How I Would Invest £35k – 3 Strategies

The other day, I was asked a really good question by a guy who wants to start property investing and has saved up £35,000. So it was on one of our one-to-one calls. Where he asked me how would I invest £35,000? And that really challenged me because it made me not only think back to when I first started property investing but also put myself in the shoes of other people that want to start property investing and also that our existing property investors that want to expand and grow. 

So as everybody knows I offer one-to-one discovery calls. Well, I call them discovery calls anyway because it’s for me to discover other people and other people’s situations.

And some people use those calls for advice on property investing and landlording. Other people use them for property investment strategies, tips and hints, and some people use it to explain their situations and get my advice on. 

Other people actually use it for data. I had a call the other day with a guy who wanted me to go through some data with him, which is quite interesting. Anyway, so one of those one-to-one discovery calls, this guy says to me: “Hey, Tom, so I’ve saved up £35,000 of my own money completely independently and I really want to get into property investing and I want to use that money for it but I’m nervous about first of all finding the right property, second of all having the right strategy.” But he’s also nervous about generating a profit quickly enough. 

And that’s a very common thing right? If you’ve got about that sort of money anything between £25-50,000. Obviously you want to make money quickly enough to be able to reinvest and grow and that’s generally the thing. 

But look, we all know that that level of investment isn’t going to be a real quick generate 10 properties straight away, but there are certain options for you. Now, the reason this challenged me is because like I said, it made me really put myself into the shoes of other people at property investing. 

So I came up with a couple of options. Now I do have an unfair advantage; I know a lot of people in property in the property industry and the property finance industry. So I tried to make it that I didn’t have any contact. I didn’t have any other money. I didn’t have any sources of funds because I get people offering me properties a lot, property investment deals a lot and I also get people offering to fund my property investment deals a lot. I also get a lot of offers for joint ventures as well. 

So it would be unfair if I just said: “Well I’d take that £35,000 I’ll go and speak to all my friends and then make a ton of money.” And so I started from scratch in my own head in my imagination this is. I started from scratch and I put a little bit of a strategy in place for this guy to follow and I’m not going to mention any names. But anyway, the first thing objective number one is actually I would want to turn that £35,000 into about £50,000 or £60,000. First of all, and as quickly as possible. 

There are by the way a couple of different options here. We’re going to go through rapidly increasing that amount of money that you’ve got. Second of all we’re going to go through finding joint ventures and investors and funding partners that can fund lot more deals for you and third of all we’re going to go through what to do if you only have that 35 grand nothing else, no more, more support, no more joint ventures or anything. So those are the three options. 

First of all, let’s turn this money, this £35,000 into more money. Now, I would immediately start looking around for areas in the country that £25,000 would be approximately a 25% deposit. Now know that I’ve said 25 grand there and I’ll explain that. So if I’ve got £35,000 and I’m going to buy a property the chances are I’m going to spend about £2-4,000 on stamp duty. 

I’m going to spend about £1000 on legal fees another £1000 on finance fees like a mortgage broker your arrangement fee your survey maybe another thousand maybe two thousand on that depending on how you buy it. So you’re going to be looking at a good sort £6-7,000 just on fees, stamp duty, legal fees, and buying finance fees and all that. 

So also you’re going to need a little bit of money left over just in case you need to do any light refurbishments as well. So therefore I’m leaving £10,000 out of this and using £25,000 as a deposit roughly. 

Now, I might be able to do something for less than that, which would be a bonus. But there’s a couple of rules we need to play by here. If you’re going to buy a low price property then the mortgage lending minimum is normally about £50,000. So that’s normally the minimum loan that lender will provide, so remember that. So if I’m going to use this as maximum numbers, then it looks like I’m going to buy a place for somewhere around £100,000. I might get a lot less than that, of course, but if I buy a place for £100,000, I needed a deposit of £25,000 and then I’ve got my legal stuff covered, my stamp duty covered, financial fees covered, and then I’ve got a bit of money to spend on it, do a bit of graft, get it up together hopefully to resell. 

So if I do that very quickly, then I’ll be able to immediately turn £35,000 into you know. Actually, let me just step back a bit because if you’re only going to do a very light refurb the chances are you’re not going to make £30,000 profit on a property. A £30,000 profit on a property normally means you’re going to do a full refurbishment. 

