ASK502: Should I re-invest in higher quality properties? PLUS: What can I do about this water damage?

0:02Hi, I'm Rob. And I'm Rob. And this is Ask Rob and Rob. Welcome to Ask Rob and Rob, a show we've been doing for a long, long time now where you ask us questions and we give you answers. It's simple, it works, and it works because you send in lovely questions. First, here's a reminder of how you can follow in their footsteps. It's super simple. You head over to propertyhub.net forward slash ask and there you can get your question in in a variety of ways. You can leave us a voicemail. You can leave a computer recording. You can even write in and maybe see your question in the Sunday Times. We do not mind at all, as long as you keep doing it.

0:39Okay, let's listen to our first question in from David. Hi, Rob and Rob. Thanks for all the hard work you boys put on for these podcasts and content. It's really helped me over the couple of months that I've been listening to it. I've been a landlord for, well, since I was 19 in my own personal name. I've got a grade two listed building in the Isle of Wight that I'm now looking to get rid of because it's a bit of a pain, to be honest. My question to you boys is when I sell the property, would you put it in two really nice properties or three average properties? I'm looking to put it into a limited company at the start of the year.

1:22And my current contract runs out in February next year with the current tenant. Look forward to your answer and cheers for all the top work you've always done. David, thank you for your question. This comes back to a few things, but let's start with strategy. Really get clear on what you want from property. Now, occasionally we bring this S word up on the podcast. and I know not everybody will like us bringing it up because it makes you feel awkward when you listen to us talk about strategy because you know you haven't got one and David this is not aimed at you this is aimed at a lot of people listening right now I know you yeah yeah you in the gym right now you haven't got a strategy and yet that person walking your dog yeah you haven't got a strategy either you've got tactics but you don't have a strategy a bigger plan of why are you investing you might have something vague a goal but do you have a clear strategy and that is so important a goal is the first step having a goal but then once you've got that goal that you then build back to have a strategy so how do you put a strategy together well that's a big podcast but some quick tips is one understand your circumstances so not just your financial circumstances but your skill sets the time that you have your risk tolerance those type of things and then look the outcomes you want to achieve, the type of experience you want to have an investor.

2:42Are you going to be super hands-on because you've got lots of free time and you're good with your hands and you can refer properties? Or are you super busy and you don't really have any desire to be working on the property at weekends to bring it up to scratch? So you're going to go for a more passive approach. You can only answer those questions. Putting that time aside will then guide you. In terms of the amount of properties that you go for, there are pros and cons for going down each route. What I would say is avoid, if you can, particularly if you're time poor, going into as many properties as you can if those properties then become deemed cheaper properties.

3:20Properties in areas that people don't desire as much. You're better going for better areas and better properties as a general rule. Again, it will depend on your strategy. the other thing is the more properties that you have the more work you have to do makes sense right but not everybody thinks it through a lot of people have a goal of owning a lot of properties i do not want that goal rob d does not want that goal that is not something to aspire to what you want is a really strong portfolio value but you don't want 20 30 40 properties in your portfolio or have the aspiration to get to that. It may sound cool, but I promise you, as soon as you get over 10 properties, it's a pain in the bum.

4:03It really is. And it can be hard work before 10 as well. So what you want to focus on is portfolio value. With all that in mind, David, I think you can start to put yourself into a position where you can make decisions, get clear on your strategy, know what type of properties that money will allow you to buy. That may then rule out one of the directions that you've said, and you can make progress from there. Of course, I just want to highlight one of the downsides for going for less properties, just in the sake of balance, is it can really skew your view of a portfolio. So if you've only got one or two properties and they are both brilliant, you think property is super easy.

4:39If they're both a challenge or worse, nightmare properties, then you think property is a disaster. That curse of the small portfolio makes you feel like it's one way or the other when it's somewhere in between. but the fact that you've got a property that you said it already is a pain seems that you're protected from that but this is more advice for the wider audience of people listening so david take those steps use that as a bit of a guide and hope you get to an outcome that you want good luck okay let's have our next question now from dimarda hi rob and rob thank you for all the information you share i currently own a flat in a block of flax a couple of months ago there There was a leak from the flat above mine.

5:18The water caused damage to my ceiling and electrical system, which I had to repair. I contacted the landlord of the flat above. They refused to take the responsibility, so they didn't pay. Unfortunately, the same thing happened again. A few days ago, it caused more damages to my ceiling and electrical work. I wrote to the block manager of the company. they told me that it's the responsibility of the owner of the flat table not them my question is what steps can i take in this situation to recover the cost of the damage thank you thank you for your question and it's funny because i have had this exact same thing happen to me several times and our producer has had the same thing happen to him and we were chatting about it before we recorded recently.

6:06And the approach that I took and the advice that we gave to Dan, our producer, was just chalk it up to experience. You're probably not going to get your money back. So I thought I'd get straight in with a pragmatic answer before I give you some more options. And it depends on circumstances, right? You can have neighbours who are far more amenable and you can have better options. But in my case, it's like, I know that I'm never going to get anywhere with this. It's going to annoy me every time I do think about, and I'm probably not going to get the result anyway. So I'd rather just take the financial hit, unfair though it is.

6:34Now, I know that that's a lucky position to be in to be able to do that but that's where I got to because these situations are really hard. You do have some options though so the first thing I would do is push back on the managing agent a little bit to make sure that what they've told you is correct because sometimes it is possible to claim on the building insurance for the resulting damage even though the leak originated elsewhere. It depends on the policy and you'd have to pay the excess in any case but it is something just to check. Obviously if you have your own contents insurance which covers escape of water then that might cover you then your insurer might go and pursue the upstairs owner but that's up to them i presume you don't have that insurance though otherwise you probably wouldn't be asking this question the final thing you can do is push harder on the owner of the flat upstairs so if you've had a conversation that hasn't got you very far then writing to them formally maybe writing to them via solicitor setting out the costs that you've incurred and giving them a time scale to pay saying you'll pursue the matter if they don't pay that might make them more motivated you never know if they don't cough up at that point then there is the option of taking them to the small claims court but I wouldn't rate your chances particularly highly of being successful so those are your options as I see them I'm sorry that there's no killer answer of do this and you'll be guaranteed success but in the absence of one say yeah think about how far you want to take it and how much time you want to invest in this unfortunately it is unfair but these things do sometimes happen but really appreciate your question and I hope you get a good result.

8:01Well, that's us done for another week. We'll be back soon with the podcast on Thursday. Property Pulse will be landing in your inboxes on Friday. There's loads going on our YouTube channel. You'll see us on Sunday in the Sunday Times. And then, guess what? We'll be back same time, same place next week answering more of your questions. Until then, take care, have fun. Bye-bye. Bye-bye.