I chased that source of like nothing else. Yeah, like I was basically, I'm going to be your best friend for the next month, sort of thing, ringing in most days. Every time you asked for information, you know, you asked for passports, and he had it within 20 minutes, you know, he asked for proof of funds, not we were intending to put money in, but we showed him some proof of funds, and he had it within 20 minutes, and he very quickly realized that working with us was going to be much easier than some guy he was going to be chasing for weeks for that document. And you know, he was. There was a fair bit of paperwork. They asked for like letter of intent, which you know, I think there's a lot of people out that's probably never heard of a letter of intent, so you know, we put that together, like, you know, it's a term sort of document, quite quickly, and got that back to him, and I think they ended up, I think there was 50 people that contacted them via the source app that day, and we got shortlisted down to like about three or four, and then I did ask him later, guy called Josh, and he said, yeah, you were just consistently getting everything to us, and you just completely genuine that you were going to complete on it. You were very confident that you were going to do it. He said, and that just made much easier, so he was. He was. If you think about anyone in sales or even sourcing, like, they don't, like, you get so many people that just pick and down the road, and then they have this serious person, they're like, I am, just like, everyone else, I am just going to put all my attention to this guy, because he's obviously on it. And I think that's so true. So many people think that the best off a win, but we've recently realized that we were the best off, and with some deal that we've just done, we're probably the worst deal, like the worst off, but we got it, because it was relationships, and the person like, they don't want to deal, but it's awesome. That's such an incredible story, I think, the. Simple strap, isn't it? Like, just. Yeah, by a lot. Like, Blast, and. Yeah. Absolutely. Yeah. Following up, it's just key, definitely. It kind of shows you, like, you kind of assume that everyone would be doing that in that because it's kind of cool. I, like, wouldn't everyone be following up those, because they all want it that much, but it just shows you, like, just doing that makes you exceptional in the group of people, isn't it? It does. You're right. And it is something that, you know, if you are, if that is your mindset anyway, if you are just, you know, you are organized, you follow up, you treat it like the business that it should be, rather than, you know, a sort of sideline thing, then, yeah, you're right, you do become exceptional, and you sort of assume that everyone's doing that, but, yeah, they're not, you know, not all landlords are reference check, you know, not all people follow up on deals. It's stuff that we assume is just a norm, but, yeah, not everyone's. - Second A-SHA, yeah. - No, no, not everyone's up. I type of norm. So, yeah, that deal, that deal still, then it took it, it took longer than we expected it. I think we finally completed in the February for various reasons. We were doing the title split in parallel, so there was quite a lot to do, but in fairness, it was more bridge companies around that time were starting to become more demanding in the documentation they wanted. I mean, partially because of the environment that we were in right then, financially, you know, the after-mini budget. But also, I think that's continued. Yeah, bridge finance now is sort of like mortgage, you know, they really want to see everything that it's not the whip, you know, purchase process that it used to be. But we got it, yeah, so we got it completed in February, and then start is a look pretty much straight away. How do we, how do we ex-like land registry? How do we get off the bridge effectively? And then from that, you know, what is our mortgage product looking like? So, good thing about that was, well, partially that mortgage rates are half of bridge rate, right? But it was also that it gave us another opportunity to get a valuation in a slightly different financial environment where hopefully value was going to be a bit more lenient, lenient generous. So we ended up then September 2023. Yes, September 2023 going back in for valuation again. And this time we got the 2.25 million valuation that I predicted in the first place. So it was, yeah, it made more money and a bit left over, yeah, it was good. And I'm nice to pass the red roll. Yeah, yeah, exactly. And it turned out my valuation skills aren't that bad after all, you know, provided it's not a lot of mouth down in the background. That's just incredible, deal. Sorry, that one. It's a bit of delay here. Interrupting. I'll just say now, it's just baffled me. But you've ever unleashing this right now. It's just like, where do I find those deals? But not like most of the thing, most people won't go find that deal. So they'll just be left to James. I mean, if I'm honest, I've been trying to find a deal like that again, you know, I buy one of those, well, a couple of times a year if I could, but you know, we've had, didn't we