Now, I’m assuming by the way that you’re not a builder or something like that. That kind of negates it. I’m not a builder and this is what I would do, right? So I’m not a builder. I wouldn’t go in and do all this work. I might go in and do a bit of the graft myself to try and cut back the labour costs, but generally speaking I would go in and do a light refurbishment on a property and hope to make between around £10 to £15,000 in profit. 

Now, how would I find those properties and how would I find those areas that I think that would be a good demand area a good growth area or an area that I think would be a popular sales market. So look, you’re going to need to do a bit of research on this. You go around the different pockets of the country and I would start by identifying the major cities and go in look at each of those cities. And see which ones have huge demand at the moment for properties in their city centres. 

And here’s a little tip on this right. So you find those cities that have massive demand in their city centres. And then you look just on the outskirts of those cities because if property prices are rocketing up in city centres, then people start looking slightly out of those city centres for accommodation or somewhere to live. So that means the outskirts then start driving up demand, but you can normally catch that wave and pick up a little bargain while that property area or that area is on the increase. Anyway, by the way, I have done a podcast on how to find growth areas, high demand areas, and how to analyze the data and find the data so I won’t go through all of that now because it is its own episode. 

But anyway, you’ve got to find an area of the country that’s in high demand and is going to be a good growth area. So once you found that spot you can then start looking for the properties. Now, you’re a little bit limited on price. So you’re probably not going to be investing in the South and Southeast. You might be able to invest in parts of the Midlands, Wales, Northeast, Northwest, but you certainly won’t be able to go anywhere in the bottom in the country. 

Now, let’s just say we found a couple of growth areas and high demand areas and we’ve identified a couple of run down properties that just need a bit of TLC, light refurbishment and you’ve done your due diligence. And remember I did that episode on due diligence. That’s another episode on its own which I can’t do on this one. But you’ve done your due diligence the necessities of due diligence as well. Please don’t get the due diligence wrong. That’s so important. I see people get it wrong so many times. But you’ve done your due diligence and you’ve identified. Hey, here’s let’s say 10 properties. We’ve found 10 properties, which I think are good Investments. So I found 10 properties let’s just say, which I think are half decent investment opportunities. I’ve done my due diligence they all tick the boxes and then I contact all the agents and I book the viewings in of course. So I try now I’ll make myself as available as possible because I want to get into these properties quickly and there are loads of ways even on Rightmove that you can find properties that are good Investments and perhaps open to lower offers. 

Again, go through that another time. But for now, let’s just say I found 10 properties. I think are good investment opportunities. So I booked the viewings and I’m so flexible on the viewing times. I’ll get out to these viewing time whenever an agent wants me to get out to them. I go out to these viewings and I do my little checks on the property to check for any damages, or any structural issues, anything I can identify and remember I’ve got my checklist. You’ve all seen that video. I’ll go through that checklist just to make sure I’m not buying a dud. Now out of those 10 properties I would expect to make an offer on eight of them. Remember my 80-20 rule so I would expect to make an offer on eight of those properties. 

And out of those eight properties I would expect to have two offers accepted. Now, here’s my dilemma and this leads on to option number two. So let’s say out of those two properties that I’ve had an offer accepted on. I buy one of them myself, of course because I’m going to make about 15 grand profit. I expect £10-£15,000 profit on that. 

However, I now have another really good property investment that has a sale agreed, a really good price. So now I can’t buy both because I only got £35,000 and I can only afford to buy one. So I go back into all the Facebook groups, all of these Facebook pages and I start saying: “Hey, I need some help. I found this property. I’ve had an offer accepted of £80,000. It only needs a few grand spent on it and I’m looking for either somebody who wants to buy it or somebody who wants to fund me buying it.” Now, then you start giving them the correct information IE, the job done valuation, the work required, a schedule of works, your data for the demand for the growth, and all of those things. You’ve got to give any investor or investment partner that information. 

Now once you’ve gone into those groups and you’ve issued out that information. Bear in mind I don’t know anyone. That’s that was the story I don’t know anybody. You’re going to get bombarded by property sourcing agents who want to then resource your sourced property that might not be a bad thing. 

