I just visited Spain this week on a non-property related business trip but could not resist the opportunity to look at what their property market is currently like. As many of you know, when asked about the Spanish market over these past few years I have issued warnings and have strongly recommended doing your due diligence. Having been down there this week – my I can confirm that my warnings were correct.

Remember:overseas property investments require due diligence and a clear evaluation of the Market.

Alicante – Benidorm

These two cities are still a popular spot for the British, and it would appear that to combat the recession, the hotels and restaurants have dropped prices in an attempt to attract the masses. It seems to have worked. However, the property prices for investors have been hit hard. Whilst the restaurants and hotels may benefit by reducing prices, the property investors are struggling. Talking to locals and investors in the area, it was clear that prices in Alicante (in specific areas) had dropped by up to 60%. In the areas where there are less tourists and more owner occupiers, the drop was less radical, around 30%+. In Benidorm the figures were similar, maybe more in the region of 40% drops. Speaking to locals, they felt it would be a long long time before the prices get back to what many of the new-builds were sold at.
For investors that have bought, if you do not sell, then you simply have to take it on the chin and rent out. One penthouse (three bedroom) apartment I saw had been purchased by an investors for around 600,000 EUROS and it was being rented for 800 EUROS per month. If you do the numbers you will know that would be a NO NO back home!
If you were to take a long term view and accept that your occupancy rates are going to be lower, there might be some opportunities to pick up heavily discounted properties from severely distressed sellers. Even then, you need to do some serious due diligence to make sure that you are happy with the numbers.
South of Benidorm – Costa Del Sol
I did not get that far south, but from what I could see, they have suffered worse drops in price. Remember that this whole length of Spanish coast line experienced excessive over building, and developers & investors getting greedy. Prices were inflated, buyers overstretched, interest rates rose…and hey presto – the bubble burst.
In a word – my message remains essentially the same. Get to know your market. Ensure the occupancy rates are there. Check the real value. Get good management. And then offer a silly price for the property!!!!

Here is another message for those of you wanting to be Professional Speakers, Public Speakers, Motivational Speakers, Teachers, Educators or simply wanting to develop a greater confidence in front of your audiences… PASSION.

As you look ahead into 2010, I would like you to consider what TOOLS you need to have in place in order to create more passive income and to be able to buy more houses without using your own money.

So, after an amazing last night at The Berkshire Property Meet, I am BLOGGING here from Spain and wanted to clarify the details of some exciting Webinars I will be running next week:

Monday February 1st @ 8pm

How to make a high yeild hands off return from the Money Markets – totally passive. This is very exciting folks. For many of you who have some funds or access to money, this could be an excellent way to add a very strong passive income to your lifestyle.

Click here to register: Hands Off Income Webinar

Tuesday February 2nd & Thursday 18th Feb @ 7.30pm

Following some great feedback from our recent webinars on Sourcing & Bridging we are running two more webinars in February. Learn essential tools for Sourcing properties yourself and others from Raj Deb. In addition, the second half off this webinar will be a breaksdown of how you can use Bridging Finance to do no money down property deals. This is one to to see!

Click Here: Sourcing & Bridging Webinar 2nd Feb

Click Here: Sourcing & Bridging Webinar 18th Feb

In what has been called one of our coldest winters in the last 100 years, I thought I would take the opportunity for all those of you wanting do more Public Speaking or wanting develop your professional speaking skills to film a few short live videos. Each of these include a few key tips on how to present and I thought doing it in the cold and snow would help you see that this is a skill you can use anywhere!!

For those of you who attended my recent presentations at the Berkshire Property Meet and Financial Independence Day, many of you were asking about the Income-Expenses-Assets & Liabilities spreadsheet that I was demonstrating as a great tool for reviewing your personal finances. You will pleased to know that anyone who has registered on my website – will be receiving the spreadsheet shortly.

This a simple template for you to experiment with – for those of you who really want to work on this area of your life and feel that it is a block then I would recommend keeping an eye on my BLOG as I will posting on this over the coming months. If you require coaching on this area you can contact me through the Contacts page to see how I can help.

I have for many, many years been a huge fan of the great LES BROWN. Many of you who have seen me speak will have heard me refer you to his material, books and audios. I was recently sent a link by an old friend James Richardson with Les speaking and it put a huge smile on my face.

One of his recent blogs struck a powerful chord with me, and one that anybody who is wanting to take their life to another level should have in their hearts – living on PURPOSE. For those of you out there who are speakers and teacher – this is a message you have to share with your audiences. A question to ask yourself and others is ARE YOU ON PURPOSE with you life?

You can visit LES BROWN at:

http://lesbrownblog.wordpress.com/2009/06/10/get-back-on-purpose

Here is an extract:

Get back on purpose!

Keep the main thing the main thing. We can so easily get off course! Make a deliberate effort to stay on course and take care of business today.Do something important today on your goal, on your dream and experience the feeling of accomplishment.

I was just on Brian Tracys Blog:

http://www.briantracy.com/blog/

The message here aligns so strongly with my passionate beliefs about the importance of working on our relationships as a foundation to our core happiness. Most importantly, start with yourself, develop that relationship such that you are growing and nurturing the beauty that sits within you. This will in turn allow you to overflow and attract others to you who are in alignment with your soul and core values.

Here is an extract from Brians Blog:

According to psychologist Sidney Jourard, fully 85 percent of your happiness in life will come from your personal relationships. Your interactions and the time that you spend with the people you care about will be the major source of the pleasure, enjoyment and satisfaction that you derive daily. The other 15 percent of your happiness will come from your accomplishments. Unfortunately, many people lose sight of what is truly important, and they allow the tail to wag the dog. They sacrifice their relationships, their major source of happiness, to accomplish more in their careers. But one’s career, at best, can be only a minor source–and a temporary one, at that–of the happiness and satisfaction that everyone wants.