wrong, we've had great deals into them, but nothing up there like that one. It's, I'm confident that we will find one eventually, but yeah, two years later, basically still looking for something to beat that one or match that one. I guess as the consistency goes back again of looking as well, right? Like in all avenues at all times. So you don't have to. Yeah, it's the interesting thing is that that block, we're not sort of over since we found it. I mean, over the last two years, yeah, when I've honed my way of searching and gone back through historical data, old auctions, I use the IG sometimes to like to go through auction data back. Yeah. And then sort of bought into the IG premium product where you can look at historical auction costs and prices as well. And I found our block, which had gone to auction in, I think it was, just 2019 maybe. And under a million, 995,000 guide price. And I don't think it had a single bid, which is crazy, right? And I also know from speaking to the sources that before it went on the source app where, like I say, I think maybe 50 people saw it and were interested in it. It had been bouncing around a few sources for a few months and nobody had bit. So it's like it, they are out there. And in some cases there, yeah, they're being ignored. You know, there's not there's not necessarily people chasing them. So you've just got to smash the figures on everything, I think. So how do you look for those? How do you deal with them? So like this is something that even, I obviously, we've talked about multiple times, like you look in America and this is what they do. So consistently over there is like, that's the strategy. Big box, buy them up, get the red roll, do a little bit to it. You good to go. Yeah. But I think it's quite limiting belief to a lot of people in the UK that you can't do that. So like how do you, how did you get into that or more probably like what are you looking to know that feels good or another deal for that man? So the supposed to be the most basic part of it is. Yeah Effectively you've got to find a block which is Block priced rather than individual flat priced so at difference in price is Some estate agents will just price in the individual flats and that's what they'll give as a value to block flat and Others others don't and you find the variation It's it's different in different areas of the country so cities urban areas You tend to be able to find that difference more And coastal areas as well if it's a you know a seaside spot then that can work well and If you found a block say in Merthotid will no offense to the place, but yeah, it probably wouldn't work In person rural areas it probably wouldn't work, but you know, so if you if you can find I think over time you sort of get you can almost just get a feel for it, but you know say Cardiff an area where you know where you guys know exactly what you're doing probably street by street You can look at you know opportunities and know what's good and what's not so you know you might see You might see an area of card if I know that Minimum price for a one-bed flat in that street is 200,000 say and So if you suddenly you know if you spot a block and it's It's priced at 1.5 million and it's a block of ten flats, you know So it's worth two million as in as individual flats you can sort of spot that without even needing to go to calculator and so It's that's your sort of your start is just seeing the difference between two and then Because we're typically buying these on bridge finance there's You do have to calculate the cost of holding it as well. So you you realistically got Gen really got six month hold period and It's just because of day one mortgage rules where you know they say in first six months if you Remark as you can't get any uplifting valuation typically there are some work around but So you have to sort of allow a six month period of being on bridge so that adds to the cost of the purchase Some of these blocks you may need to be doing some works on as well. So that's got to be factored in Typically we try and buy blocks where No works are essential so Utilities have been split, you know they've already got 10 out of first two supplies or 10 gas supplies or whatever and then You know, yeah, maybe you want to Put in you click to any or everything needs a fresh color paint or whatever, but We're looking for one where yeah, we're not having to max really utilities when I'm into moving walls Because then there's no you know, there's no planning to do there's no building wigs to do it just becomes a solicitor's paperwork exercise to chop it up so Finding those is one of the bigger hurdles because Effectively you're sort of you're looking for property that's been to some extent undervalued right so you have to look everywhere I mean you can find these on on right move and Zookler and Actually slightly easier using on the market because on the market Website not mobile app, but website has a blocks of apartment filter which is yeah auctions can be a good place Just networking you know that could be a good because Blocks flat typically owned by landlords, you know, there's not many owner occupiers in blocks of flats So Tightly ratly off-market director vendor stuff, you know all that