From £37 to 12 Houses | Scotland Property Tycoon, Giuseppe Paladini
When Giuseppe Paladini started out in property, he had just £37 in the bank. So, he released the equity on his home to put a deposit on a buy-to-let. Now the father-of-two has a portfolio of 12 houses and apartments in Scotland which have given him the financial freedom to pursue his life goals – including travelling back to Italy to see his family whenever he wants. Attending the Property Investors Crash Course was the catalyst for his success.
‘I googled how to get rich’
In 2008, Giuseppe came to the UK, where he completed his PhD, adding the title of ‘Dr’ to his name. He then became a university lecturer in public health in the city of Stirling in Scotland.
It was a well-paid job but with a family to support, the salary was insufficient for his responsibilities and needs.
As he explains: “I went through the pain of not getting enough salary at the end of the month and too much of the month left before the next pay day. So, I had to do something. That’s when I googled how to get rich and property came up.
“I thought property is a game for rich people, only because I come from a very humble background. But then I thought let’s give it a try.”
Giuseppe started by watching YouTube videos and read books about making money from bricks and mortar. With that information, he then bought his first investment property.
He only had £37 left in his bank account at the end of the month, but he owned a house and realised the equity could be released.
“I learnt a new language when I started to study property, like equity release. I realised there is a difference between the value of the house and the outstanding mortgage, so that little bit you can pull out tax free.”
Giuseppe discovered that he had £27,000 of equity, and so he pulled it out to purchase a buy-to-let in December 2017. It was performing well, but then he learnt about the serviced accommodation strategy and turned it into a furnished property for short-term lets. It made him more money that way and enabled him to put down the deposit on an apartment. That one too is rented out for short stays.
Slowly, his portfolio has grown. It includes eleven properties, which he owns, and one rent-to-rent, all in Scotland, where he still lives.
‘If it worked or not was up to me’
As someone who is also a mindset coach, Giuseppe recognises that being successful in property is as much about the person as the technical skills. Having an upbeat personality and positive, can-do attitude helped Giuseppe to achieve his aims.
“If you don’t do it, you don’t change anything you’re unhappy about. The only way to go is forward. That’s what I did. I knew what other people were doing, so it was up to me if I wanted to make it work or not.”
Watching Samuel Leeds’ YouTube videos inspired him to come along to one of the company’s free, two-day crash courses in Manchester in 2018. At the time the only knowledge he had about property was from studying books and watching videos.
The energy in the room and the knowledge which Samuel shared with his audience during the course spurred Giuseppe on. During the lunchtime break he took the opportunity to ask Samuel a question about HMOs.
“I said: ‘Where I live, they are saturated with HMOs and the council is not giving any more licences. What do I do?’ Samuel replied: ‘Move to another city.’ I thought that sounds so simple.
“Sometimes we perceive problems as problems when in actual fact there is a solution for every problem.”
Rather than finding problems, Giuseppe has tapped into the advantages Scotland offers for investors like him.
The stamp duty of three per cent in England and Wales is one per cent lower than north of the border, so property might seem more expensive, he points out. However, once you make an offer and it has been verbally accepted, you cannot be ‘gazumped,’ as in England.
The disadvantage is that you have to buy the property, which could put some people off making an offer. Nevertheless, there are other benefits for entrepreneurs like him. In Scotland all flats are freehold which means you own the land on which each one is built. In England they are leasehold.
You cannot enter into a lease option agreement in Scotland, but an exchange with delayed completion is possible. It works on a similar principle, with the key difference that you are obliged to buy the property when the term of the agreement ends. Giuseppe managed to secure one for a client he sourced a property for.
As well as operating two serviced accommodation apartments, he also has tenant buyers in some of his houses.
“I love this strategy. Rent-to-buy gives no hassle whatsoever for the landlord. During lockdown you couldn’t evict tenants if they were not paying. That doesn’t happen in rent-to- buy because the tenant has a different mentality.
“They know they are setting up a property that is going to be their own at the end of the term of the agreement you have with them. This could be in five, seven or 10 years. You agree the time and the purchase price at the beginning. Then they are responsible for repairs and maintenance. If they want to change the kitchen or garden, they can do it because it’s their house.
“So, they’re paying you the rent but also a top-up. It’s a build-up of the 10 per cent of their deposit at the end of the term for the mortgage. You can’t touch the top-up. It’s in a client account but if they default on the rent, you can get it. If they damage the property, they lose it.”
Serviced accommodation is more profitable
Serviced accommodation was an obvious strategy to adopt, says Giuseppe, because it is much more profitable than having a buy-to-let.
“With a buy-to-let you have a long-term tenant normally, but with serviced accommodation it is a short-term let. You rent a house or an apartment out per night. Say, for example, that you can get £500 for a buy-to-let per month. With serviced accommodation you can get that in four or five days. It’s a no brainer but it’s a lot more hands on, so you need to build systems for you to be completely hands off.
He adds: “Sites like booking.com and Airbnb, which are online travel agencies, offer a bookings service. You have to pay a percentage to the agencies but it’s a necessary evil because they give you a wider audience and a better clientele.”
Each of his 10 buy-to-lets are making him a profit of £400 to £500 a month, while his serviced accommodation business nets two or three times that amount.
“The gross is £3,000 and the mean profit £1,000. That’s the bare minimum.”
Giuseppe now has his own YouTube property channel and is also training to be a mortgage broker.
“If you’re financially free and don’t do anything, you get bored. For me teaching has been a passion. I love being on stage and feeling the energy of the audience. So, I want to share what I’ve learnt.”
His family is his main motivation, he says. His wife is Mexican, while his two children were born in Scotland.
“For me family is everything. I had to do something to make our future a better future. It’s not that it was bad. I just wanted a better future. We have family in Italy and Mexico and wanted to travel but we couldn’t afford it with one salary. I had a good salary, but it wasn’t enough for a family of four. So, I had to do something.”
His apartments are booked and his buy-to-lets filled, giving him complete freedom to do what he wants with his life.
“If you don’t have that freedom of choice you have to do something to get it because that allows you to do anything in life. It’s not about money, it’s about the choices that money gives you.
“I’m 41. If I can do it, anybody can. There are no age limits or obstacles because of where you’ve come from. I didn’t have a rich background, but I did it. I had my principles, my values and my inspiration which was my family.”
- Money is not scarce. People who think they have a limit with money have to remove that idea because money is there. You just need to find a way to get it.
- You need to define where you want to be. What’s the point in getting into property if you don’t know where you’re going? It’s important to have a business plan.
- Start small with one project. Then you can master it and move to the next one and do bigger deals. There’s no point in overwhelming yourself at the beginning. I work a lot on mindset. That’s the reason why I believe that everything is possible. You just need to find the right tools.
Samuel Leeds’ verdict
“I know people who’ve got a lot more houses, but Giuseppe makes more money. You have to maximise every property properly. He has done really well to accumulate a large portfolio in the space of a few years. He is very smart with money and has found his niche in Scotland.
“His heart is also to see other people win. I’m really excited to see what he does next and the ripple effect of who he helps as a trainer.”
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