I have just been emailed by two of my recent Rich Dad students who are really focused on making their property business work. They are asking all the right questions too. This one relates to how much profit they should be making on their refurbishment projects. This is not a straight forward one to answer, so I have put some considerations down that anyone doing such projects needs to be aware of.

In answer to your question about the returns you are looking for on a refurbishment deal, you really need to consider a few of the following things:

1. What return on your investment are you looking for? If a deal requires you to put in £50,000 and you decide that your minimum return on your money for these types of deal is 50% then you would be looking for a profit of £25,000 or above.
2. Remember there is also a time element attached to this – are you doing the work yourself or is someone else doing it?
3. Some people look for a net return on the final sale price. This varies, some might want a minimum of 10% of back end price as a profit, whilst others look for 20%. E.g. A back end sale price of £150,000 with a 10% return on this price would be £15,000. Others want the profit to be measured as a return against the money they put in.
4. Another factor is the level of discount you get on the deal. If you pick up a distressed property with a market value £130,000 (in a distressed state) and the seller is distressed then you are likely to be able to offer less. Lets say, in good condition its worth £155,000. It needs £12,000 of work on the property. The seller and the property are both distressed and the seller wants £130,000. At this price, you are not going to make much more than about £5,000 – £8,000 after costs etc. So you have to negotiate. If you get it 20% BMV (£104,000), now you have some room for slippage on your end profits:

You will likely put around £28,000 or so for the purchase plus your work (£12,000), so you are in for £40,000. With the work and a few other costs your total cost is £104k+£12k+ say £3k Misc = £129,000. This gives you around £26,000 to play with on the profit side. If you decide you want a 50% return (£40,000 in x 50% = £20,000 profit wanted) then you set your lowest sale price at £129,000 + £20,000 = £149,000.

A gentle reminder, if you were to use creative finance such as the Closed Bridging that we have available, then you could bring down the amount of money needed into this deal to between £5000 and £9000. That would mean that with a £20,000 profit, your return on investment would be over 200%! (£20,000/£9000 > 200%)
For those wanting to know more about this – we have a webinar on 14th January at 7.30pm on Sourcing and Bridging Finance. Visit here to register:

Register for Souring & Bridging Webinar: CLICK HERE

So you can see that the answer is never straight forward and depends on your approach and needs at the time of doing the deals. I believe that if you are working a specific template (model) you will find over time that you will know that for a certain deal the profit will be X% of the sale price. That comes with experience.

Those of you who are property investors will know, in the current climate there are a lot of opportunities to pick up properties well below market value whilst still helping the sellers. Yes, there is word of the market picking up and with the media covering this over the coming months, there will be a percentage of the mass population that will believe that this means they can hang on to get a better price for the property that they are selling. However, the fact is that there are still thousands of people  out there who are in trouble financially or who are just a few months away from getting into trouble if they lose their job or mortgage rates change.

The term “Shortfall” refers to the difference in what you owe on your mortgage and the final sale price of your home after it has been repossessed and all associated sale fees have been paid. According to the council of mortgage lenders the statistic is that over 20% of properties are sold for less than the amount left owing on the mortgage because sellers have left it too late and the lenders have simply dumped the properties quickly through auctions etc.

It is achievable to to pick up properties at 40% below market value in the current climate. Through research, getting out into the market and attending auctions you can pick up these deals. Also, you can use sourcing agents for picking up the discounted deals and there are more sourcing agents emerging around the country. I had a friend contact me recently with five properties that he was looking to sell at a discount because his lender had indicated that they were prepared to knock £20,000 off each mortgage on these properties. That is £100,000 they were prepared to just wipe off his mortgages if he could sell them. That is how desperate some lenders are to get cash back in.

I recently got a call from Mortgage Express to say that they were currently waiving their redemption penalties for Buy-to-Let Landlords who were willing to redeem their mortgages. This could be a good negotiation tool with any landlords you know who want to sell and who have a mortgage with Mortgage Express.

Essential rule: Never be afraid to ask for a big discount.

Thank you for the feedback on my last speaking BLOG and yes, I will be adding more of these public speaking tips over the coming months. What people often forget when putting together a presentation is that the end is just as important as the beginning – some may argue more important depending on the purpose of your presentation.

Closing your presentation is extremely important as it leaves a lasting impression. The last thing you say may be the most remembered. You must put as much time into selecting and practicing your closing as you put into any other part of your presentation. Just like your opening, your closing does not have to be humorous. It could be motivational, challenging, thoughtful or it could simply be a summary of your presentation, or if you are promoting or selling something, then you may want to finish with a call to arms to encourage your audience to make a decision.

Remember – This ending segment will have a strong influence on what the audience takes home with them when you are done. Please, at sometime during your talk ask the audience to do something. If you haven’t asked them to do something by now, the closing is your last chance.
If the subject is appropriate, it is powerful to leave them with laughter or a deep message – just don’t leave it bland!

If you leave them laughing and applauding then the chances are that you have left them with a positive impression of you as they leave the presentation or seminar.  Another good reason to leave them laughing is that the room will not be deadly silent as you are walking back to your seat. Most speakers experience a great feeling when the audience is laughing.
Finally, if the subject is not appropriate to end with laughter, you could end with a touching story or quotation that leaves the audience thoughtful and quiet. Even the most serious public speaking subjects can benefit from humor, but the humor should be sprinkled throughout the body of the presentation.

Always remember – have a clear idea of what your message is to your audience and make sure that when you close they “get the message”.