.jpg)
The Money Gains Podcast
Welcome to the Money Gains Podcast, where we talk all things money and how to grow your bank balance. Hosted by Sammie Ellard-King, Money Content Creator of the Year 2024, we chat with the sharpest minds in personal finance to give you real, actionable advice – no fluff, no jargon.
Whether you're skint, smashing it, or somewhere in between, we’re here to help you make smarter money moves.
The Money Gains Podcast
Why The UK Housing Market Will Explode In 2026 - (James Gerrard)
Society is splitting in two - which side you're on will determine your financial future.
---------
Get The FREE 10 Step Checklist That Grew My Portfolio To Over £160,000+ 👇
🔗 https://upthegains.co.uk/investing-checklist
---------
In this episode of the Money Gains Podcast we welcome James Gerrard to the show.
James is a property investor, business owner and speaker with a unique view on the current economic landscape and how the middle class is effectively vanishing.
---------
👉🏼 Get a FREE FRACTIONAL SHARE worth up £100 when you deposit £1 with Trading 212
🔗 https://www.trading212.com/join/MGP
If you don't receive the free fractional share - head to the menu and put the word 'MGP' into the promo code section.
(Capital at risk when you invest)
---------
👉🏼 We're delighted to welcome TIDE as a sponsor for the show.
OFFER - Get £100 Cashback when you deposit £5,000 within 30 days (T&C's Apply)
🔗 https://www.tide.co/offers/gains/
---------
James on Instagram https://www.instagram.com/jamesgerrard/
James online https://www.james-gerrard.com/
---------
✅ Why your family home is a lifestyle purchase, not an investment
✅ How institutional investors like Blackstone are creating the biggest generational buying opportunity in decades
✅ Why Prime Central London property has crashed 38% since 2014
✅ How to enter property investing with zero capital
✅ Why the TIDED framework is pushing up the "drawbridge" between asset owners and wage earners
---------
DISCLAIMER:
This video is meant for educational purposes and should not be considered financial advice. When you invest your capital is at risk. Past performance is not a guarantee of future success.
This video description contains affiliate links - if you click on one and make a purchase we may receive a small commission. This does not alter our suggestions and there is no charge for you.
Take the FREE Money Personality Quiz 👉🏼 https://upthegains.co.uk/quiz
Get The FREE 10 Step Checklist That Grew My Portfolio To Over £160,000+ 👇
🔗 https://upthegains.co.uk/investing-checklist
So, James, welcome to the Money Agains Podcast, man. How are you?
Speaker:I'm well, Sammy. Thank you so much for having me. This is brilliant. This is exciting.
Speaker 2:Honestly, uh, we're in a new space and this is cool, isn't it?
Speaker:This I well, you know, I'm loving your library. You know, this is your grandfather's love.
Speaker 2:How long has this been in your family for? It's been here. Honestly, uh around about five minutes. Really?
Speaker:That's sick. We'll never get to take it when you leave.
Speaker 2:But I have been absolutely loving your content, man. I I said to you before, I've been following you since about 8,000 followers, and you've just grown. But it's really nice to see someone talking sense about things on the internet, which is a rarity, as we all well know. But I think it would be really cool because your story is amazing. And from what you've done to where you've got to today and the business that you run, it's just absolutely incredible. But I want to start at the beginning for you like, what was money like for you growing up?
