Listen to this episode below:
Today I am delighted to be joined by Mike Howman. Mike is business partner to Shaun Callacher, one of our very early guests from episode 14 and some of you may even remember that Mike joined us on a webinar a couple of years ago talking about lease options, one of his areas of expertise.
He’s had a hugely successful property career over the past 6 years, entering the industry after losing his previous business during the recession. Despite the financial and emotional strain that put on him and his family, he learnt some big lessons from the experience and started his property journey by surrounding himself with a great team, creating systems very early in his property business, and staying extremely focussed whilst the business was growing.
He’s now got two great property businesses that he’s extremely proud of. Mantra Homes which is building new homes across the north west with a project pipeline worth £50 million, and prosper by property which is his education platform for training and mentoring property investors.
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Mike spent the early years of his property career growing an impressive lease option portfolio of around 150 HMO rooms with his business partners across Liverpool. Despite that success, due to changes in the market and changes in what they want to focus their time on, over the course of the next few years they plan to hand back most, if not all, of these rooms.
They provide a great income, however this is gradually being eroded by market forces (predominantly increased competition). The profit they’ve generated from this portfolio over previous years has allowed them to venture into their real passion of property development, building a portfolio of rental properties across the North West.
Mike’s team are currently in the process of building 5 townhouses in Manchester with a GDV of £1.2 million. This will deliver at least a 25% profit margin on their costs – the minimum they aim for on a new development.
They originally hoped to complete the whole project in 12 months, which is now looking more like 15, but with an goal of having 5 projects like this running at any one time, it’s a small delay and a massively lucrative strategy.
On their first two development projects, they had all of the funds lined up then Brexit hit the news and it disappeared overnight.
It just goes to show that there are so many external factors beyond our control that we also need to try and factor into our plans. Having a plan B and plan C in place for all aspects of your projects makes a lot of sense, so when these unforeseen events crop up it doesn’t cripple your progress.
What’s Your Favourite Book?
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The Obstacle is the Way – Ryan Holiday
How Not to Die – Michael Greger
Mike Howman’s Links & Resources
Basecamp – The project management software used by Mike and his team to keep track of all elements of the business
Mike’s Prosper by Property Website – Plenty of videos, articles and case studies covering all areas of property investment
Email Mike Howman – Got a question or looking for some advice? Get in touch with him here.