works well And And then effectively yeah, you've just got to work out the individual flat price so As I said property data is a good one for that just manually doing it via download in the CSV file from Land registry Cheating and using Nimbus or search land or you know any of these methods are are all good And then yeah if you find that the Price if your aggregate flat value is That much more than the purchase price so typically we're looking at a purchase price that's like 70 75% of What you think the split value is or individual aggregate flat points then that's a very good indicator that it's gonna work Interesting I'm writing this down because this is so good. I'm learning watch because I just see sure thoughts Like we're gonna go into the title spitting stuff right because just like that's kind of where you're making The the juicy bit of money right when you kind of Revaluing and stuff like that is that the one reason why you got into looking for blocks Or there other was it like also a cash flow they So the first one that we bought I mean we sort of bought it by Well, I bought it without knowing about title split and so it was a block two three bed flats Previous owner was using it student accommodation haven't been renovated for like Since he so he built it he built it in 2006 I bought it off him in 2021 I think it was and it still had the kitchens in it from 2006 He was charging I can't remember something like a thousand pound of flat for a three bed flat in BS2 Bristol like ridiculously low rate Well, we did you know a really nice refurb on it and It did look beautiful the areas, you know, it's a really cool area if people live close to center of town and It sort of work like a hMO in terms of cash flow, but without the hassles of a hMO, right? You know that's arguments of the guy in room six stolen my mail. Can you fix it? He's a landlord, you know, it's but it's two threes it Two groups of three friends that are just renting a flat together. Yeah So that worked really well and it's like right how do we buy more blocks of flats at that point? We were buying putting our 25% positive soon, which obviously we all ran out of 25% positive sooner or later So then yeah, I just went on a bit of a research and reading sort of Rabbit all of you know, how do you actually finance box blocks of flats and it was that that led me to process a title splitting and then also sort of Finding Alistair who are mentioned before finance who was at the time sort of Making a product around bridging for title splitting, which I don't think anyone had done before And that sort of gave us the The means of yeah going from deposit based investing to Hate to no money down, but you know, yeah, not putting money in investing Not not having 25% it's not I mean 25% I mean money went in like I say but yeah, obviously 25% of 1.4 million is not a sum of money that many of us are lying around And this does give you an option to buy that sort of investment with The sort of money that people put into yeah, just a little Too bad flat purchase almost you know around crazy Absolutely It's it's a really cool thing. It's what's something like even I had talked about what I'd to do for ages It's it's it's very cool here and you just talk about it talks bad for but Yeah, so I would go really well with your business well because That would be the sort of the the layer on top, you know, you've you've bought a flat or block flat undervalued Maybe you put no money in Ideally you put no money in and then at the end of it rather than getting market rents You're getting service accommodation money off it as well, which is Yeah, yeah, yeah, yeah, I think when we look at like how we want to Start building a portfolio like I'm really starting to understand those different choices that people make like whether you're Choosing to build a portfolio for just long-term gains or build a portfolio around cash flow And I think when you want to do obviously it goes up and value anyway, but when you're looking at the cash flow element then suddenly Like blocks are great on them because like you said you kind of do one purchase But game always cash flow kind of avenues from it. Yeah, which makes sense. So Let's go into the title system so kind of like jumping around it like for it's the core of everything We're talking about as like what's made it work, isn't it? So For anyone that doesn't know I mean also for us, but for anyone that really doesn't know about it Let's just go right back to like the basics of what it is Give us a beginner explanation and then we can go into it somehow. Yeah, okay, so Effectively title splitting is taking a block of flats, or doesn't have to be block of flats, could be, could be, how's the splitting into, but certainly the way that I do it is a block of flats, which is on one free-hole title, let's say it's ten flats, sake of argument, and because it's on one free-hole title, it's appeal is quite restricted, yeah? Not that many people want to go and buy a block of ten flats or can afford it or would even think of doing it in the first place, whereby one part of that, block of ten flats, that, say, one-bed flat, that's, has massive appeal to lots of people there, because it's, it's a lot, for a lot of us, it's