Speaker:Yeah, yeah. So I think the the most uh the defining point in that journey was really when I was a teenager and my my dad, who worked in a company where he was organizing advertising on ticket wallets. So back in the day, right, when you ordered a plane ticket, it came in an actual physical wallet, a paper wallet that was posted to you. Remember that? Um, and he did the advertising on the wallet. And obviously, if you were you know going abroad and you wanted to buy some sun cream or whatever, all the companies wanted to advertise on that. And basically in 1998, they introduced the first e-wallet on the airlines. And by 2004, every single airline in the world had e-tickets. So the requirement for a physical envelope disappeared. So did his job, so did his role, so did that entire industry so importantly. So we really went from, you know, uh, you know, comfortable existence to losing our home. We weren't able to cover the mortgages on our on our property. So my dad had to um uh sell the house. And I remember, you know, quite vivid memories of you know, my family in tears as you know, things that they'd held on to for a number of years and become attached to had to be thrown away or chucked or sold or whatever it was, um, and effectively, you know, moved out into um you know into a rental and lost our kind of family home. And you know, that was kind of a very informative uh time in my life, and also understood for me the importance of what I now call freedom, security, and wealth, which is this idea that wealth isn't just an amount of money, it is tied in with your security and it's tied in with your freedom. You know, if you have a house which is heavily mortgaged, and his wasn't, right? But if it was heavily mortgaged, you know, to what degree are you free? To what degree are you wealthy? To what degree do you have security? Yeah. And, you know, that was a time what 1998, 2004, dot com, etc., we're now entering to that same phase again where people, like my dad, he didn't just lose his job, his entire industry disappeared. Yeah, you know, he's circa 50 years old. He doesn't just then call up, you know, call up the helpline, whatever, and get another job. His entire industry disappeared. He would have had to retrain entirely for a totally different industry, which you know, midlife he wasn't able to do. And I think, you know, the sad thing about that was that was something that he took very personally onto his shoulders as a man responsible for the household and the family. And that sort of accelerated, um, you know, I've shed you know, probably a bit, you know, his um his alcoholism, which really ultimately uh ended in him uh contracting uh stomach cancer, which spread through his body, and eventually he he passed away. And you know, I think you know, after after he passed away, I I probably only got more and more context. And also as I you know became a father myself, two kids, married, some of the responsibilities that I began to take on, I began to see in my father what he must have gone through during the same time, the same fears, the same doubts, the same insecurities. And I think that's also kind of really fueled like my desire to, in a very, very small way, trying to get a message out there for people in terms of understanding what real freedom is, understanding what security is, understanding what real wealth is, especially when it comes to real estate. And then, really from that, that really drove me to take some big risks. The first big decision I made was moving to London. So for me, when I was doing, I say now because kids are right now choosing which universities to go to, et cetera, is I had to be in London. One of the best pieces of advice I received young was to be in the biggest pool of wealth you possibly can be. And because specifically in the UK, we have had such a big disparity between London and the rest of the country, being in London is so, so important. So that's why I headed here. And then sure enough, I met a guy who took three real estate development companies public. I was studying at the LSE at the time. Um, actually a small stint at uh Goldman's on the interim program, but I met this guy taking three companies public. I remember the day he's walking outside of his house. I'm going there for a meeting, Gucci sunglasses on, Gucci shoes, suave hair, you know, his late 50s. James, I took my first three companies public from my kitchen table. I'm gonna do it a fourth time. Come join me, right? And um, yeah, so he I jumped into his Rolls Royce for the interview, uh, onto his uh next meeting, which was probably quite fitting given the fact all my shots now I'd done a in a taxi. Um, and he really took me on his wing, you know, from 7 a.m. to 9 p.m. I was giving him coffee in the morning and you know, going on dinner dates with him and uh you know, meeting and being introduced to the most amazing people, household entrepreneurs that you know people know at home. And so that really kind of took me to what I call the you know the top table. Um I became responsible for raising his capital for a prime central London business. We were selling five, you know, five, ten, fifteen million pound houses. Um, and then after a couple of years, I said, Why am I raising money for everyone else? I can raise money for myself. Um and I set up a firm basically doing new build uh residential development, and we built that up to in excess of 200 units, either in planning, uh, got planning mission for all built out. So mostly kind of uh East London apartment blocks, uh 30 to 60 unit uh mixed-use schemes with commercial. And then 2018 began to sell out of that. We won property week awards, you know, one of one of the youngest uh winners of the property week awards was a big in this uh big awards uh situation in in my industry, and then it got married, kids in sort of 2022 thought, right, what am I gonna, what am I gonna do with my life um next? As you do, as you do. Yeah, it was a weird, weird scenario, but no, not from a point of view, you know, I had like so much money, but from a point of view, it was just like I think what was interesting was that when I was 22, 23, 24, I fell into the industry. Yeah, yeah. I fell into real estate, and then I found myself doing new build development. And I was very lucky. Um, I say lucky, I consciously moved out of prime central London and moved into what I called private affordable housing. The government was giving help to buy 95% financing, giving 95% financing to homes up to 600,000 pounds. Well, guess what? Any flat we sold was 600,000 pounds because the difference between you buying a 500,000 pound flat or a 600k flat was five grand. So we're gonna sell everything for 600k. And at that point, I really began to understand, especially with you know my background, was that real estate was driven by macroeconomic factors. It was driven by money supply. So Prime Central London at that point, high levels of stamp duty gone from 3% to 15%. Literally at that moment, the market collapsed. No one knew about it until 11 years later. We got out of it, we started going down uh what I call private affordable housing. And so I looked at the market in 22 and I said, right, what's gonna happen next? And then I set up uh effectively what I do now, which is an asset management business, and we we invest into low and medium income housing buying apartment blocks. And how big is that firm now? So in two years, we've scaled it to an excess of 30 million of assets under management, and you know, we'll probably be um close to 100 million by the end of 2027. Wow, super aggressive at the moment then. Yeah, well, this is a generational buying opportunity, yeah, it really is.
