In this episode of Deal Finder’s Corner, Mark Shaw’s calm and methodical delivery, packed with practical insights, educates, and will inspire investors at all levels. Highlighting the importance of understanding estate agents’ challenges and offering solutions, creative financing for low money down deals, Shaw details how to create a pipeline of consistent deal flow. 

The episode provides Shaw’s blueprint for property investment success, and proves that achieving financial freedom through savvy property strategies is attainable.

Guillaume Black, CEO of Property Filter , enthusiastically introduced Mark Shaw, lauding his remarkable feat of 50 property deals last year while working a mere two hours a day from his laptop, and using minimal personal funds. Shaw’s extensive experience in the property sector since 1988 includes owning estate and letting agencies, managing a diverse portfolio of over 80 properties, ranging from residential to commercial spaces, HMOs, land, blocks of flats, and even a hotel.

Now retired and enjoying financial freedom, Shaw is not only a master of goal setting but also leads an active lifestyle. His commitment to “Get Up, Give Back” led him to walk 100,000 steps for charity, and reduce his body fat percentage to 5%. Guillaume, particularly impressed with Mark Shaw’s unique talent for cracking nuts with certain body parts, hoped Shaw would expand on this later. This didn’t happen as the session was entirely immersive and compelling, focused on insights and teachings of Shaw’s methodologies. 

What is a Lifestyle Investor?

Mark Shaw is a lifestyle investor focusing on low-capital strategies like lease options and delayed completions. Valuing efficiency, he uses email for communication and prefers private finance or taking over mortgages instead of traditional loans. This method allows him to quickly scale his portfolio, leveraging relationships with agents for optimal deals. Distinct from traditional property investing, Shaw aims to grow his portfolio remotely, enhancing returns with minimal personal effort.

The Benefits of Investing in Property from your Laptop

Investing from your laptop offers flexibility, allowing you to explore possibilities without leaving your home. Mark Shaw, a self-confessed introvert, says, “it’s about as remote as you can get… I don’t go to properties.” This approach not only saves time but also significantly broadens the scope of potential investments. Interestingly, despite property being a people-oriented business, it’s possible to build relationships and negotiate deals without leaving your desk, no matter where you’re remotely working from.

“I invest as a lifestyle investor, and I value my time and resources more than anything else.” (Source: Dall-E) 

What are Low Down Money Deals?

According to Mark Shaw, a low money down deal is an investment strategy that necessitates minimal personal capital. He advises, “Your main focus should really be on low money down deals…if this resonates with you, you’ll find this discussion enlightening, as this is precisely my approach to investing.”

What are Assisted Sales and Lease Options?

Lease Option

Assisted sales and lease options are potent, low-money-down strategies in the property investor’s toolkit. Mark Shaw explains that an assisted sale involves agreeing on a price, refurbishing the property, and selling it without actually buying yourself. He describes a lease option as “a contract which gives you the right, but not the obligation, to buy a property during the ‘option period’.” These methods allow for controlling a property for a set period with the option to buy, without initial ownership, aligning with an email-based approach for added flexibility and reduced risk. Shaw emphasises understanding the vendor’s situation is key. He dispels the myth that lease options target those in financial distress, stating, “I’ve never done a lease option with someone in financial trouble…these are simply solutions they hadn’t considered.”

Lease Option vs. Delayed Completion

A critical piece of advice from Shaw in the Deal Finder’s Corner is on terminology. When communicating with agents and vendors, he suggests avoiding the term “lease option,” as it can deter vendors if they consult the internet or professionals not familiar with such arrangements. Instead, “delayed completion” is preferred, a term more universally understood and less likely to alarm potential partners. Shaw recommends avoiding legal jargon during these discussions for smoother negotiations.

The Importance of Building Relationships with and Educating Estate Agents

A key to remote investing success lies in the relationships built with estate agents. Understanding their needs and educating them on how you can solve their problems is crucial. As noted, “Understanding the nuances of estate agents’ operations… is key.” Effective communication and demonstrating your ability to close deals swiftly will make you a preferred buyer among agents. Complete transactions within a shorter timeframe (4-6 weeks) to incentivise agents and vendors to work with you.

A powerful teacher, Mark role plays dialogues between investors and agents, and demonstrates how it is vital to know how the agents position might play out with a property, “I understand why you’ve put it on at that price because if you didn’t they would have gone with a competitor.” He goes through the timeline and likely eventuality for the agent, “now you know that this property is not going to sell at that price and over the next 12 to 13 weeks the feedback you’re going to get is it needs too much work or you’re going to get offers that are too low and that’s going to upset your vendor so at some point in the next 13 weeks you’re going to lose this property to a competitor…. but I’m in a position where I can offer your vendor close to the asking price a price.”

At this juncture, Mark Shaw will explain the potential avenues, for example lease options, and as a result, the “agent sends it on to the vendor but this time he’s promoting you now because he understands how it’s going to work but more importantly, he’s now got a way that he can get the price that his client’s happy with.”

The Powerful Benefits of Email Communication

Building on the concept of delayed completion, Mark Shaw explains, “at this point this early point they’re assuming that it’s a delay of perhaps a week but when we take it to email and we’re talking about the advantages of what we’re offering then they it starts to make sense that the delayed completions longer but they understand the benefits and why it’s appealing to them.”

Through case studies, Mark Shaw highlights the simple, yet nuanced, benefits of negotiation, explanation, and relationship/trust building that are uniquely achievable via email, as opposed to in-person visits or phone calls. He notes the softer energy of email communication, which fosters greater clarity and better outcomes for all parties involved: “we communicate only by email because most email communication happens in the evenings when the vendors can sit at home discussing your email and sending you the questions.”

Raising Private Finance: Building Your Network of Private Investors

Securing private finance is essential for scaling your portfolio. By offering fixed-rate returns to private investors, you can tap into a vast resource pool. Building trust through referrals and showcasing a successful track record encourages more investors to contribute, creating a sustainable funding stream. In the Deal Finder’s Corner, Mark delves into the psychology of investors and the tiered approach to building trust. He outlines the proven blueprint and benefits of developing relationships with multiple ‘smaller’ investors, emphasising the flexibility this strategy offers and its snowball effect. Mark shares how, in a short space of time, he raised over a million with investors starting with £5k.

Conclusion

For much more learning, for example, in negotiations, one of Shaw’s number one rules is, “never be the one to first mention a figure; the first one to mention a figure loses.” For a deep dive and comprehensive education into Shaw’s blueprint for success, along with case studies, we at Property Filter recommend making yourself a cup of tea and watching this episode. The Q&A with investors, deal sourcers’, and newcomers to property is an informative session in itself!

Dive deeper into property investing negotiation tips by reading our blog articles: Deal Finder’s Corner Episode 05 featuring Saj Hussain and Episode 18 of DFC starring Robert McPhun. To explore the Lease Option further, you can also check out Episode 15 with Barry White and Episode 16 with Shimon Rudich.