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Dentists Who Invest

Secrets To Success In Property with Sath Vaddaram

Full Transcript

James: 

All right, thank you. Thank you, what is up everybody? Welcome back to the Dennis who invest podcast. We haven’t done a property podcast in way too long, so we’ve got to do something about that. And, on that very note, that’s why I’m extra privileged to have my friend Seth sat here in front of me, who is a whiz whenever it comes to everything properly, because dentists really do love their property. I think we can all attest to that. Seth, how are you today?

Sath: 

I’m fine.

James: 

James, how are you? I’m flipping amazing mate 11 out of 10. Over here Busy busy, busy, busy, busy, busy, busy, but productive. If you’re busy doing low leverage on important things, that’s a different kind of energy. But if you’re busy doing fun things and being productive, that feels good, right. I’m sure we can all agree.

Sath: 

Exactly, I’ve been doing the exactly same thing, yeah.

James: 

Vinderbar. Okay, seth, so I know that we know each other. However, the Dennis who invests audience is the first time that you are appearing in front of them, shall we say, so it would be lovely if we could have a little bit of a bio about yourself and your background.

Sath: 

Yeah, Thank you James. Yes, I know. Yeah. As you can see from my accent, I’m not from here. I came from India in 2001. So there may be a slight difficulty understanding my accent.

James: 

for that reason, we’ll be all dead.

Sath: 

Yeah, a lot better than 23 years ago.

James: 

Listen, listen. The people who listen to this podcast can understand what I’m saying through this thick Northern Irish I don’t know what you call it kind of mongrel tongue that I speak, Seth, so I think you’re going to be good, my friend. Yeah, thank you, I think you’re going to be good.

Sath: 

Yes, I came to this country in 2001 with only 500 pounds in my pocket. So when I came here with a video therapy degree, I was thinking of joining the NHS and proceeding my career in that line, and I did work in the healthcare industry for about six months to nine months, and then I realized that my heart wasn’t there. My strength was slightly different, my skills were different, although studied professionally physiotherapy, but my heart wasn’t there within that field. Then I was trying to explore what else I could do. So then I have tried many things by exploring some of the businesses, such as petrol stations or in the shops, like that, and then later on I decided to study before I do anything, because I’m very much believe in the education system. Until we know things, we can’t do it properly. So I know some people jump and go and do it and burn their hands, but I’m not a that type of person where I take huge risks and ruin my life. So rather than doing that way, I decided myself to educate first and then do things. Hence I just chose to join the University of Lincoln in 2003 to do the Master in Business Administration.

Sath: 

I joined here while I was studying and I managed to find some print circle and then I thought, rather than paying the rent, I just thought to buy a property. So that means I can live there for free in a way, because I have friends who could also would like to join at the time. That is the idea behind it. I was thinking of just having a house, live for free and then finish my degree and go back to maybe working for some other company. I went to the bank and asked for the mortgage, which is normal for anybody to do it when they think about buying property and then bank said no, I won’t get the mortgage because I didn’t have a proper status within this country. I was on a visa which would expire after one or two years, so they didn’t allow me to have a mortgage. Then I didn’t give up my idea of buying property, so I decided to apply for the credit cards. I know it is not a right way of doing things, but I did it. Wow, I applied for credit cards.

James: 

What a story.

Sath: 

Yeah, I was through the various banks and managed to get nearly 10 credit cards, or 10 to 12, I believe. Accumulation of the credit limit was nearly 90,000 pounds. Oh my, I took all the money from the credit cards on a 2% interest rate for 12 months, 18 months, 24 months, like that, so that time it was easy to get those type of offers. And then I managed to get all the money and paid cashed by the first property for 80 to 2000 pounds Totally. What a story, yeah. And then I went back to bank after a few months saying that you refused to give the mortgage, but now I already have the property. Like that, lend the money on this same property which I already own. Okay, yeah, that time their stance were so different. Yeah, they said, yes, let us look into the application. And then they valued the property and they’re trying to lend the money on the same property I own.