our first home, a one-bed flat, and then a bit later on down the line, it might be our first investment as well, so huge demand for one-bed flats, small demand for blocks of ten flats, so the process of chopping that up is referred to as title splitting, but more accurately it's free-ating long leasels, so again most people will have heard of leasels of flats rather than sort of typically free-hole houses, and in fact what you're doing is you're creating that lease, so you're saying for 125 years or 9 under 99 years, we're now doing 9, 9, 9 years, you have a lease for that flat, and that's the way of chopping a block of flat into individual bits, it will come, and the lease old, I probably should point out that we're having this discussion on the 4th of September 2024, because there are some quite big changes coming, which I will address as well, but for now, yeah, and the past and the present is free-ating leasel flats, so those leasels can then be sold to anyone, you can sell them to an owner occupier, it could be someone's first property after the guilt, move away from renting, or it could be people downsizing in later life, a lot of people want one-one-bothered-lats, two-bothered-lats, whatever it might be, so you effectively engage a slister, and they typically are not your standard conveyance-seem slisters that you might just use for a standard personal residential property purchase, it tend to be commercial solicitors with a focus in property, we tend to use commercial slisters now for just about everything we do in property, because we just find there easier to work with more holistic approach to buy and property, so you engage with this listar and they create the leases for these flats, you have to supply them with some of the information, most notably you need a title plan for each flat, which lot of people will have seen leases which on one of the many pages will have a little outline of the floor plan of the flat, but drawn to a proper scale, not just a state agents plan, with a red line around the edge usually, so you have to get that, which if you're lucky it might already exist, maybe someone's done some planning recently, and there's an architect down the street that's got them on final still, or otherwise you've got to send someone in to measure up, with a certain level of accuracy, the rest of the leases basically dealt with by the slister, they may ask for your input to some extent, you know, the 1, 9, 9, year leases, 200 year leases, and so on and so forth, but they split those properties, now remembering that you said keep it simple, so that's how you create your leases, and that creates the individual flats, so the reason you do it is because they're just worth so much more money as an individual than as a block. I think that probably, yeah, it's good, yeah, you're literally you're creating a more sellable thing, yeah, I mean sometimes it's, I suppose one way of thinking of it, you know, sometimes you go into that corner shop and you know, the unbranded corner shop at the end of the little sort of residential street, and you go and get a can of coke, and it says, "Multipack, not for individual sale on it," and you're like, "Oh, well I'm buying that as an individual can of coke, what's going on here?" And effectively the shop owner has gone down to the cost, you know, the caption carry or Costco or whatever, maybe they've even bought them in little, I don't know, and they worked out that, yeah, if they buy the multi pack, they're so much cheaper because it's a pack of 10 or whatever, that they can then go and charge, I don't know, a quid-quid 50, what else, the can of coke cost these days, I don't even know, and they'll make money on it, right? And it's basically the same process, it's that supply and demand of, yeah, chopping things, chopping things up and selling it off, sort of, almost like ass-it-shipping a business. Yeah, I was thinking, I was thinking of a cabri, like it's a big cabri block, and then you can get the little cabri bars, and if you were to buy it, the same amount of blocks for each of that, like I reckon it'd be like 10 times the price, and we're talking like, "There you can obviously like, up a quid here, but just in my understanding, I think I know the answer, but I want to confirm it, if you think about, when you buy the block, you're basically the freehold, and if you're then just renting it out of people, there's no leasehold is in there, they're basically just renting off you directly, and then you're probably just charging them a service fee, right? So it's a good question, good question, and a bit of the other way, I didn't cover, so yeah, that's probably the next bit to explain perhaps, yeah, so yeah, so what you end up with is, as you said, the leaseholds, that you've worked with your solicitor to create, and then they get registered with land registry, very slow process, you can come back to as well. And you also have the freehold, and I sort of think of the freehold as being like almost the empty wrapper that's left, so it's like the outside fabric of the building, it's the roof, it's the external walls, and the lethal flaps are the individual bits of flats in the middle, and one can't survive without the other, yeah, if the