Table of Contents
- Katie Orr posted a video on Instagram where she broke down a local property flip. It went viral.
- Orr saw she could monetize this demand and has negotiated 68 deals for property investors since April.
- Here she talks about her experience and offers tips to would-be dealmakers and property investors.
This as-told-to essay is based on a transcribed conversation with Katie Orr, the 23-year-old founder of KO Estates in Wilmslow, England. It has been edited for clarity and length.
I started looking for my first house in the spring of 2020 during the first national lockdown in England. I was working full-time in insurance but had so much spare time on my hands, I decided to document my journey on a blog.
In the beginning, I had no readers. I would publish one or two articles a week on social media. I had some background understanding of different properties from my parents’ own portfolios. The more interested I became in property, the more I posted, and my audience began to grow.
In early 2021, I posted a video breaking down the return on investment for a “fixer-upper,” which are called flips in the industry. This was a property in northwest England that was sold to an investor very cheaply. The investor then renovated the property and was able to sell it for a much higher price.
The video got 200,000 views on Instagram. I had lots of people messaging me saying, “Can you find me a deal like that!” and “I want one.” I realized I could monetize this demand and my own familiarity with the northwest property market.
I source deals for potential investors, mainly for buy-to-let properties, where yields are higher, which essentially means you will get a better return on your investment.
Since starting full-time in April 2021, I’ve had sales agreed on 68 properties. (Katie Orr’s lawyers verified to Insider that they’d started work on 68 sales of investment properties for her clients since that month.)
The number one thing I tell my clients is that investing in property isn’t a get-rich-quick scheme. If you want to start investing, you need to do your research.
Here are my tips for breaking into the industry and navigating your first investment.
There are loads of free online resources – find the reliable ones and use them
I wanted to find a really good deal when it came to my first property investment, so I started researching. I joined Facebook and
property groups where people talk really openly about their own investments. You can pick up a lot of knowledge that you wouldn’t have exposure to otherwise.
At first, I didn’t even interact with the posts or messages. I just used these networks to get a sense of the market and what deals people were doing.
If someone posted about a deal that was really successful I would reach out to them and try and learn more about their process.
I used LinkedIn to connect with architects and real estate agents in specific areas where I didn’t have as good an understanding of the market. Once you’ve built that network you can get access to properties before they hit the market.
There’s a lot of information out there, but you have to make sure you are learning from people who have actually done the deals and built their own portfolios.
Understand what you want to get out of your property
There are different types of properties to invest in that require varying amounts of time, money, and effort. You need to have a clear idea of what you can afford financially and physically, in terms of effort and travel.
The majority of my clients are from London and other parts of the south of England. They want to be able to have a very simple, reliable monthly income. They’ll usually invest in buy-to-lets with a single tenant who is already in the property.
In this setup, they can start receiving income immediately after the deal completes. However, this is a long-game investment. The returns on their initial investment will be incremental and it will take a while for a property like this to become profitable, but it’s passive monthly income.
A flip property is a lot more hands-on and expensive upfront but once you’ve sold, you see your return on investment and profit all at once.
HMOs are another option. HMO stands for “house in multiple occupation” where rooms in a house are rented out individually and the tenants share communal spaces.
If you are wanting to buy a property and convert to HMO you will be able to generate a higher cash flow, but there’s a lot more risk and more property requirements like fire exits. You have multiple tenants to manage and some areas are less receptive to these kinds of properties.
Figure out what your investing strategy is before you start buying.
The lowest barrier for entry in this property market, if you are going to use a mortgage, is around £20,000 ($26,636) plus a little bit more for legal fees.
In the UK, this is on the premise that most mortgage brokers will have a minimum lend of between £50,000 and £60,000. This means lots of people look for houses around £80,000. You need to have an upfront deposit of 25%.
If you don’t have those funds there are other ways to start investing.
You can partner and joint venture with people where you split the upfront cost and the income and jointly own the property. I’ve seen agreements where another investor has provided the entire initial investment while you provide the time and effort to execute a flip and pay them back their investment once it’s sold, keeping the profit for yourself to reinvest.
If you have the time and proximity to invest in a property that needs work, you can leverage any problems like damp, flooring issues, or even an old boiler to negotiate the selling price, which will bring down initial costs.
If you are looking into this route, make sure that the cost of the problem is reflected in the reduction of price.