This month our intrepid reporter goes in search of bargain training and gets confused by a field and a bunch of crooks.  He invents a way of launching vegetables using explosives, and meets someone who’s learned the hard way.  Then he gets a whirlwind tour of a range of property investments that actually work today – plus a warning on ways to ‘make money’ that don’t work at all.  Could this be the best-value course ever reviewed by PAN?  Read on and find out!

Boats, swimming pools, pretty girls.  They all look great.  They’re great for selling stuff, because there’s a huge aspirational value to them.  Who wouldn’t want a flashy boat – or at least be able to afford one?  I’m sure we all would.  As a result, if you’re wandering round a property show, the chances are you’ll see lots of pictures of stuff like this, stuff that you might like to have if you’re rich.  Sadly, what you won’t see is much credible information on how to get rich.  Many developers are a little reluctant to provide the figures that are the backbone of the investment.  Not so Platinum Property Partners.  The banner that advertises their course, and signposts the entry to their seminar room, has a picture of a nice house – but much more importantly it has cold, hard figures from the investment.  This is a firm that is actually focussed on delivering results, not pipedreams.  That approach shines through from the start.

Now wait a minute?  PPP?  Surely they are a bunch of utter rogues who hit the headlines for selling people houses that simply didn’t exist?  You’re absolutely right, dear reader.  But this lot are NOT that PPP.  They just share the same initials.  Personally, I might have chosen a different name!  Not only are these chaps not crooks (as far as I can tell, anyway!) but they are also more than happy to warn their punters about various crooked investment schemes on the market today.  Among these are the scandalously bad ‘off plan’ deals, which seek to shift property to gullible punters by falsifying generous ‘discounts’, which actually turn out to be nothing of the sort.  Idiot punters get duped into buying overpriced flats with crap yields that can actually fall in value, just like a new car.  I can say idiots with some confidence, because I was stupid enough to buy some of these ‘investments’ when I was young and foolish.

When you see Steve Bolton, one of the founders of PPP, there’s something about him that immediately conveys credibility.  It’s said that a company is a reflection of the personality of its leaders.  Steve’s character shines through in Platinum Property Partners.  He is a man who is articulate, well presented and credible.  But beyond that, he has three important characteristics which are lacking in many trainers and investors.  Firstly, he’s a philanthropist.  A section of the course is devoted to talking about the Ugandan orphanage project that the firm supports. PPP actually raised 2.5K on the day of the course from delegates, which the firm then matched, meaning that the course raised a total of 5 grand for charity.  PPP also sponsored my IronMan triathlon this summer, and this donation was by far the largest I received.  You might argue that this is irrelevant, but I do not see it this way.  Philanthropy is a significant indicator of integrity, in my view.  If you’re a greedy, selfish person, the chances are that you won’t give money to charity.  Do you want to do business with greedy, selfish people?  Secondly, Steve has a clear intellectual grasp of the systems he’s operating.  Surprisingly, this isn’t universal among successful property investors.  For many people, success is far more down to luck than judgement.  Trainers are often teaching a system that worked for them, but they often don’t have the intellectual rigour to work out the credibility of their own model.  They didn’t select it by careful analysis and they therefore cannot assess how market changes may affect the suitability of the system for the current market.  This is emphatically not the case with Steve’s approach.  He’s clearly got a very sound grasp of the reasons and principles behind the investment strategy he’s advocating.  Finally, and possibly most importantly, he’s learned from the school of hard knocks, having lost his home and business in his early thirties.  In the US, losing a business is sometimes known as losing your virginity.  Some firms exclusively recruit people who’ve run lost businesses.  Once someone has experienced the crushing terror of losing their own livelihood and other people’s too, it changes them for life.  They have a deep knowledge that you can’t learn from books or from mentors, and you can’t fake.  Only someone who has started into the abyss can know these lessons, and their whole investment approach and their viewpoint on life changes as a result.  There’s a clarity of thought and vision that logically follows on, and that’s reflected in the investment approach and training rigour.  I think that there are basically two types of people in the world: those you can rely on to give you covering fire, and those you can’t.  I’d place Steve in the first category.