outside of the property went, then you'd have a floating flat in the air, which wouldn't work, and in the same way you can't have one without the other in terms of leasehold and freehold arrangements. You also can't own leasehold and freehold in the same legal entity, so what we do, our preference is to have what's called a top-co and bottom-co arrangement, so basically it's like a group holding company at the top, and then underneath that we have a subsidiary company or bottom-co, the freehold goes in the top, and is approaching worthless, it's got a little bit of alley, but approaching worthless, and then the leasehold sits in the bottom, sit in the bottom-co, and that's where the value is. Now with regards to your question about the leaseholders, so we are effectively the freeholders in our top-co, and then the leaseholders in our bottom-co, and the tenants, the tenants are simply tenants who just happen to be renting a single flat from a leasehold-owning company rather than from a freehold-owning company. The service charge, Visali, is charged from our top-co to our bottom-co, so we charge ourselves a service charge, but it's only there so that it's got to be the freehold company that, for example, takes out the insurance on the block, so the leasehold company therefore has to be the one that puts its money in for the freehold company to go and say, "Yeah, we'll insure this," and if the roof starts leaking, it's the freehold company that will go and fix the roof, but it has the right to charge the leasehold company. Then what would happen in the case of, let's say, I mean, with our big block down in Pembrokeshire, you know, it's a long-term hold for us. It's the cornerstone of our portfolio effectively, but say we wanted to sell some off in 20 years time, we could choose to sell one of those leaseholds, ten of those leaseholds, the whole lot we wanted to anyone, maybe to another investor, but likewise, it could just be to an owner occupier, and regardless of who bought it, the person that they're known to say they own flat six, the new owner of flat six will have to put in, you know, one 40th, effectively, of the overall insurance cost, service charge cost, so on and so forth. >> Like shared freehold and that kind of situation. >> Yeah, so we've not done it as a share of freehold. We've just done it as a traditional leaseholder freeholder setter. >> Yeah. >> Planning on selling any of them? >> Yeah. >> Well, I mean, we're not planning on selling them. Like the share of freehold thing is you're right better if you're planning a sort of a development exit where you sell them off one by one because it means at the end of it, the leaseholders are the ones who are going to have that managed one company ownership or buyer or a directorship, but effectively ownership. And that's better for them and it's also better for the developer because they can develop a fully exit, but it's also good for the leaseholder because, yeah, they feel more confident that they have a share of effectively the really gone as you know, root for both their head as well as the fact. >> Yeah, there's kind of a perception around like the value of that, I think, especially for like single purchases, like you said that that makes until better, like there's some extra worth to it. Yes, I guess the control element is what is valuable, right? It's not actually worth that much now, is it really? >> Not anymore, no. So there was a, you know, for a long time there was a sort of property play called, you know, basically having freehold rents. So that, that, that, that ground rent that, you know, you often see in right move adverts, you know, it'll say there's a 250 pound typically ground rent and you just look at it if you find a lease off flat and say, well, that's annoying, but it's only 250 with a year who cares. Obviously, if you've got a block of 10 flats and that's 2.5 and a year, then all of a sudden it's almost money worth, well, it is money worth having, right? So people would sometimes buy the freehold to get that 250 pound times 10, 2.5 and a year. I think there was various different ways of valuing what the freehold would be. Think for a long time it might have been like 10 times, so like 25,000 by 2500 just worth, roughly, now I think it varied again by parts of the UK, nor so versus South divide, for example. But now with the, you know, the freehold leasehold reform, with that coming in, people are already starting to offload their freehold rents, investments because there's a potential that they're not going to be worth as much in the future. That might be a good segue into. Yeah, so it's a good segue. So think it's hard to know, because I don't think the date has actually been, right? And now, so it is definitely coming in. I think it's going to be like no earlier than, you know, the end of this year. And obviously, people will be thinking, well, how is that going to impact title splitting, right? Is that the end of title splitting? Is it going to take, I don't know, the profit out of title splitting and stop you doing title splitting? And I've had various sort of questions come my way along, along and so effectively, the short answer is, as somebody that's looking to use title splitting as a