Looking for BMV properties in the UK?
Having built a £2M portfolio consisting almost entirely of BMV property myself, I've learned a thing or three about this...
In this post, we'll look at how you can find BMV property yourself.
AND how we can help you by finding properties for you...
But first, let's make sure we're on the same page as to what BMV actually is.
BMV stands for "below market value".
This just means that the seller has agreed to sell the property for less than they might fairly expect to receive on the open market (often in the region of 10%-30% less).
The main question on people's lips when they hear that is: "why the heck would they do that?!".
But we have to realise that while getting the highest price for our home may be your goal, or my goal when selling...
It is not the goal of everyone.
Specifically, it is not the goal of motivated sellers.
Instead, motivated sellers value other things like:
These things are much more valuable to a motivated seller, and if they're genuinely motivated, then they'll trade a bit of a discount on price for one or more of the attributes above.
Someone might become a motivated seller, and need to sell fast, for any one of a number of reasons:
In these situations, someone will often feel pressured to sell, and price quickly becomes less and less important as their problem gets worse, or a deadline looms closer.
It's important to note that time is the factor that makes someone more motivated: they normally become more motivated as time passes.
Let's face it, most of us simply don't have the time to go out and find BMV properties ourselves.
It's not as simple as just walking into your local estate agent office, and saying "tell me about your BMV properties".
Number one, you'll likely get laughed straight out of the door.
But secondly, BMV deals don't just fall out of the sky...
No, they are usually born of negotiation over a period of time.
And that negotiation is usually easier when you are face to face with a seller, or at very least on the phone with them.
For that reason, to me, the best way is to cut estate agents out of the equation altogether.
My favourite way to do that is with low to no-cost guerrilla marketing.
There's no doubt that it takes a lot of dedication, a steep learning curve, and time to source BMV properties yourself.
So, if that's not something you're prepared to do, there are specialists out there who source BMV property for customers like yourself.
Like any industry, there are certainly cowboys out there, so try to go on referral to make sure you're dealing with a legit company.
We've worked with a couple of sourcing partners for years and have dozens of happy customers as a result.If you want to see what they have in store just now, the best thing to do is sign up for our property deals alerts service, and any new deals will hit your inbox as soon as they become available.
To give you a taste for the kind of thing that comes up, here's a deal that's available currently, as I write this, with one of our sourcing partners:
Leeds, LS12 -- 2 Bedroom apartment
Market value: £100,000
Purchase Price: £68,000
Gross Income: £6,900
Here's another, larger, deal.
This is actually a BMV portfolio of properties:
NEWCASTLE UPON TYNE -- PORTFOLIO OF 13 PROPERTIES
Portfolio Est. Market Value: £854,000
Portfolio Purchase Price: £725,900
Mixed Portfolio: Houses & Flats
Annual Rent: £74,640
Est. Interest Only Mortgage: £13,611
Est. Gross Annual Profit: £61,029
Ave. Yield: 10%
As I mentioned above, my favourite way to do this is to go direct to motivated sellers.
There are a number of ways to do that, and I cover a few ways in this post here.
Once the leads start coming in, of course not all of them will be truly motivated, so your next job is to weed out those who aren't.
I've found the best way to do that is to ask questions like, "how long have you been on the market?" or "how quickly do you need this away?".
The seller's answers to this type of question is normally extremely revealing, and allow you to get a good feel for their motivation level.
It is very important that you only deal with motivated sellers though, so if your questioning reveals someone who doesn't really need to sell, then move on quickly.
Remember, time increases motivation, so don't forget to set a reminder to check up on unmotivated sellers regularly -- perhaps monthly? -- to see if they're motivation has changed.
When dealing with motivated sellers, it's important to remain sensitive to their situation, and be gentle in your questioning.
Sometimes, arriving at a price is as easy as asking how much they want for it.
Sometimes you don't even have to ask: I once snagged a 30%+ BMV property when the seller just came straight out and told me what she wanted.
She had just split with her husband, and wanted shot of the house quickly, and didn't want the neighbours to know.
Other times, you will want to ask how much is outstanding on their mortgage (always ask permission before asking this type of sensitive question), to see if there's enough room for the kind of discount you're looking for.
Then, once you've gathered all the info you need, go away and do your research to value the property, and work out how much you want to offer.
We have a property due diligence / valuation form that you can use to guide your research available free when you sign up to our newsletter.
If that's whet your appetite for sourcing BMV properties yourself, then I recommend my Guerrilla Property Marketing course.
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