But you’re also going to get a ton of people that are phony that want to pretend that they’re going to invest in your property. You will get contacted though because what you’re doing is offering people an opportunity to make some profit and everybody loves profit. So now I’m moving on to option number 2, which is too so bear in mind. I’ve put this first one. That’s my first property done that is going to generate me 15 grand. It’s going to turn my £35,000 into £50,000 and now we’re talking. 

Now, I can start buying a buy-to-let property and doing another flip. I probably should have wrapped that up first. So yeah anyway, so I’ll turn that money, that £50,000 I’ll then by another flip do the same thing and then try and invest the rest in a buy-to-let property maybe or might do two flips and try and make a bit more profit. But then so I’ve put this second property out to investors and for investment and I’ve been contacted by people that are interested in either, let’s just say actually it’s more realistic that you’re going to get people that want to buy it.

Not invest in you, more people want to buy an investment property than want to invest in you buying an investment property, so let’s just say that. So you get contacted by saying: “Hey, yeah. I’m interested in that property. I’ve been looking for that, for a property like that to invest in.” Now, let’s just again assume that you’ve found this person a property that’s going to make them £15,000 profit. You say to that person: “Sure. I’ll package this up for you and I will connect you and you can buy the property. Before I do that I’m going to charge you 3% for this opportunity or 3 grand or whatever it may be.” If you’re going to charge £3,000 then great. 

You make sure you connect up the deal get the buyer involved, sign something with the buyer to say that he agrees to pay your fee of £3,000 and then you’ve just made another £3,000 for doing nothing. So this is what I would do by the way. And then I would repeat.

So I’ve got one property deal going through and there is a bigger picture to all of this. I’ve got one property deal going through that’s going to make me £15,000 profit and then I’ve just made another £3,000 because I’ve given this property to this other property investor. And now I want to talk to this investor and I wanna say: Look, how many properties you’re looking to buy? And he’ll say: “Oh, you know, I’ve got £100,000 to invest.” “Okay. Well look if I come across any more properties like this, would you want more?” “Probably yes.” So now you’ve got an investor on your side. So I’ve got my £15,000 coming in from property number one. I’ve made another £3,000 from property number two. All right, it’s not a great deal of money, but it’s something for nothing, right? And now I’ll go out and view another 10 properties and then I’ll do my 80-20 rule. Out of those 10 properties I’ll probably make an offer on eight of them and out of those eight properties I will probably have 2 accepted. So now I’ve got a property investment partner. So I offer it again to him and he says: “Yeah great. I’ll have one of those brilliant.” So he’s buying that one that’s another £3,000 in the pot for not a lot. 

But now I’ve got my £50,000 back so now my £30,000 or my £35,000 is now £50,000 and I’ve already got another property to invest in. So sale agreed go. So I’m going to make another £15,000 on that. I’m going to make another £3,000 on giving the other property to the investor. So immediately my money’s going up to about £71,000 and now we’re starting to talk. This doesn’t take very long by the way. So now we’re talking about £71,000 in my pot. Well, there and thereabouts. Obviously I’m generalizing this because there are fees involved and you always have to pay out fees. So might not end up being £70,000. It might end up being less, but I’m just making figures up here you get the strategy. 

So strategy number two is just that. I would be investing in property myself as and when my cash flow allowed it, whilst continuing to go out viewing properties and I’d be viewing 10 a week. 10 a week. And yes, I’ve got a full-time job, but you can still view 10 properties a week. You can see 5 on a Saturday and 1 a day during the week if you really want to. If you’re serious about making money if you’re not, then go and see one or two properties and it will just take a lot longer that’s all. So yes, I would continue going out to 10 properties a week making 8 offers a week and I would get 2 of those sale agreed and out of those 2 properties sale agreed. 

I would try and buy one myself, but if I can’t buy one myself, I would be offering it to other property investors. Simple as that. Rack up your pot, your cash pot until you’ve got enough in that pot again to reinvest and then you’ve got your property that you’ve done a flip on. You reinvest that. And then eventually you’ll get to that stage where you’ve got enough money in your pot to be able to start by refurbished or refinancing. And that’s a really good way of quickly ramping up your portfolio now. 