strategy, there's nothing to worry about. What it's going to do, commonhold, which is going to be the replacement, is it's, commonhold is almost the same as share of freehold that we briefly discussed earlier, where, you know, rather than having that freeholder and, and the seller, you eat the seller in the share of freehold set up as yet part of that freehold, as it says, share of freehold. So, you know, a management company is formed and the directors of the management company are the owners of the flats, who could be in our ten block flats. For example, again, could be ten owner occupiers, they could be ten different investors, it could be one landlord that owns landlord investor that owns five and, you know, some individual ones. And commonhold is going to do something very similar. It's effectively going to be like share of freehold. The confusing thing is, is that they've decided, so what we currently call leaseholders under commonhold, leaseholders are going to be called freeholders. So, in the bottom we're going to have freehold flats, which have never been a thing, right? I mean, so confusing, isn't it? So confusing. So, it's actually, call it, call it the opposite of what it used to be now, basically. And then they're calling what we call freeholders now, commonholders. I mean, that makes sense. But like, changing freeholders, leaseholders to freeholders is crazy. But other than confusing us all, it's really any other thing that it's really going to do, is it's going to, you know, there's going to be a lot tighter restrictions on people trying to make money off service charges, which has been a bit of a thing in the past and ground rents going, obviously. So, what does that mean to a title split? Well, we've, you know, we started focusing on 999 year leases anyway. So as far as that sort of reversion at the end of the lease sold, when you need to extend it, it's like, I mean, I don't care, right? I'm not going to be around in 999 years. So, so lots of that isn't going to make you blind a bit of difference to me. Ground rent. So, when you're a title split, you're the top and the bottom, yeah, the freehold and the leaseholder, so charge yourself if you want. But I mean, it's not in it. You're not in it for that. Exactly. So it's a tiny little bit of profit that you would have had say if you went and sold off half the flats and kept half the flats that you're not going to have. But it was never, it was never what title split was about. It was just tangibly a little bit of extra money for somebody. So it's not other than confusing us all, it's not really going to have any negative impact on titles, but in terms of it, we'll continue. It's like it's going to more effects agents or management companies that make money from the service. Exactly that. Yeah. And there's been that thing going to dream quality. Which I mean, the unit sort of management. When I'm by that, like, yeah, the management company, so for example, we're in the hazing carter from is phenomenal. They'll keep that like new tomorrow. The garden is a mac, the Zerrubbush, it's like birds everywhere, it's beautiful. But for example, if they're all studying hats, I think it's five grand a year as well, so it's sharp. It could be rough. I think it's about five grand. It is a macular. Yeah. If that's like all the time, get worse. 300 or 300 in two apartments, that's a wedge. That's a massive wedge. That's like a couple of salaries. That's like, I have no more birds and flowers, any more basic. Oh, how are we going to live? So supposedly what they're trying to do is, so there's been a sort of, with insurance, there are, shall we say, stories of management agents getting huge kickbacks on blocked flat insurance. So as you can imagine, if you've got a block of, well, like, your block there in the haze, right? Imagine what the insurance is on that. I mean, it's going to be tens of millions, if not more. So when that contract is awarded to an insurer, that's a big thing for that insurer, or even for their broker, right? You know, for their broker, that's a big payday. So there does seem to be anecdotal evidence of management agents getting certain hooks, shall we say, for placing that insurance policy with this broker or that broker or that insurance company. Well, that's the sort of thing that they're trying to stamp out with the reform bill is to make it more transparent, limit, think like, percentages, chargeable on like admin fees and that sort of thing. Yeah. So they can be a wrecked. Yeah. So it should theoretically, same service level should be available. But with a smaller, less executive profit for agent. Yeah. Your point is still valid because if a management agent has been used to getting X amount of profit and all of a sudden the rules say they can now only get 90% of that, you're right. What are they going to do? profit or cut costs. They're going to drop the gardening hours down from 10 hours a week to 5 hours a week, aren't they? Yeah, you're right. Yeah, well that's good. Birds are going to stop tweeting. Yeah. You don't feel like you're in the middle of the city, so it's pretty unreal. It's like on the top of the shopping centre, right? So your lichy is walking around like in a little oasis. Pretty crazy. So let's