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Starting Out \u2013 The Building of a Property Empire<\/strong><\/p>\n\n\n\n In 1996 I bought my first rental property in Hartlepool, 4 Slater Street. A 2 up, 2 down house for under \u00a315K, spruced up a bit and rented out for around \u00a360 per week, normally to tenants on benefits. Once insurances, repairs and loan repayments were paid it provided me with a small amount of passive regular income.<\/p>\n\n\n\n I went on to buy further houses until 2000, building up a network of trades people to carry out the maintenance, with very few void periods the passive income continued and I loved the experience. With a tool box any man would be proud of I learned some canny skill sets in plumbing, electrics, boiler maintenance, counselling, benefits advising, social worker skills and neighbourhood mediator, to name a few of my many hats. <\/p>\n\n\n\n The Exit Strategy \u2013 always have one!<\/strong><\/p>\n\n\n\n I intended to sell the properties at the right time and use the capital growth to fund my retirement. Although I loved being a landlord it could be very tying, always being on call for emergencies and turning the houses round quickly after a change of tenancy to reduce void periods.<\/p>\n\n\n\n Blight and Fight – When it all went wrong\u2026\u2026<\/strong><\/p>\n\n\n\n Ending up with a property I couldn\u2019t sell, couldn\u2019t rent and left empty in blighted streets at risk of vandalism saw my dreams and plans quickly turn to that of devastation.<\/p>\n\n\n\n Property investors caught on and descended on areas like Hartlepool, with its cheap housing stock, willing buyers and sellers and no end of tenants wanting to rent. Owner occupiers sold up as areas started to decline with poorly run property management firms, out of town landlords with increasing crime and anti-social behavior saw communities starting to fail. Local authorities took action and re-generation programs were rolled out including demolishing streets through compulsory purchase powers to make way for new housing demands.<\/p>\n\n\n\n The Fight for Compensation Begins<\/strong><\/p>\n\n\n\n By 2002 plans were put in place to acquire properties by Compulsory Purchase. Streets were blighted as owner occupiers moved elsewhere with severance payments and alternative accommodation. For landlords the only redress was by difficult negotiating with authorities or failing that a lengthy legal process at a Lands Tribunal hearing. Little did I know that I was about to embark on my own \u201cErin Brockovich\u201d journey as I learned the ins and outs of \u201cCompulsory Purchase\u201d law.<\/p>\n\n\n\n 4 Slater Street \u2013 Blighted and awaiting its compulsory purchase fate.<\/strong> <\/p>\n\n\n\n A house I could no longer rent, couldn\u2019t sell on the open market and valued by the authority for peanuts with my only possible redress through a lengthy costly legal process.<\/p>\n\n\n\n Valuers and the legal beagles descended to regeneration areas with the promise of fighting to get us appropriate redress. However, when it was announced the Olympics were to be held in the UK in 2010, they disappeared as quick as they came, with much richer rewards to be had in the South and we were left to fend and fight our own battles.<\/p>\n\n\n\n They just took my property <\/strong>– no longer mine<\/strong><\/p>\n\n\n\n On February 28, 2007 I was made to hand the keys for 4 Slater Street to the council as they became the legal owner of my property through Compulsory Purchase powers. Very painful to say the least.<\/p>\n\n\n\n With 10% of the value of the property paid as compensation and a \u201csee you at the Lands Tribunal if you want to fight for any more?\u201d I stood in astonishment that I had just lost my property and it was perfectly legal.<\/p>\n\n\n\n Thankfully due to a failure of technicality by the council we entered into an civil alternative dispute resolution and I received my fair compensation and was saved the very daunting lands tribunal hearing.<\/p>\n\n\n\n September 2007 – Northern Rock runs out of money.<\/strong><\/p>\n\n\n\n As the credit crunch hit bringing about a failing property market with strict lending criteria, we saw the property boom of which most had enjoyed collapse overnight. Builders no longer wanted the land for new housing and plans were scrapped, leaving blighted streets in regeneration areas across the UK abandoned for many years.<\/p>\n\n\n\n Personally, I would put my experience up there with divorce and death. So much uncertainty, the stressful lengthy legal process, the loss of income and the time spent challenging the local authority. <\/p>\n\n\n\n My little property empire had failed in a way I would never have dreamed, and the affair with property that we had all come to enjoy also ended for most of the UK. It reiterates the old saying \u201cnever put all your eggs in one basket.\u201d<\/p>\n\n\n\n Risk warning \u2013 \u201cTax regulation and legislation can change in the future.\u201d<\/strong><\/p>\n\n\n\n As advisers we always warn clients of possible tax changes and I saw taper relief on capital gains abolished further losing out as new legislation was less favourable. Yes, property can be a great investment providing a potential source of passive income but there can be unforeseen perils and pitfalls as my story tells.<\/p>\n\n\n\n The risks of rental properties<\/strong><\/p>\n\n\n\n <\/p>\n\n\n\n Finally, you may end up in a lengthy legal battle and have to hand it over to someone else against your will!<\/strong><\/em><\/p>\n\n\n\n I hope my story gives you an insight into the highs and lows of property rental. Whilst it may seem easy money and others make it look a really successful investment, others who held property in the credit crunch may tell you different.<\/p>\n\n\n\n I finally get my day in court….only as a witness<\/strong>!<\/p>\n\n\n\n![\"\"](\"https:\/\/tracysimpsonifa.com\/wp-content\/uploads\/2020\/02\/Slater_Street-1024x591.png\")
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