Speaker 2:I I'm I don't want to spoil it, but there's a couple of things that I think is really important to unpack for people because I think from what you've said there, you obviously got the break by meeting the gentleman that you did at the time. But before that, you went to university and you placed yourself in an opportunity where there was a better outcome potentially for you. Right. And for people with kids and young families and perhaps even young people watching this or listening to this now, like what could they do in that situation? To get to LSE, you have to be pretty good at some things. Because I heard you say, like, you weren't amazing at maths or economics, but you loved history. Yeah. And I resonate with that because I have medieval medieval history for me, kings and queens. Oh, wow, very good. I'm absolutely obsessed. And so to go to that, you obviously need good grades. Yeah. But if you don't have good grades, or perhaps you're in your mid-20s now, like what's some of the things that you would suggest doing to maybe find that billionaire that they could latch on to.
Speaker:Right. Well, I think the interesting thing was just the fact that I went to LSE wasn't the defining factor. No. The fact that I was in London and had I gone to another university doing something else, again, I did history, I didn't do you know economics or or math. Um, and so my point was it was surrounding yourself in the largest pool. You can be the most perfect seed, but if you plant yourself in the desert, you're never gonna grow. Equally, you can be the most flawed seed, perhaps not the most, but you can be a flawed seed and plant yourself in a rainforest, and you will find a way of growing. And so I think understanding where your environment is that you would most succeed in is really important. So, you know, for instance, I hear often people want to start uh a tech business or you know, young entrepreneurs come to me wanting to angel invest or whatever it is. And one of the things that I can't help but think is look, you're already on the back foot. There is a market in the US which is a hundred times bigger than this. Um, and I remember early days when I was investing into different um, you know, startups. One of the my startups I invest in, um, Mark Cuban invested in after me with half here's a funny story. So my friend um who who started a business, he got Mark Cuban to invest into his business with half a million dollars uh over email.
Speaker 2:Over email. Never even met him.
Speaker:Never even met him.
Speaker 2:I love that. I wish I could do that. Just do dumb raising.
Speaker:Can I have half a million dollars? And it wasn't that easy.
Speaker 2:It must be blood, sweat, and tears trying to get an SEIS around. Yeah, I can imagine.
Speaker:Yeah, yeah, yeah. Um, so you know, I I think um, you know, what he he said to me in the time is it's very difficult to get employees, the programmers, the engineers, because at the time they were going to the US. So my point is is where is the best place for you to be? Um for me, it was about being surrounded by the most amount of capital, the most amount of money, and that was London. And I think particularly as I said in the UK, you know, we have such a big disparity. Um, it was about surrounding myself with the wealthiest people, with the wealthiest surroundings, so that you know it gives me the best opportunity.
Speaker 2:Yeah, it's about opportunity, isn't it? Like you you know that in Manchester or even Leeds or whatever that might not be, it's just gonna be few and far between. You're gonna have to strike extremely lucky. However, you're you know, if you're placing a bet on the horse race, you place a bet on the favourite, right? And London is the favourite in this.
Speaker:Well, and I think the interesting thing is uh the exception to that is you know, we look at Jabai at the moment. So 240,000 expats now live in the Emirates. Absolutely. Okay, and I do have a slight thesis that as everyone looks left, maybe you should look right. Um, so there's maybe perhaps an extension of the metaphor is that if you were to clear the rainforest and suddenly there was a bit more opportunity out there, you know, at home, then that could be another interesting thing. So I think you're not not necessarily the answer is like running away to a broader or a different economy. Um sometimes it's about understanding which industry you're in and understanding whether there's enough money supply in that industry um for where you geographically live, as an example.
Speaker 2:Yeah, I can relate to that. I that's why I call it our hospitalities, right? 3% margins if you're lucky. Right. And you're struggling.
