My notable property person today is Welsh landlord Jayne Goodrick. Here is her story.
1. Please introduce yourself. Say a bit about yourself and your company
I was born in Manchester and brought up in North Wales. My schooling is only up to O level (I dropped out of A levels to start work), but I have spent most of my adult life continually studying one subject or another.
My husband and I have built our property portfolio around the North Wales area to a size where we now have enough to maintain our lifestyle without having to look for an income elsewhere.
We mostly rent out standard 3 bedroomed houses, as we decided that we wanted tenants who would be more likely to remain in one property long term, and we have found that our tenants, mostly families also want the security of a long term let. Flats and smaller houses have a higher turnover of tenant, and we are not inclined to the extra hassle involved. Our longest term tenant is 14 years.
2. How did you first become involved in property?
I had a son and wanted to move to a larger house with a garden, but the sale of my house fell through. Rather than lose the house I wanted, I took a mortgage which was to the maximum that I could afford (and this was when the base rate was somewhere up near 15% mark!). But this allowed me to keep the first house, which I then rented out, and that was the start of it.
3. What do you think is your greatest achievement so far?
My greatest achievement came when I found myself temping for the local housing benefit office (complete coincidence, I might add). At the time I was running my lettings business with about 4 or 5 houses, I was self-employed with my own property related consultancy, again, another coincidence, and I needed the temping wage as a steady, regular, guaranteed income, but one that gave me the flexibility to continue with my consultancy.
I decided that rather than running around trying to keep all the balls in the air I needed to position myself so that I had enough rental income to sustain us through any times where we might have a property empty, or someone couldn’t/wouldn’t pay us, so I set the goal of owning 10 properties.
This was achieved very quickly, usually buying 2 per year. We now have 20 properties and our time became our own allowing us to commit the time to expanding my other businesses. This also gives us less stress as any maintenance is undertaken at our convenience, not late in the evening after a day’s work. This is also more convenient for the tenants as we can be more flexible when arranging the appointments.
4. Do you or your company have any exciting plans for the future?
It is not ideal to have all your eggs in one basket and so our plan for the future is diversification.
We have decided to stop buying now (unless an absolute bargain comes our way, of course) and we are now looking into other investments that can yield us an income without all the hassle and uncertainty that comes with rentals. We are not getting any younger, and I am fed up with chasing rents, chasing housing benefit, the state some of the properties are left in when vacated.
I also going to concentrate on becoming more closely involved with the various agencies and housing departments that are out there for the tenants. I want them, the agencies, to appreciate the private landlord’s point of view. There is a perception that we are all bad people and only interested in the money.
As an example, I attended a meeting with our local council and various housing agencies. I was the sole private landlord. The complexities of LHA came up and I explained that a number of my tenants were having difficulties due to children leaving home and benefits affected. The solution around the whole table of 12 was to ask the landlord to renegotiate the rent. I pointed out that if those around the table were also prepared to take a cut in pay, and if the mortgage companies would also renegotiate down, then that might be an option. I was met with silence.
They did not see that providing a family with a safe haven, a roof over their heads, maintaining that roof and all under it, is as much of a service as the local social housing providers, only without their guaranteed salary every month; that the rental income is not going straight into my pocket for pin money, it is earmarked for mortgages, insurances, safety certificates, maintenance etc. Oh, and if any is left over, then a wage for providing all this would also be nice!
5. What do you think are the greatest problems facing the private rented sector today?
The legal system as it stands is totally in favour of the tenants. Whilst I am too young to remember the precarious position of private tenants pre-1980’s, the pendulum has swung too far.
The current legislation is not so much in favour of the tenant, but against the landlord. The amount of hoops a landlord needs to jump through in order to regain possession of a property HE owns is unjustifiable, whereas a tenant can move in, pay nothing, destroy a property, and just walk away with at the worst nothing more than a CCJ. And that’s only IF the landlord can afford to take it that far.
6. What do you think are the greatest opportunities?
As there are such difficulties in raising finance currently, to be cash rich puts you in an enviable position to be able to move on an opportunity as it arises. For the rest of us, things are not quite so smooth.
However, faint heart never won fair lady. Builders’ are not selling their commodity as readily as before. There are opportunities to be able to come to agreements with smaller building companies where you could buy several properties for a very reasonable price: you get cheap houses, he keeps his business turning over, and the end result is available housing. It’s a win-win for all: banks lending, money back into the economy, turnover for the builder, and income and capital appreciation for the landlord.
It needs to be a long term view, as the ‘buy now sell next month’ era is over. Very selfish and money minded? Well, we are running a business just as much as the builder or the bank. The purpose of our business is to provide the end user comfortable housing for those who are unable to provide for themselves, so why is taking a wage and a profit so bad?
7. We have a new government. What would you like them to do for the private rented sector?
See 5 above. We need reform of the current legal system. We need a system which is fair to BOTH sides. Redressing the current imbalance could increase the rental housing stock.
When I am asked advice about the legalities involved in renting, and ultimately the position if things are less than perfect with the tenant, I am honest about the difficulties of extricating a difficult, obstructive tenant from YOUR property; about the costs involved; about the time scale involved; and this puts off those who need or would like an extra income, or people who may be considering taking control of their own financial status due to redundancy or whatever.
Someone would not want to risk their own home by investing in something that might not yield an income, and may even cost them in repayments and legal fees because all the cards are stacked against the landlord. There is an unused pool out there who are keen to provide the much needed accommodations, but who are too intimidated by the potentially precarious legal position to make that investment.
8. Do you use social media (blogs, twitter, LinkedIn etc)? What place do you think it has in the future of the property industry?
I purely use the internet for browsing when I need to find information, my banking, my emails, and Landlord Law of course, and, so I have no answer for this question (40 something, for those wondering).
9. What is the most important lesson you have learned during your time in property?
Never, never, never take your eye off the ball, be naive, or allow things to slide just because you are busy elsewhere.
I relate this mainly to the income, as without this you and your family may also go under, but the same is true with regard keeping up to date with current legislation, maintenance of your properties and tenancy agreements. Don’t allow yourself to be caught out by any bombshells, financial, legal or physical (of YOUR property).
When something goes wrong, make sure it is not your fault, that you have done everything and more required of you, legally or otherwise. If you do come seriously unstuck, it is usually of your own making by not being on the ball. So make sure you are!
10. What advice would you have to someone thinking of entering the property industry today?
Please read the above answer again. And again. And once again whenever you take on a new tenant. This is your job. Enjoyment in your work is essential, and when you are paid to do what you want to do, what more can you ask for? Take your job seriously but remember to have fun with it. When it works, it works very well!
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Thank you very much Jayne for your thoughtful comments.
Do you agree? If you have any thoughts on the matters raised here, please leave a comment below.