So what are the strategies that are taught on this course?  There are several: overseas investing for capital growth, buying below market value for instant equity, self-build for construction profits and houses in multiple occupation (HMOs) for cashflow.  The latter is where the majority of focus is devoted.  This is an interesting approach.  I personally don’t feel it’s for me, but it’s a very good strategy.  Once you’ve gone through the financial pain of making the original investment, a properly managed HMO is thereafter a machine that makes you money every month.  It’s perfectly conceivable that you can extract over £1000 from such a property each and every month.  I’ve got tenants who manage to live a perfectly pleasant life on £1000 per month.  Even a more run-of –the-mill HMO should net you a good few hundred a month – several times more that you’ll get out of a single family let.  Of course, once you’ve got a money-machine like that in your portfolio, why wouldn’t you want more?  There are no sound financial or moral arguments against following this strategy, in my opinion, other than the requirement to invest cash at the start.  You’re providing cheap, environmentally sustainable housing, which reduces the need for new-build on greenfield sites.  That’s got to be a good thing in my opinion.  Due to the excellent cashflow, this is a style of investment which is very robust in the event of a market downturn or a recession.  You might make less money if times are tight, and you may struggle to sell off your portfolio if the market’s taken a drop – but month on month you’re very unlikely to end up losing money.  As someone who operates only single family lets, I’m currently very jealous of my high-yielding HMO investor colleagues!  As long as you are the kind of investor who can focus on fully optimising your portfolio, you stand to do very well out of this strategy.  The key to success is partly in negotiating good deals, but very largely around ‘running a tight ship’ on the lettings.  You need to make sure the properties are always kept nicely for the tenants, problems are fixed quickly, you advertise effectively to reduce voids and you operate tight credit control procedures.  PPP’s business model is about helping you to do this successfully.  Are you the kind of person that can deliver this standard of management?  Will you enjoy it?

Most of the PPP franchise partners seem to carry out most of their investments in HMOs, with other strategies being somewhat secondary.  This usually means leaving money in each deal, but it benefits from excellent ongoing cashflow.  Because you’re leaving money in each property, the rate at which the business can grow is limited.  Therefore, following the core HMO approach may not be the fastest or lowest investment way to make money from property.  For comparison, you can make money faster and with less investment using techniques such as options-based planning permission, but these are unlikely to deliver such consistent results and are also likely to require much more time and patience to get right.  As long as you can follow the rules of the game and run your business properly, you should be able to make HMOs work.

Beyond the bread-and-butter HMO approach, you will be introduced to self-build.  This is a strategy which combines excellent financial returns with a hugely satisfying project.  Who wouldn’t like to drive past a house and think ‘I built that’?  When done correctly, this approach offers the opportunity to make substantial profits on a reasonable investment in a very short period of time – frequently less than a year.  As a small investor, you can really use your personal contribution to great effect.  You will be able to undertake roles such as selecting the best plot (with or without planning).  You will also have the opportunity to boost profits by running the build programme correctly and bringing your design skills to bear on the project.  This strategy, at least at first, will be something that you’ll become very involved in personally.  I’ve never built a house from scratch, but the happiest days of my investment career were when I started out in refurbs.  Watching a building project unfold is hugely rewarding.

The course also covers below-market-value and creative finance techniques, and is taught by Steve’s business partner, Nick Carlisle.  BMV is the ancient voodoo magic of buying property for less than it’s worth, and using other people’s money to do so.  I shan’t dwell on the details too much here, as I’ve covered this approach several times in this column already.  Suffice to say, it’s about creating a win-win situation.  If you need a bargain property, you need to find someone who’s happy to sell at a bargain price to get the quick, reliable sale they need.  This could be someone who’s moving out of the area, splitting up with a partner, or who has hit hard times.  You can strike a deal that works for you both, and Nick will show you the ways you can raise the money you need, using bridging, or loan-to-value mortgages.  Of course, you don’t need PPP or Nick to show you how to do this, but when you can sit in the warm and get taught the strategy for peanuts, why wouldn’t you?