Speaker:Right. And oh, exactly, and that's a great example because then you're in a business right now which is you know trans global. You know, you can as you know, as long as you're not limited by the English language, you can raise capital anywhere. And I think a lot of people in the creative industry now are learning the fact that the US market, you know, is whatever, 100 times, thousand times bigger than the UK market. Well, this is great. I can have a UK cost of living and I can have my clients in the US who can pay me a lot more than UK clients. So again, there's there's an aspect to that. But it's about understanding fundamentally, you know, where is the money, where are the pools of opportunity, and then positioning yourself in the largest pool of opportunity. Yeah, I love that you say that.
Speaker 2:Now, I I loved your paper that you did, but when I say to you the drawbridge, what does that mean? And what does it mean for me, perhaps?
Speaker:So our thesis when I started um our asset management business was really I wrote a paper to our investors' partner shareholders, and I basically said, look, um, the world is dividing into two, you know, whether you've got west, east, you've got um people having more and more poverty, more and more people having extreme uh affluence. So you look at our politics, it's left and right, even if you look at the divisions between male and female, like all these things, everywhere we look, we're getting polarization. But specifically in terms of financing, it was this idea that this drawbridge is going up and up every single day. And for those who own assets, you're on the side of abundance, life is getting easier and easier and easier. It's like a downhill slalom. As you own assets, they produce more passive income. You use that passive income to buy up more assets, and you get more passive income, you use that passive income to buy more assets. And it's like a drawbridge going up and up and up, and you're on the great side of abundance and you slide down very easily. But on the other side of it, you're on the side of struggle. You know, and that's a life where the cost of living is going up, asset prices are increasing, and you can't keep up with rent, you can't keep up with the deposit for a house, etc., etc. So the importance uh of jumping that drawbridge, moving from that side of struggle to that side of abundance is ever, ever more important. But the question is what drives that drawbridge? And that's everyone knows that it's more painful, everyone knows it's more difficult out there. But the question is why? And once you understand why, you can either solve it or you can also perhaps understand the rules of the game to actually jump from one side to the other. And I kind of coined a term tided, and it's tidyed, tied plus the D because I couldn't quite come up with the accurate. But you know, and I kind of ground it as technology, inflation, demographics, economic taxation, um, and deglobalization as uh five key principles, which was the tide that was pushing up the drawbridge. You know, you look at technology, things are becoming cheaper. You Amazon's taking out your the high street, you've got Netflix taking out the cinemas, you've got um uh what else have we got? We've got Airbnb taking out the hotels, um, you've got Blackstone who taking out you know everyday landlords, right? So um you've you've definitely got uh you know technology coming in there. You've got inflation, obviously, which you know I'm sure your viewers are very cognizant of. Um we've got deglobalization, which I think is a really important one. Part of my paper which brought investors on board was this idea that post-COVID, inflation was not being driven by overabundant money supply in the system, as we printed billions and billions, trillions of um dollars and pounds, but it was actually driven by deglobalization. This idea that fundamentally the cost of moving your products from China to the States or moving oil from the Gulf around the world was becoming more and more uh expensive as you went through this process of deglobalization, which is fundamentally um you know, for those the the the working world order of the inter-relationships between countries was was breaking down, and that fundamentally was driving up costs. You know, you even you've also got a situation with increased wages, you know, uh Vietnamese wages have gone up 60 plus percent over the last 10 years, and Poland they've gone up over 40 percent, but in the UK they flatlined. Yeah, right. So bigger GDP per capita counter than the UK. Right, right. It's crazy, which is astonishing. So so that was um, you know, the uh uh deglobalization, taxation, obviously increasing economic taxation, and then finally demographics, you know, we've got an older population, etc. etc., driving driving things. So that was all basically pushing up asset prices and um making people feel poorer. So unless there's a politician out there with an answer to all of those five points, then um position yourself carefully in the coming coming future.
Speaker 2:Yeah, absolutely. But one of the things you mentioned is that people still can sort of jump over that bridge and they can arm themselves with the right tools to get over it and really start creating that slide down.
