Spencer and Anita Bowley bless the day they didn't buy a hotel.
In a recent interview with Tony James forMaking Money magazine, the couple explain how finding Platinum Property Partners (PPP) and its unique HMO(Houses in Multiple Occupation) model soon put an end to their dream of becoming hoteliers.
"I was seriously thinking of making a career change from running an IT business, but then we realised that a hotel would completely take over our lives, particularly as we had a young family," Spencer remembers.
It was while Spencer and Anita were having second thoughts about becoming hoteliers that something happened which really did change their lives.
They heard about HMOs. With perhaps five or six tenants in one house, HMOs are not surprisingly a pretty good investment, out-performing ordinary renting and everything from equities and gilts to government bonds and commercial property.
"I had always been interested in the buy-to-let property business and HMOs sounded as if they ticked all the boxes," Spencer says. "Then I heard about Platinum Property Partners and it was no contest, really. That was the end of our hotel dream…"
And the beginning of another dream that has become a highly successful reality. Three years after taking on the PPP Bournemouth franchise, Spencer and Anita have eight HMO properties and several flats with a total of over 40 occupants and are on the look-out for more.
In 2015, they were awarded PPP Franchise Partners of the Year. "That really crowned a fantastic year for us," Spencer says. "It's been tremendously hard work but the results and the satisfaction have made it all worth it. We are really pleased with the way things have gone and what we have achieved in only three years. Thank goodness we didn't buy a hotel!"
The concept of HMOs in the UK was largely created by the 2004 Housing Act and Platinum Property Partners, launched in 2007 by entrepreneur Steve Bolton as the world's first property investment franchise, today has a network of more than 250 partners, employees and specialist property experts in over 100 towns and cities. Most Partners can expect to earn more than £50,000 and an increasing number are earning at least £150,000.
The network of Partners now own a total property portfolio of over 700 HMOs worth more than £200 million and the company has become the UK's fastest-growing premium franchise.
Could Spencer and Anita have built an HMO property empire on their own? "Of course we thought about it," Spencer remembers, "but because of the heavy investment we decided against it and we soon found that it was the right decision.
"From the beginning the PPP organisation gave us invaluable mentoring in house buying, conversion and how to set up a really efficient renting business but perhaps the biggest benefit to us has been the help and comradeship of the other Partners in PPP. It's like being in a club and people couldn't have been more supportive and helpful.
"Profit on one of our average HMO properties is about £2,000 a month. I wonder if we could have achieved that on our own."
With buy-to-let the currently fashionable way of securing a retirement income, the demand for suitable property is fierce. "Nowadays, if you see something which you believe has HMO potential and you're well-funded, you don't hang about," Spencer says.
"For instance, we recently bought a property within three hours of it coming on the market. We knew it was the right decision and we now have the confidence to pitch to potential investors and further expand our portfolio.
"How much more will we grow the business? The market is certainly there and it's a question of sitting down and planning carefully how we want to go in the future."
The newest of Spencer and Anita's HMOs was built in the 1980s and most of the rest are large properties from the 1930s to the 1950s, converted into luxury rented furnished accommodation.
"We're at the top end of the market for professional people," Spencer says. "We put in features like granite work-tops, stylish decoration and sometimes even Sky Sports. With common shared areas and half a dozen people in a house, it's vital that they get on and are compatible.
"I'm glad to say we usually get it right and tenants often stay for years until they decide to take the next step along the property ladder."
With domestic harmony so important, Spencer and Anita aim for single professional people aged from around 21 to 45 (current tenants range from bankers and teachers to policemen) and Spencer hastens to point out that this is in no way discrimination.
"We have found that people of a similar age-group are a better fit for a shared house. In three years we've only had three problem tenants. If you get the right ones, it gels and everyone gets on.
"It's great when it happens. We converted two adjoining semis into HMOs and the tenants in each get on so well that they had a joint Christmas party and even cook each other roast dinners. Recently they were all out on their decking for a barbecue. They were having such a good time I felt quite envious!"