The partners at PPP, and many of their investors, choose to invest overseas at well as in the UK, and this is one of the strategies they teach.  To follow this approach, they seek to purchase property in counties and areas where significant capital growth can reasonably be expected.  This strategy only really works if you have cash to leave in the deals.  You need a large portfolio before you can extract enough money to keep buying overseas on a regular basis. However, if your properties are chosen wisely, you should expect a very high return on investment, as long as you’re patient enough to wait for the growth to occur.  This strategy suits the armchair investor, who can invest money from UK equity or from earned income with the intention of providing for longer-term financial goals.  Don’t try to eat your profits!  PPP take deals from Property Secrets, a firm which has a track record of selecting high capital-growth investments around Europe.  Not all of the Property Secrets deals have done massively well, but on average they have a very good track record.  Personally, I think there are risks in this business model now, as there is a medium to high chance in my view of a general economic slowdown, which could impact on the property markets of Eastern Europe.  However, if you choose your market and development carefully, I think there are still good returns to be made, provided you are conservative with your figures and keep a variety of exit routes open for your investment.  PPP seeks to promote only a selection of Property Secrets deals, and I think that this double-filtering process is likely to lead to some very fine investments.  However, do your own research and hold your own opinions about a deal.  My personal advice is to make sure you concentrate on affordable units with good rental potential.  You should invest in areas where there is a limited supply of new build despite strong projected capital growth.  You should make sure that the units are affordable to the local population, and appeal to a wide variety of potential buyers.  That way, you will be best insulated from any price falls should a recession bite.

It’s important to understand how this firm is operating.  Unlike a lot of other seminars, this course is the start of what the organisers hope will be a long business relationship with their clients.  During the day, they introduce many people who are on their franchise or mentorship scheme.  There are two ways of looking at this.  You could argue that these people serve as a demonstration of success and a guiding light to those people who need to appreciate that they too can be successful.  The alternative point of view is that it’s a low-cost course subsidised by a big sales pitch for their more advanced products and schemes.  Each of these points of view is of course correct, and how the balance lies between the two is entirely down to your perception.  There’s nothing inherently wrong with the PPP approach, provided you go into it with your eyes open.  They specifically aim at people who are relatively affluent, but who want to maximise their investment effectiveness and get consistent returns without doing anything too rash or radical.  Their recommended starting capital is in the range of £50-300K.  This doesn’t mean that you can’t apply what you’re going to learn to a business model with lower start up costs, but you need to be aware that the structure of the investment advice given is based around investing from a position of some financial strength.  If you try and start this business with ten grand swiped from a credit card, you’ll be taking bigger risks than they’re intending.  However, the first training graduate that spoke did in fact start his business using an investment on this scale, so it is possible.  In general, though, you should expect to have to invest cash in the deals you’re buying.

It’s important to recognise their style of teaching and how it may interact with your personality.  The approach of PPP is a lot more disciplined than many of the alternatives.  Their training is about imparting not only the principles, but also a level of nuts-and-bolts detail that isn’t commonly found on competitors’ courses.  It’s a style of learning that works well for people who want to be shown what to do, and who then flourish by following the systems and procedures they’ve been shown.  This isn’t about encouraging your creative flair, it’s about giving you the tools and techniques needed to execute a strategy that works.  Personally, I think I’d find this approach stifling, but if you’re the kind of person that thrives on operating a system that’s been designed for you, then this could be exactly what you’re looking for.  You don’t need to be innovative, you just need to do what you’re shown.

During the day, you’ll have the opportunity to see some of the franchisees.  They’ll give you the raw version of their story.  They don’t all do it in exactly the way that PPP recommend, and they have obviously made mistakes along the way.  This is a hugely inspirational process for many people, because there can be a real mental block on seeing yourself doing the things that course trainers do.  After all, trainers are God-like beings who can walk on water, aren’t they?  Whilst this is clearly nonsense, a lot of course delegates do seem to feel this way.  The opportunity to see the franchise partners face to face, with all their human frailties and failings in plain sight, should show even the most hardened naysayer that they really CAN make a property business work.  So if you think you’re too fat/tall/shy/stupid/foreign/black to make a property business successful, then come and let the PPP franchisees drag you out of that little bubble you’ve created for yourself.  The lies you tell yourself are just a way you’ve found to stop you having to do anything ‘scary’.  As long as you feel you’ve got an excuse, it’s comfortable being unsuccessful, isn’t it?