Speaker:Yeah, and I think the harpit of that that solution is actually the first step, which is um self-belief, knowledge and inaction. You know, before any jump that you made in your life, whether you're a kid jumping across a sofa, whether you're um, you know, doing some jumping across a river or whatever it is, you had to believe that you could do it. And without that belief, you never went out and acquired the knowledge to know how to do it. And without that knowledge, you would never actually take the action and actually do do it. And so a big part of actually what um I often don't talk about, but is what my mentor showed me, my boss at that time, is he took me to different types of he was going through a process in his own life and he started introducing me to all sorts of incredible esoteric wisdoms and spiritual teachers and you know, um, whether it be um or more kind of um educators, impressional educators, and a lot of it actually helped me, especially through him, to understand that anything was possible. I remember I was sitting in the office one day and he throws a Times 100 ritualist at me, you know, with literally circle, circle, meeting here, ask for meeting here, organize meeting with so-and-so, organize meeting. I'm like, how am I gonna call up that guy, right, and ask for a meeting? He's the time, you know, fifth most wealthy person in the country. But for him, there was no boundary to what you could do or achieve.
Speaker 2:I'll speak to him, I'll do that.
Speaker:Yeah, yeah, yeah. You you find a way. And so that was really eye-opening for me was actually being able to be surrounded by somebody who where there weren't no limitations. Anything was possible. And he would for him, it wasn't the fact that nothing was impossible because he'd taken three companies public. It was that that was his mindset, and that's how he got to be in a place where he had taken three companies public. And so, in terms of the jump, you know, making that jump, it's about really at the beginning is developing your your your thought systems, your beliefs, understanding that it is possible, and then choosing where and which industry you want to develop knowledge in so that you can then action it and actually create wealth for yourself.
Speaker 2:Yeah, I I I love that you think like that because it does come down to self-belief, and it kind of leads me very nicely into my next question. So, thank you for that. So, why then in this day and age where we have a wealth of information at our fingertips, like do we struggle to kind of grasp that opportunity about you know the wealth that we could get in front of us, essentially?
Speaker:Yeah, I think well, actually, do you want to I I I feel quite counted with that. You know, one of the things that I'm really pro at the moment is that the access to information we have now is beyond what we've ever had before. And I think the answer to that uh question really lies in the seed of what we talked about previously, which was self-belief. You know, that we have all the information now, but you need self-belief, knowledge, and action. You can't just have the knowledge. And so that's a really nice thing. Oh, that's that's how you turn a development site into 50 units. Oh, that's how you uh take a disused commercial unit and you know, stick Tesco's in it and create passive income, right? That's all nice ideas, but I don't believe I can do it. So, how do you change that consciousness? How do you change your mindset to get to a point where you've fortified your mind where you're not limited by fear, you're not limited by doubt? You know, Disraeli, who was a um British Prime Minister, said, I'm paraphrasing but you know, you rise as high as you can think. You know, and I think we currently, I think I saw a stat the other day, who knows where from, right? But we're the second most oppressed country in the world. Um and I think that is our biggest limiting factor, and that's been our limiting factor for 75 plus years. You know, we have a serious issue of lack of self-appreciation and self-doubt in this country. And what happens is that those who don't often leave. You know, they go to the States, they go abroad, or they do, you know, commercialise something here and then leave and then go abroad. Um, you know, the biggest complaints I hear of successful entrepreneurs, oh, I went to America and everyone's got such a can-do attitude, you know, blah, blah, blah. I'm like, okay, great, but you know, we're not, we're here in Blighty. So yeah, I think uh in answer to a question, uh it's it's again, it goes back to self-belief. We've got all the knowledge, everything's at our fingertips right now, but there is a still prevailing belief that I can't do it. Everything's acts against me, the odds are against me. And I'm saying, you know, from the point of view of you know, coming from a from a home which was um you know, d let's call it the dysfunctional, and then coming from a point of then having financial dysfunction, um, it's all to do with mindset. And I was lucky because that mentor at that point in time plucked me and put me not into a pool of wealth, but pool put me into a pool of high consciousness of positive thinking of anything was possible. And when I was literally living with him from 7 a.m. to 9 p.m., that's all that I was surrounded by. And then suddenly I realized that, oh, I can do this myself, and then I left and did it myself.
Speaker 2:It's so funny you say that because uh I read a paper the other day and it it sort of um made me chuckle in my mind because I I have a similar story to you. My father's business went um, you know, absolutely haywire and uh like completely flipped our family round, everyone broke up, split up, went their own separate ways, etc. And it was like quite formative. I was 16. So it was like a quite pivotal period of your sort of teenage years. But I saw the stat and it said 71% had the parents had either split up or they'd gone through some sort of trauma were entrepreneurs. Wow, interesting. So I was like, I think when something like that happens to you, you are forced to look at the whole world. Yeah, and it sort of happens to you in like a really quick time. Yeah, and especially when you're young like that, you're a sponge. Yeah. And you're like, you don't have as much fear inside of you. It's still there, and that's probably what drives you. You use it as a force because you kind of have to at that point, because you're like, well, I've got to look after myself right now. And I do find that in a lot of the entrepreneurs that I know, they've had something happen in their lives which has just driven them.