talk about what you're doing now. Then you do realize, there's a delay, sorry. Yeah, yeah. So you do realize when you have the buskis, the screaming and bonging and everything, that's why we're moving. Yeah, we don't actually, we're not as worried about the gardening. Take it out. Yeah, let's talk about what it is you're doing now. Then we're tight for splitting before we finish. Obviously it's your thing. You know, look about it. We really like scratched the surface of what you know. So tell us what it is you're doing with all that. Next, now it's exciting. Yeah, so I've been, you know, suppose having conversations like this with people in my network, you know, with people like yourselves and, and you know, some mutual connections we've got where I've sort of given some pointers on, you know, how to title, split a block, get the best benefit out of it, introduce them to the right people, show them how to navigate through, you know, gland registry quicker because you don't want to get stuck on the bridge at 12% of, you know, a year when you can get onto your term finance. So I've been helping people do that in, my network has just sort of, you know, doing my bit for the group sort of thing and it's something that I really enjoy doing, frankly, you know, it's like, yeah, making money out of thin air, it's sort of, yeah, it's quite a, it's quite a buzz. So I've now started a, a side business, the title split consultant and, awesome. I'm now working with clients to help them with their sort of, their purchase of blocks of freehold flats, had fine blocks to split and effectively, I'm sort of offering a number of products. So I, if we're sort of offer to exits, sort of mentoring course where somebody that's got a block of flats, they know about time splitting, they just want to be guided through it the first time because they know those, it falls, there's, you know, potential for delays and they don't want to, yeah, they don't want to get caught up in that. And I can sort of navigate them through introducing to the right professionals, you know, learn from the things that I've found out over the years. And I'll sort of get them all the way through to clearing their exits, and ready for that move on to mortgage finance at the end. So I sort of started with that product and then people said, but we actually don't know how to find a deal in the first place. So I was like, okay, good point. Well, I'll teach that a bit as well. So I sort of bolted that onto the start and that's now offer to exit plus, which sort of yeah, literally takes you from out to find a deal, finding it and then right through to getting onto mortgage at the end. And then just as a sort of afterthought, I thought, well, I'll offer my time out just by the hour as well, you know, just in case that's useful to somebody. And for things like tile split in buy and block, you know, and yeah, I know that's been the most the most used product so far is people just wanting deal stacking out. Yeah, yeah, I mean, there'll be sort of like more hands off investors, people that they're not, you know, trying to educate themselves in loads that they'd rather just pay someone to get it done and get it done work and time is money and all that kind of thing right? So exactly. Wanting to trust someone and get the job done. Yeah. And one of my clients is exactly that. She's, you know, she's not even based in the UK, but she does a lot of deals in the UK and she just hasn't got the time to do anything with the deals that Lanter, she's got an incredible pipeline from being in real estate. So yes, she's now got me looking at, you know, some of her deals to basically do a report on, yeah, you know, this is how you structure it. This is what you'll get for a month. You know, this is how much money you need to put in and, and yeah, I quite enjoy doing that. So it's, it's a nice little addition to my own property portfolio to be doing that for other people as well. Best place to find me for that is LinkedIn. I'm sort of that's my, my favorite place for #thetitlesplitconsultant. Yeah, we'll share it at the end. We'll share it in the, in the last six minutes, whatever the box is called description. Great. I'm rid of this. We'll share it. Whatever the box is. Yeah. Somewhere, yeah, this will be on LinkedIn as well, but it would say, you know, I think it's really committed. It's inspiring to see like your story. One thing we didn't get into quickly, like when you quit your job, this, do you have properties before this one completed? Like, did you have the money to enable yourself to quit? Or did you just like go guns blazing? So we sort of had some. Yeah, I think between myself and Laura, we had, I think it was something like three, yeah, three one-bird flats, two-bird house, and five-bird HMO. I think that was what we had. Which wasn't quite enough. So it was sort of, we needed the next one to land and land successfully. You know, there was a bit of a, yeah, we needed that additional income. So it was a bit of a leap of faith. Yeah, it's crazy. I love it. Yeah, yeah. So what's your goal? Imagine you're working full-time with that deal. Yeah, I'm like, so your answer is 44. What's the goals? On like, is the grid, do you want to keep accelerating