That’s where you buy a property, you refurbish it to add the value, and then you refinance that value back out. So effectively you buy a property then get all your money back and you keep the property. Now, of course, you’re leaving a lot of equity in there. So you always have that to fall back on. But you are accumulating your portfolio and then generating net profits from the rent. So from there and that’s when we can get into buy refurbishing and finance. 

But for me personally, I would be doing both. I would be doing flips so that I can ramp up the cash pot quickly again and then reinvesting. And then when I get to a certain level owed by refurbished refinance and I call it flip to let but it seems to be more common to call it by refurbish refinance and then I would buy more properties, accumulate more portfolio, do more flips, do more portfolio, do more flips, more portfolio, more flips, continuously. So my cash pot is rocketing upwards and my portfolio is rocketing upwards. Now I mentioned about my property investment partner. The guy that I’m giving property investment deals too. Now, that’s great. 

So now if I’m ever not buying I know I’ve got an outlet and you might well get to the stage where you need a few property investment outlets. So investors that want to buy properties and are happy to pay you a few grand to pop. Now bear in mind if you come across a particularly big deal for somebody they will pay more if they’re going to make a ton of profit. They’re going to make £30,000 profit they’re probably won’t mind paying you £5,000. And if they don’t begrudge that if they begrudge paying you £5,000 out of there £30,000 profit. Move on get someone else. There’s enough money in property for everybody to make profit and it’s just silly and greedy if people think otherwise. So now you’ve got your cash pot ramping up through flips, you’ve got your portfolio ramping up through buy-to-let and and buy refurbish refinance, and you’ve also got an outlet who’s going to pay you £3-5,000 for every property you give them. 

Because you’re continuing by the way, you’re going to carry on doing 10 viewings a week, 10 viewings a week, 10 viewings a week. 10-8-2, 10 viewings, 8 offers, 2 accepted. So now we’re moving to a bigger picture. Because you’ve got that little set up beautifully and that by the way, if you do that properly you will end up with a serious amount of money coming in to you. I promise you. If you don’t do it properly then of course, you won’t if you don’t stick to those numbers or more then of course, you won’t and everybody can work at their own pace as you can see. It’s just time scales that change if you do this as fast as I would do it, then you would make a good amount of money. If you do this slowly you will still make money but over time. If you don’t do it at all you won’t make a penny. 

Anyway, so next we want to start scaling up and what we’ve done is we’ve built this beautiful little property business right? Where we’ve got properties that we’re buying. I’ve got properties that I’m buying and turning into more cash. I’ve got portfolio that’s generating cash flow and growth and appreciation. Sorry, appreciation in value and I’ve got an outlet someone that will I from me.

A really good little structure and a base foundation for a property business. So now that’s all in place. I’m going to start increasing and I’m going to scale up my business now. And that’s when I start going out for joint ventures because I promise you if you continue to go out to 10 viewings per week, 10 viewings a week, make 8 offers. Don’t be greedy by the way. And also there is that podcast you must listen to which is how to make offers through estate agents and there’s a video of that one as well. So if you don’t listen to podcasts watch the video it’s on my Facebook page. So yeah, don’t be greedy just make your offers and you’ll get your 10 viewings, 8 offers, 2 sales agreed. So now we’re going to go bigger. If you keep doing that you will be offered bigger deals, bigger plots, bigger projects, bigger property profits. 

So you’ll start getting into the big refurbishments where a house for an example needs a full renovation top to bottom, back to front. 

Now when you start getting into those if you haven’t got enough cash yourself, this leads us to option number three. Which is where I will go out for joint venture partners and joint venture partners is what’s going to separate you from making good money. From you making great money because now you can start going for bigger deals, bigger projects. And bear in mind don’t be scared of these things either because a bigger project is exactly the same as a little project it just got an extra zero on the end, nothing more than that. You’ll still have the same problems, still the same challenges, no issues. So anyway, yeah, we’re going to go after joint ventures. Now, you will I promise you, you stick to those numbers you will be off of those bigger deals. Find one of those bigger deals now go back into those Facebook groups and say: “I’m looking for joint venture partners. This is the deal I’ve come across.” Package it up give the main information that property investors would want to know. And once you’ve package that deal up, you’ve put it out into those groups. You’re going to start networking with those people now. 