Speaker:Yeah, I mean, there are two things that I love about that that moment where you got to, well, I've got to look after myself. And that was that when you said that, that really struck with me because that's how I felt. I was like, wow, there is there is no safety net and there is no house that's gonna give you security, there's no you know, place that you can go crash or whatever. Like you've got to make this happen. And if you don't, then you see where it where it goes, like quite physically in front of you. And so I think that is you know, self-responsibility and taking ownership is important. I think the probably the most um powerful tool I probably ever uh really developed in terms of mindset was understanding that the ability really to look through that illusion of defeat and see the reality of opportunity in every moment is that when when things were really difficult, that it's not just the fact that you everyone in life, even listening to us now, will will think back to a moment which was challenging in their life, which was difficult, which was painful. But how long was it till you look back that you realize actually that was a positive thing or that was a good thing, or I learned from that? Sometimes it takes a week, sometimes it takes a year, sometimes it takes 10 years, sometimes it takes 50 years. But the ability to shorten that space to the point that in the moment of pain and doubt and anguish and and disappointment, you're excited. Not just that you're accepting, but you're excited because you know that really this is the golden ticket to your next level, that this pain is stretching me, it's expanding me, forcing me to grow. And the aspect of growing is an effect of which helps me achieve my goals, it builds my gravitas, it helps me to become more and attract more into my life. And so I for me personally, the the biggest tool was always that when we had challenges, when we had difficulties, I just found out today or zumped on a property. And I'm like, thank you, that's exciting. You know, like where is the opportunity here? Like, how do I turn this into a win? And I think that is a really your key, key piece. And if you have that, no matter what you're going through in life, you can find that you can find the opportunity in England.
Speaker 2:I think it's about for me, and I'm sure you're very similar. I mean, you've just mentioned his example there, is that like I actually enjoy failing. I really enjoy it because I'm like, well, brilliant. Like, yeah, let's take everything we've learned there and never do that again. Yeah, yeah. But we're gonna do it like this. Oh, and that failed too. Great. Well, what we're gonna do now, and we if you keep doing that, compounding failure, yeah, yeah, yeah. It compounding failure ends in success. It really does. If you as long as you to a degree, well, I think that'd be as long as you keep going, or you keep shooting for the moon, eventually you're gonna hit it. Right, that's it.
Speaker:Yeah, I know you trigger the story in my mind. I I remember when we did our when I first um you know left left that that employment and start my own my own shop, and I remember that we'd uh secured this site. Um, we were getting planning commission for 19 apartments on it, and um I was in legals, I didn't have really have enough money even to go through the legal process. And I'm thinking, oh my god, I'm gonna lose all my money, or my friends are gonna think I'm an idiot, you know, my my my mum's gonna you know think I've just you know you know wasted a deposit on a house or or whatever to go and uh do this speculative transaction. But I remember getting to the point, and you know, it sounds silly now, but you know, waking up in the night with sweats because I thought I was gonna lose everything, um and actually realizing no, I'm gonna move ahead, not because I think I'm gonna make loads of money out of this, I'm gonna move ahead because at the worst case scenario, I overcome my fear. I overcome my fear of what people think, I overcome my fear of um what people um what my family might think of me, the expectations people put on me, you know, win or lose, I break that and that gives me freedom. And with that freedom, I can go off and do whatever I see fit next. So I think that's uh important point we share.
Speaker 2:Yeah, I absolutely love that. And I think it it crosses over quite clearly that people need to find that belief, people need to unlock that in themselves. And I think we all know this, and often it only really comes when the pain gets enough that you're so tired of it because you are okay with your 50 grand salary and your two cars on the drive and your your Spanish trip to the things, and you don't address the fact that you're not my Spanish trips at all. A little bit of tafas, a little bit of a little bit of you know, it never goes wrong. But the the main thing is is that uh they're not like scared, they're okay at that point. But you've said that that's changing, right? So the middle class is dying, right? And it really is starting to become a problem, and these are whole industries, as we know from your father, but now it's under serious threat.
Speaker:Yeah, yeah.
Speaker 2:Why is it that the middle class is dying, do you think?
Speaker:I mean, that that's this lovely thing that you showed, and I think that's his uh when the pain of change, right, is no longer as great as the pain of chain of staying the same. That's normally when we we do something about it.