Sath: 

Then they lend the money. They said, okay, we valued the property for 105,000 pounds and then we would like to lend you nearly 90,000 pounds. I said, yes, come on, get it. Okay, I got 90,000 pounds back. I can’t. I cleared all the credit cards. I still left with 10,000 pounds. That is the light bulb movement.

James: 

Oh, no way, this is crazy, it is.

Sath: 

It is totally crazy. Okay, I bought the property for free. I’m living there for free. I’m getting the rent from my friends who was with me at the time. There are nearly four people living with me. They are paying the money as a rent, which I was making more than 1,000 pounds a month net profit. I got another 10,000 pounds in my bank account by having a property, which is really crazy thing to think. I decided, oh, this is it, this is what I want to do. Then I bought the second, one, third one, fourth one and never looked back.

Sath: 

Now I have got more than 100 properties using exactly the same formula which I have invented or maybe got to know in 2003 because that could have been used by other people before or even now I found that formula. I have been using that for 21 years now, which is working perfectly well for me. That is a bit of myself. And as I grew and when I reached 20 properties, I opened the plating agent. Then, when I grew even bigger, and then I opened my building company, which provides the architectural services planning, building control services. Then I opened the hotels as well. Recently it remains five years ago I have got mixed portfolio consists of rooms, which is also known as HMOs, single-let commercial properties, shops, hotels, warehouses. Yeah, I have a wide range of properties that means I can able to diversify my income in a various aspect. So, yeah, it’s all working for me.

James: 

That’s quite the story, saf. That’s amazing man, and listen, hats off that. There’s a system that you’ve created. And then, just for the sake of the audience I know that we talked the other day You’ve got a company right and you’ve got 60 people in the company, don’t you?

Sath: 

Correct.

Sath: 

Yeah, so, like I said, I have created a lot of brands within my companies. The first one is Properties on the Market. Although it may look like a national company, if anybody see my office and even hearing that brand name Properties on the Market it stands out. But it’s my own business, which I created from scratch. So that is, we only have one office in the K. But saying that, that brand itself looks like a national brand which would open up to another city and we can expand further. But I am the only one in my business. I don’t have any other partner, so I have limited resources. So I couldn’t be able to expand to other cities, although I could.

Sath: 

The second brand I created is Buildrove B-U-I-L-D-R-O-W. Buildrove. It’s the same from Redrove and Building. Because we are builders, I just mix together. This is also I created myself. Again, it looks like a national brand, but we only have one office. The third one I created is Simply Stay. Simply Stay is like, as it is, simply staying in a hotel. So I created the whole model of self-serviced accommodation. So I usually buy bed and breakfast buildings. I converted into self-serviced accommodation or hotel by having more rooms within the same building, Because we are eliminating all the managers, cleaners, office and managers flat as well. Sometimes I get along with the actual BNBs. Every room is a money-making guest room. So because I created a whole system to sustain the whole model without somebody there physically present in the building, Nice, nice, awesome.

James: 

Will you finish then?

Sath: 

Yes, so, yeah. So all these brands which I told, which has got 60 employees so some of them are remote workers in India to save the cost down, so they look after all the telephone calls, handling and helping the guests. And we also offer 24 hours, 7 days a week, 365 days, including Christmas day. We pick the phone call if anybody thinks there we are.

James: 

Top stuff Awesome. Well, listen, I mean hats off. That’s certainly an awesome story for sure, and fair play to you for the success that you’ve had. And I’m just curious what we like to do on the podcast is we always like to give people little punchy, powerful things that they can use whenever it comes to their own investment. And if we were to hone that to your area of expertise, which is property, sath, what, in your opinion, could people be doing a lot better whenever it comes to property? What are the common mistakes that you see out there that you feel could be improved upon?

Sath: 

Yes, thank you, james. I have noticed by looking at my friend circle or somebody who is thinking of investing in property, the biggest mistake that most of them are doing is they wait for the property to come through and invest, which is a very wrong strategy. Instead, everyone should invest and then wait. Okay, because there is no good time or bad time in investing in property. So if there is no good time and bad time, why would we need to even wait even single second? Because I have seen biggest recession in the world, which is 2007 and 2008. I have sustained through that recession. By the time I had around 25 properties. Most of the people who were doing similar things were going bankrupt, but I didn’t. The reason is I was thinking differently. I converted all my portfolio or properties into the most. That means every room gives more money, so we can sustain. I managed to do that very quickly, so that means I can sustain through that recession.

