Exclusive: Q&A with Property Entrepreneur Paul McFadden
Investing in property is generally a good bet but it isn’t without its risks. Paul McFadden, the renowned property entrepreneur, has forged a formidable reputation for his success in the UK market. In this exclusive Q&A, the self-made millionaire shares his hard-won tips about making a fortune out of bricks and mortar the safe way. His new book, Your Property Jumpstart, a practical guide to property investment without money or experience, is out now.
How did you come to work in the property business and what inspired you to do so?
In my late teens I was money hungry. I would be searching online for ways to make money and investing in property was constantly popping up. The Sunday Times Rich list happened to have just been released and there was a fact stated that 85% of the top 100 have either made their money through property or have invested their wealth into property. This was the cue for me to start investigating on how I could get involved in property and make a business of it.
Your Property Protégé courses have become something of a phenomenon amongst would-be investors. Tell us more about the programme and what it offers.
Property Protégé is the absolute top level when it comes to property education in the UK. We’ve been playing this game aggressively since 2006, and have a wealth of real-world knowledge, experience, and a proven track record of results. We’re a deal doing company first, and an education company second, which gives us the best opportunity to provide the highest level real time education to our mentees. We’ve taken all sorts of people from all walks of life, both new and experienced, from across the UK, and turned them into successful, high performance property professionals.
Protégé is the beginning, the middle, and the end. Nothing is left out. Everything is given. Whether you want to go full-time in the fastest time possible, create a six-figure income, build a seven-figure portfolio, replace your pension, or even supplement your existing income alongside your current career, we can walk you through it.
Of the different types of property investment, which offers the most risk-free potential to novice investors?
When people think about investing in property their first thoughts are generally buying a property to rent out to a tenant. Those who are interested in developing property think about buying a property to renovate and sell. Both of these routes come with risk, the level or risk can be reduced or mitigated altogether providing the correct due diligence is carried out and emotion doesn’t enter into the equation. With this in mind what I always recommend to those thinking about or just starting out in their property journey is to start by property trading. This is where you source a property and sell it onto an investor. You are not buying the property for yourself simply just finding an investment opportunity and selling that on to make upwards of £5,000 per property trade. This will allow the new investor to learn the property game inside out and will require no starting capital and zero risk. This strategy is a core focus of our Property Protégé program and one that helps people replace their income and become financially free in very short period of time compared to building a portfolio, or buying to sell, both of which should absolutely still come, but only after creating the initial cashflow required to get started.
We all know that London offers good returns to those who can afford it. But what about elsewhere in the UK? Are there any property hotspots to look out for?
There is a misconception that buying in London provides good returns. This simply isn’t true. Up until now late 2018 those that have been investing in London have done so not for the rental income as the yield is so low, and in some cases, non-existent i.e. a negative yield. This hasn’t been an issue because London has out performed the rest of the UK with strong capital growth. However, over the last 12 months and with the continued uncertainty around Brexit, London’s capital growth has slowed and in certain locations house prices have dropped. Solely investing for capital growth is a completely flawed strategy. When the housing market takes a turn it will take you out of the game. Now with the bank of England increasing the interest base rate the London market will continue to suffer as the profit on rental income will diminish unless investors have kept the mortgage loan to values lower meaning they will have a lot of personal cash tied up in the property meaning they aren’t able to utilise those funds to continue to invest.
What are your top 10 tips to becoming a property investor?
- Work on your mindset.
- Always do your due diligence.
- You make money when you buy; always buy at discount and look for properties where you can add value.
- Always buy in an area with high rental demand.
- Buy for cashflow.
- Have an element of property trading in your business
- Invest in property for the long term
- Build a strong power team of property professionals to assist and support you
- Find a mentor who has achieved what you want to achieve to help you fast tack your journey and to learn from their mistakes.
- Master the art of raising finance; this way you’ll never need to use any of your own money