Speaker 2:You got the quote, I pictured it. Yeah, yeah, yeah.
Speaker:I was getting that I kind of was clamoring at it there, but that that that's that's broadly it. And oddly enough, you know, my my dad, I remember you giving me a flashback. My dad you know came home and say, Yeah, honestly, the government, you know. I give them a call, and every single time they've got this marketing budget that they have to spend on travel. So I just give them a call at the end of the financial year and they like hand over this money, you know, to the to the account, you know whether it be for like malaria, sprays for the thick wall of business. And I think that part of the reason why that middle class um piece is dying is because the game is changing. The game isn't changing, it's changed. You know, the engines have stopped, the engines are blown out on the plane, and at the moment we're just in a gliding freefall, and no one's screaming yet because we haven't actually realized the fact that the engines are turned off. And that that just what I want to get across is that my dad in 1998, those e-tickets, you know, to e-wallets, whatever came before, six years later, they were all gone. That was 25 years ago. Like what's happening now, it happens, it happens, it happened. It's happening, it's happening, it's happening, it happened. Right? And it it swap, it it switches like that in a moment. And the reason why that that middle class is is under pressure, the reason why the Henries keep getting taxed ahead out of is because the wealth is being extracted by international corporations at the top, the rich who then get blamed for this, you know, who build businesses and doing their doing their bit, then you know, um, then leave or or protect themselves or knuckle down. And also, of course, as I shared, you know, the asset prices going up, you know, more passive and passive income flowing through to them. But then on the other side, you've got um people who are uh really being supported by the state, and the state obviously relies on that power base for voting for support, um, and they're not gonna let those people suffer. So their wages will be linked to inflation, they will continue to um increase and reduce stamp duty at that lower end of the buying um uh the buying scale. And so you're kind of in a in a position that if you are stuck in the middle, you're gonna be that squeezed middle that we hear so much about. And ultimately, that middle will be split. You'll either make it or you're gonna be on the on the other side. Um, and that's why it's you know dying, because the wealth is being extracted by um institutions and corporations which we then don't see the value from. So those technology companies we talked about earlier, the Nando's, etc. Yeah. You know, that that that income gets taken offshore and gets taxed offshore if or if at all by a different jurisdiction. And so we wonder why, you know, we're not um generating enough revenues, and it's because our businesses are closing down, the ones that do pay tax, and the ones that don't are really successful and they're overseas and they're taking advantage of us. Yeah. And I think that the final bit, especially for the UK, is if you go back to 2014 to 2024, um, average American salaries have increased from circa 47k to 57k. The average UK salary has increased from 33,000 to 36,000. Uh, but if you what's interesting is if you take the top 10 percentile, average American wealth has gone up 28% to an average of 153,000 pounds. But in the UK, it's gone from 70,000 pounds to 71,000 pounds across that same same time period. Across that period, UBS um wealth report suggested that uh 54% of all global assets were now owned by Americans. And so what you've got is you've got effectively, you know, the colonialization of the UK, you know, it's the 51st state, and there's a great book, I can't remember the author, but the vassal state. Um and really it's this understanding that uh America, especially post the financial crisis, has become incredibly wealthy, disproportionately wealthy UK as we've continued then to stutter along. And the problem that we've got is that we are a user of all the great American companies and everything, but we don't actually see the benefit or the revenue from that from our from our nation. So it's total wealth extraction and there's nothing coming back. And I think we've we've we've been damaged by that, um, especially because all the ingenuity and entrepreneurship of what we want to create quickly gets brought up also by American companies. So again, we don't see the the wealth of it. So, you know, and our blacks are going to come in with a hundred billion um commitment for 10 years, which is so exciting. You make such great headlines, no? 100 billion to invest over the next 10 years, woo, we're gonna be, we're all gonna be rich. The truth is, like any kind of um, you know, I said it did history, any any kind of uh colonial power is that the people who make the money are the people doing the deal with the colonizers, or it's um the colonizers themselves. And so, you know, blacks don't come in, they invest 100 billion, but those are not creating jobs or true true wealth for the local economy, it's it's it's asset acquisition, and that wealth gets taken out of the country. How the tables have turned. How they've well what's funny is that how the kind of political elite then clap and applaud and shake hands and say, Look what I've what I've brought, look what I've done, you know. I'm like, you know, and I think but I think what's so important is that you know there's neither bad nor good, only thinking makes it so. And so it's like, is this a good thing or is this a bad thing? Look, if you are in a if you're in politics and you um are a political fighter, then you will take a side. If you are like all of us, who are just trying to make a living. And survive and navigate this raw bridge. For us, it's just about understanding the rules of the game. And the game has changed. Now it's about money supply. Now it's about understanding that fact you've got these macro events that are happening. And how do you position yourself to benefit from them? Because the old system is not going to support you anymore. And so, you know, those guys in real estate is to understand, I keep saying it's not location, location, location anymore. It's not about average house price to average salary ratios anymore. It isn't part, right? And it isn't part location. But I say it's about demographics, demographics, demographics. And it's about money supply. It's understanding where is the flow of money coming from? Like what is going to prop up asset prices? And so when you see those kind of headlines, when you see the Norwegian Sovereign Wealth Fund by 365 million off you Grovener, when you see the Canadian Pension Fund invest a billion, when you see who else has done it recently, uh Aviva or LNG pump more and more billions into the low to medium income sector, guess what? That low to medium income sector is going to go up in value. And so it's understanding where the flows of capital are and following those flows of capital, if you want to be part of the party, if you want to take a political stance, now you know where to point your um your words.