So what do I think of the course?  It’s unusual in many ways.  I’d like to walk you through these differences so you can get an idea of whether it’s likely to be right for you.  Firstly, it’s a lot bigger and more ‘commercial’ than other courses.  The course and the franchise scheme that follows naturally on are big business.  The next key difference is in the business model that the trainers operate.  They run a bona-fide franchise operation, under the regulation of the British Franchise Association.  This gives investors the chance to join a ‘proper’ system that’s independently accredited.  If you want credibility, rigour and hand-holding that goes with this, then you’ve come to the right place – but don’t expect them not to introduce it to you during the day.  Thirdly, the range and rigour of the business systems on offer is superior in many cases to that offered by other courses.  Whether you follow the franchise route or not, you’ve still got the benefit of business models that are soundly based on today’s market.  Finally, the level that the course is pitched at is significantly lower than many comparable courses.  You won’t be expected to have great background knowledge to make the most of it, and the organisers spend a lot of time going through the basics of investment to make sure that you don’t end up making beginners mistakes.  Overall, I’d suggest this course is best suited to investors with a fair bit of cash but who lack the knowledge or direction to be clear about their property business approach.

The training is held in the DeVere hotel near Reading.  This is about 3 miles from the motorway, and is on the opposite side to Reading, so expect a long taxi/bike ride if you’re getting a train.  It isn’t signposted as DeVere from the motorway, and as it’s a new venue it might not be on your satnav –mine thought it was a field, which left me driving around in a confused fashion for quite a while.  Make sure you study the map carefully otherwise you’ll get lost, drive up stupid country lanes and swear a lot at bumpkins and tractors.  The training room I was in wasn’t the one they usually use, and there were no tables.  However, I’m assured that there are much better facilities normally.

One of the really big plus points about this course is the catering.  Not only did PPP provide lunch, but there was also a full evening’s entertainment laid on, with a Christmas dinner and a disco, complete with silly party games and suchlike.  The evening meal costs extra for delegates, but at £25-50 depending on the day, it’s at a comparable price to many evening networking events, but with a meal thrown in.  At the dinner I went to, each of the place settings had a party popper, and these were the best I’d ever seen.  Instead of the normal plastic body, these were made of shiny cardboard, and the business end was slightly indented rather than flat.  This indentation was almost exactly the same size as a sprout, and with a bit of care you could turn the party popper into sprout mortar.  As a respectable journalist I could never of course resort to such unruly behaviour, but my dinner colleagues were not so restrained and soon they were merrily shelling the other tables with vegetables.  I haven’t seen such jolly japes since drunken 6th-form balls – fantastic!

I’ve never seen anything like this quality of catering and entertainment before on a training course, and it certainly enhances the experience.  It gives a lot of opportunity to get to know the founders, employees and fellow investors.  During the meal, I really got to grips with the concept behind PPP.  If it was a car it would be a VW, and if it were a food shop it would be M&S.  This isn’t a bargain basement training outfit, it’s a firm that pitches its service at people who have money and want to get good quality.  They want quality business strategies, and they want the service that goes with it.  Sure, you can do these strategies on your own based on the course, but if you’ve got the cash to put in and you’re lacking the expertise, then there’s a strong argument for the hand-holding that PPP offers.  Regardless of whether you’re interested in the further support and franchising, it’s very hard to argue against going on the course as it teaches very sensible strategies and only costs £147.  It’s just about the cheapest training course I’ve ever been on.  That’s the price of a cheap bicycle or a nice coat, and neither of those will make you any money.

In conclusion, therefore, this course offers an excellent opportunity for investors, particularly new investors with cash or equity.  The teaching combines rigorously thought-through approaches with a diversity of models that offers choice in investment styles.  The business models taught are very solid and sensible, and avoid much of the hype and nonsense that gets talked in some corners of the industry.  However, the PPP approach is based around selling a longer term programme of support for investors.  I don’t think that’s a bad thing, and it’s not a pressured sales approach, but you are entering the start of a process.  You can walk away, take the knowledge and go it alone, but be aware that that is not the intention of the organisers.  I haven’t been able to review the franchise or mentoring programme at the time of writing, so I am unable to offer comment on whether they are professionally delivered or represent good value for money.  However, based on the contents of this course, I can say with some confidence that the whole approach of PPP is soundly grounded in the fundamentals of today’s market.  In my view, for an investor with a bit of capital, the PPP approach is likely to be one of the safer ways to invest and still get dependable and attractive returns.

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