Sath: 

It’s all about investing and then waiting. There’s then just waiting, waiting, waiting, waiting, without that realizing they lost several years in their life and it’s too late. That is the first advice I can give. Second one is most of the traditional investors. They save up for the deposits. So, for example, if they wanted to buy a 200,000 pounds property, they need about 50,000 pounds Start with, not even more. It depends on their credit. So if they need to wait for 50,000 pounds to be in the bank, it takes a lot of time. I have a strategy where we don’t need to, so they can invest money and then park for only few months and a year. Then they can get the money back.

Sath: 

Exactly same as what I did in my even first deal. I only parked that money. That again, that is not my money, it’s the bank’s money. Various banks who offered me the credit cards. I only parked for literally three to four months, that’s it. Then I paid back. But in return, what I? What did I gain? I got the property of free, without my money, and also they paid me 10,000 pounds more, which was in my bank account. Otherwise I never would have that money. Number three I had a stream of income, net income, every single month coming into my pocket from my tenants. So that is the beauty of the property. It can’t be done through any other investments, in my opinion.

James: 

Gotcha. Wow, okay, cool. Well listen, I think it’s probably important to mention that maybe the strategy isn’t going to be for everybody.

Sath: 

Right Saath, correct I think, although it sounds easy, sounds crazy, it is not something anybody can do. It requires a lot of detailed attention to buy the property. The whole concept starts from buying, or even before buying, property. So we need to be carefully choosing the property which sticks all the boxes and also which will give that money back after a few months down the line when we go the remote gauge process. So in order to do that it, we need to select right property and under right location and we need to know exactly what we need to be doing to improve the property. In other words, in order to enhance the property value, we need to follow certain strategies, which only comes with experience.

Sath: 

Somebody could ask. I didn’t have an experience when I bought the first property. How did you manage to get that out that time? It was. I’ve been lucky because every night that time in 2000, if anybody remembers those days in 2001 to 2007, every night every property was going up by 107 pounds. It was on the news. So I’ve been lucky. I was.

Sath: 

I bought the property in that time where the property price was going up through the roof, so it I got the money back because by the time I remote gauge and also I cleverly managed to get the price down because there was a distressed seller was selling the property at the time and due to the divorce, which is the personal reason, so I got it cheaper. And also, number two, price was going up every single night. Hence I managed to get it how. It is not happening anymore. So the prices price of the property are going up like it used to be, although it is slightly going up.

Sath: 

You so that we have to make sure we buy the correct property and write location. And also, other thing is not every location is suitable for implementing this strategy, purely because when we are trying to get the remockage, bank will assess the mortgage amount based on the rental yields. So, for example, if you buy a property in London where there is a, rental yields are lower comparing with the investment value of the property, so you can’t implement this strategy. Maybe bigger cities also will be in this situation where we can’t implement Link, and I can do it because by the property cheaper, the rents are so high when they are calculating the affordability to pay that remockage back, then it works out very well.

James: 

Yeah, of course. So it’s like all of these things, there’s a science to it, really isn’t there, yeah, and that’s where skills and knowledge come in, and certainly what we wouldn’t want everybody to rush off doing from this podcast is to try to implement what we’ve just talked about. We’re just pointing out some cool stuff that is possible, which can help people on their investment journey, but, of course, do you at DYOR do your own research everybody who’s listening and certainly it isn’t something that we want everybody to rush off doing. As we were just saying a second ago, what we’re really talking about today is education, knowledge, getting people to see maybe a different side to invest in that can enhance their ability to be successful effectively, but, like I say, it definitely won’t be for everybody. That is 100% certain.