that fast? I think that is like one of the most interesting points of this is that the fast acceleration, because so many people dream of having so many units, actually doing it quickly, not waiting years between them is that's the really impressive bit that lots of people are trying to work at it. That was the thing I used to really not understand how do you do more than one in like a year? I never used to get that. So it's such a cool strategy. And the title setting is a big part of it. So you're just going to keep rinse or repeat that same thing. It's a question that we've been starting to ask ourselves to be honest. Like, what is the, you know, where do we stop? What is the top? What do we do? And the honest answer is at this point, I'm not sure. So I'm still looking for deals and people listening to this can send them to me. They want that. Yeah, so I'm still looking for deals for us. I'm, you know, probably even more even more picky now than, you know, that I have been in the past. It's going to be the best to the best effectively. And I do find myself throwing a lot of deals in the bin, which actually are not they're not bad deals, you know, but they're just not the one. I mean, you're right. There is a point where we stop because I mean already at 64, 64 properties that is obviously. I don't know, you know, I have no idea who our tenants are. It's dealt with by lefting agents. You know, sometimes I can't remember how many flats we've got. Thankfully, I never have to touch any keys because that would drive me insane without a Mac keys. But yeah, it's, you know, we're managing the managers at this point. We've got three different locations. And I wouldn't want to open up too many more locations, like maybe more like two tops, because even just having two more lefting agents to deal with would be it would just add to our daily work, very effectively. So yeah, there will be a point where we stop, but we can quite hit it. Yeah, I need to work out where it is. Yeah. Yeah, I guess it's working backpins isn't it from what you want out of what? Not to be too dramatic, but like literally live and what you need to afford it. Basically, that's kind of what our mental tells us with all of our goal setting. It's like, what do you want and what do you need to do that? Yeah, yeah, yeah, yeah, absolutely. Yeah, you shouldn't just be collecting them because you can. Yeah, this is smack smack bang timing an hour. I love it. I think this is, it's been awesome. I've learned so much. I know each making notes. And this is what this is about, like learning, are there are learning free are the strategies. Yeah, yeah, so good because it's there's so many things that you can be doing in property and you know, we're doing service coordination, we're doing amazing. We're both left at jobs, we're selling a bit of portfolio. There's things like this, they're just there, we make three, four, one, two grand of deal and then cash flow at the same time. And you know, frankly, you didn't have that much information, like you didn't have that much knowledge of that and you've learned all of this from one deal and then obviously studying during it. So that's what it takes. Yeah, just this. one fragile to focus and learn and then dive into it and then it can change your life, you know, change your, your own your powers like complete. Now you can soul thing other people doing some amazing things, honestly, inspiring. It shows the power of single one thing, doesn't it? Like it's a really good example of that as well, like not getting so distracted and doing try to do lose different deals and all the different strategies, but the focus on something, become as knowledgeable as you have and obviously there's always learn, right? But like, but then implementing everything, like it within that realm, I just think it's so effective and it's obviously working so well for you. It's really cool. Yeah, yeah, yeah, definitely getting somewhat addicted to it, I would say. Yeah. Yeah, love it, love it. This has been fantastic. Final thing, what is any deals on the girl at the moment or looking for the next one? Yeah, just looking for the next one. Yeah, there's quite a few that I'm looking at at any one time. Got a portfolio that I'm very slowly managing to value unit by unit at the moment and that would be the first non block flat portfolio, which is sort of in some ways is a natural progression. So it's a mix of HMOs and blocks of flats. So yeah, that could be that could be a good one. Let's try to splitting within those blocks of flats. I mean, I could be totally splitting within those blocks of flats as well. Yeah. So yeah, that's an interesting one to try and get. And a lot of that's in the Cardiff area as well. So yeah, might be interesting. Interesting. Quick, go find that. I mean, love it. Love it. We'll look. If anyone wants to find James or Bill is, yeah, we're putting social details in the description. I do recommend just trying to James's. I've seen no knowledge, but this has been awesome. I've learned so many things and those are the other people I love. So I really appreciate time. Come on here. We'll talk very soon. Probably next week. Yeah. Great. Yeah. Thanks for having me on. Appreciate it. No worries. Cheerio.