Now here’s another little thing if you’ve been doing this correctly you will also just by default just meet other property investors, property sources, funding partners, joint venture partners, you’ll just meet them if you want to if you put yourself out there to do that. So now you’ve got, let’s say I don’t know a big massive great big house and there’s the opportunity or big building and there’s the opportunity to turn it into four flats, let’s say. But you haven’t got enough money yourself so you go out to a joint venture partner.

Now, I’m going to split the joint venture thing into two. Because part 1 of finding joint venture partners is where you go and find one person. So you have you. Oh sorry I’m talking about you again. Me, so I will go and find either a joint venture partner so it’s just me and the joint venture partner. The joint vent we just split 50/50 down the middle in cash and then we split the profits 50/50 to simple as that. We also take on the liability 50/50 we share the risk 50/50 simple. 

But option number two is you have multiple joint venture partners. Now, here’s a hint make sure you are already or it’s all agreed amongst you in the joint venture partners that you are the lead, you are project manager, right? So that then you’ve already preset in advance. This is the schedule of works, this is what everybody is investing, this is what we were intending everybody to get back, these are the comparison quotes of job done valuations or gross development valuations, GDV. 

And so basically all the information and evidence out there to show what the plan is, but you must insist that you are taking the lead on this. So you will be the one that solves problems. 

You will be the one that decides what colour carpets and all of that and the others must agree to that, otherwise they don’t join you, simple. There is a reason for that as well. It’s because if you’ve got too many people arguing all the time property deals just don’t get done. So yeah, so of those two things again, I would put myself out to the group. So I would go out to networking events and property events and so on just trying to find joint venture partners and that’s when we start making some serious money. Now, there’s a bigger picture even more here, another bigger picture. 

I love a bigger picture because you now have experience. So you can start approaching other bigger investors and show them: “Hey, this is a block of 4 we developed. Here’s 10 properties I flipped myself. Here’s another 10 properties. I passed over to Mr. and Mrs. Property investor here. Here is his 5 properties that me and this single joint venture partner did.” You’re showing diversity and real investability. That’s a great word investability. Shows that somebody can invest in you reliably. 

But anyway, so those are the three options. So just to summarize first of all, I would turn that £35,000 cash pot into more and I would do that by flips, and when I get enough properties I’ll pass additional property investment opportunities to other property investors in return for a fee to continue building up the cash pot. And then once I’ve built up a cash pot I will start doing by refurbished finance and building up my portfolio my cash flow. 

I’ll only do that if I can get all my money back out though, and I will only do that whilst I’m still doing flips. And then I will start going out to joint venture partners and start going out to multiple joint venture partners so that I can do multiple deals as long as I am the project manager in all of them. I’ll have multiple deals going through with joint venture partners, and I will effectively start really ramping up the cash, ramping up my portfolio and my cash flow income. And that’s how I would do it. So look there was a lot of waffle there I just made it all up from the top of my head and I hope it helps. 

I hope it gives you all a bit of an insight into how you could do it too and you could do it the same way. You don’t have to do it so intensely, you could do it over a shorter period of time. But overall, it’s actually really easy to get into property investment, but there is a major of fear element. 

People, I relate to it, you know, you’re just scared of making mistakes. of course you are. But try to remember if you don’t start you’ll never get anywhere. If you don’t go for something then you’ll never go anywhere. And the worst that can happen is that you lose a little bit of money. But remember if you’ve saved up that money then technically it’s dead cash. You can afford to lose it because it’s just saved up. 

Now, I’m not saying you will lose it but you need to understand that I could lose this but you wouldn’t lose any more than that because we’re going to do this. I would do this in a way that protects me. I would raise finance through mortgage lending and bridging finance and investment partners and I would protect my own risk so that I know how much I stand to lose. 

Anyway, I hope that helps and remember look in all of this is just one more thing. And if you’re going to be the best version of yourself in one thing, you’ve got to be the best version of yourself at everything. So keep learning, keep developing, keep enjoying, and do whatever the fuck you want to do, and don’t be scared. If you are scared then feel that fear just understand: “Hey, yeah, I’m scared of this.” And then do it anyway.