Sath: 

Yeah, definitely. I highly recommend every investor, regardless of the amount of investment they would like to invest. They must get the independent financial advice and also they need to maybe get other expertise advice who are on. They may know in their circle, because there is always a risk to any investment, of course, but we are only here to help to invest their money into the property. I’m not a FBA regulated, so we will not touch the money directly, so we can only help to administer in the background, to implement the strategy on behalf of them. So what does that mean is whoever is willing to invest in property, they still own the property. They are the legal owners of the property, so we can only help from the behind scenes. If you know what I mean.

James: 

Yeah, of course, of course, man, all right, well, awesome. Well, saf, I’m sure that we could probably do quite a few podcasts on your knowledge on property and what have you. But I know you said you were a little bit pinched for time today. Have you got much more time?

Sath: 

Not really, I’m just into other meetings.

James: 

I don’t come much time.

Sath: 

Now I would love to talk about property. I can talk forever because I love property. That’s what I have been doing for the past 22 years, so I believe that I know most of the things within the property. So, purely because I tried so many different strategies within the property, such as buying traditional properties and also getting all the money out strategy, which is what we have just discussed so far, I also tried lease option strategies and rent to rent strategies, service accommodation, and I have got various aspects of income streams from the property itself. So I have tried many things. One of the joy of trying many things is I get to know the sides of those things. It doesn’t mean to say that I always been successful trying everything. I also lost money in few things which I tried, but at least I can able to guide other people to not do those.

Sath: 

Now that is the stage where I am in the actual thought of helping other people came from my own friend’s circle nearly 13 years ago, so I was buying quite a lot of properties, as I said, for 10 years, from 2003 to 2011. And then, when I was mingling with my friend’s circle, most of them are doctors and software engineers and some other business people as well, so they keep. They was keep saying okay, so you’re buying all the properties in Lincoln, there is nothing for us to buy. Okay, I thought myself okay, no, I’m not trying to be comfortable to you, there is plenty of properties you can also buy. Then they said no, I don’t know what to do. We are not really sure about buying and all that. And then I thought oh, if I’m just only buying myself, I may have X number of properties. End of the race. All numbers game. I may have X number of properties.

Sath: 

Let us say, after 20, 30, 40 years, we will be sitting in a care home. Okay, I will be sitting in a care home. Fortunately or unfortunately, that’s the life. And then they will be around with me, as they are my friends. They may say okay, you have got X number of properties, so why didn’t you help me to do this?

Sath: 

So that is the time I thought okay, I planted the seed in my brain. Okay, I’ve been doing this for a long time, so the formula I know how it works. Let us copy paste to other people. That’s all it is. So what I was offering for past 10 years is not something new to me. I’m only just copy pasting the strategy which I normally do or still doing to other people, whoever wants to do it, so that gives me a pleasure of helping other people. I already had a lot of appreciation from various investors because I built a portfolio for many people in Lincoln, outside Lincoln too. So they are saying that without you we wouldn’t have had all this portfolio and which is becoming like our pension part and I can happily retire even from very high end job which is giving nearly 200,000 pounds a per annum, especially from the doctors and consultants, so they can also retire from the portfolio which I have created for them. That is where I’m proud of helping other people to have a safety net pension for their retirement.

James: 

Respect my man. Well listen, thank you so much for your time today on the Dancing Invest Podcast staff and I’m sure we can look forward to welcoming you back very, very, very soon.

Sath: 

And of course I would say just to round off for everybody.

James: 

Like you know, all we are doing right here right now is just highlighting the potential opportunities. People out there are listening. We definitely don’t advocate this for absolutely everyone and, of course, with any investment, we just got to be super clear to say there’s always going to be risk afoot, you know. But what I really do try to do this podcast is give alternate perspectives from credible sources and people that I’ve met through, people that I know very well, who I know have a decent track record of doing well and yeah, like I said, to bring that information is an absolute pleasure to the Dancing Invest audience and I’m certainly looking forward to some more podcasts already Sath.

Sath: 

Anytime, james, I’m always available to talk about property. Whenever you’re available, feel free to call me, then we can arrange some podcasts if it is related to property.

James: 

Sounds good, my friend. All right, we’ll listen. Hope you have a smash the day and we’ll see each other really soon.

Sath: 

Thank you. Thank you, James P.