Speaker 2:Let's break that down. So if you're listening to this and you're wondering what James means by, you know, those locations that you've mentioned or those demographics that you've mentioned and that investment and that capital flow which is coming through and the money supply. If I'm looking at this as I'm living in Northampton in my four-bedroom house that we've had in the family for 30 years, what does that mean for me? And how do I understand it from that perspective?
Speaker:Right. So the way the way the way to Broadly's look at it is it uh to take it to the extremes. If you own a five million pound house in London, you cannot go and rent that for £500,000 a year. You do not get 10% yield. But if you go buy a £120k house in Wolverhampton, you can probably get £12,000 rental income from the asset. The idea being that as you move lower down the scale of house value, you get a higher yield as in the income relative to the value of that property. And so because now we are in a world of higher inflation due to, in my opinion, deglobalization, you're now in a period of high inflation for a long period of time. So if you are an asset management business, if you are um someone who's a pension fund and you need to beat inflation, you need to go and find high-yielding assets that beat inflation. And so therefore, you're not gonna start piling your money into high-end wealthy assets, you're gonna start piling your money into low-income housing, which let's call it relatively the average house price in the UK is 270 grand. So you're gonna be ideally in a 25 to 50 percent uh percentile. So you're looking at a house price, you know, of 135k to 270k, where the pinch point, where the maximum demand is gonna be. And I always call it breaking through the clouds. Like if you're paying rent, say in London of 2,000 pounds a month, you're getting squeezed because there's so many people who can afford 2,000 pounds and there's so little stock. But if you can afford to pay 10,000 pounds a month for your rent, then far less people with that and there are far more houses. And so suddenly you kind of break through the clouds, where you get to a point, again, on the other side of the drawbridge where life gets easier because suddenly you've got less competition, there's less um demand for your space of what you want. But if you're stuck in that middle, you're you're um you know, you you you get suffered. So if you are that person, it's about okay, and I want to and I like exposure to real estate because there's so many great asset classes. I'm not someone here going, you must buy real estate, you must buy real estate. You know, I know about real estate, I built knowledge in real estate, so now I know how to navigate the asset class. So as I say to people, self-belief, knowledge, choose the industry you want to build your knowledge in and then you know capitalise on building up assets within that industry. But if you want to do real estate, my belief belief is it's uh you know low to medium income housing, which is you know where asset prices in the long term will rise.
Speaker 2:And typically that's it's outside of London. And what you've said, which is super interesting there, is that you know, if you want 10%, that's where you would go. But then that five million quid in London, well, that's 10, 15, 20 houses in these other locations. Right. And so that's when you're seeing them buying up large stocks. Right. And that's what that means.
Speaker:Yeah, yeah. And I got handed on this for like in social media because I did a clip and I I don't think it was it was taken out of context. But in short, this is the biggest generational buying opportunity that we've ever seen because and but it's the most dangerous time because in 0708, when we had the last real estate downturn, we didn't have the full development of Right Move to the extent that it is now. I couldn't search local house prices, I didn't have a camera on the back of my phone, I couldn't drop pin myself in the Google Maps and see the immediate location. So you can sit here in your office in um uh in Mayfair, you can drop pin, and I can see every single historical sales price on a street in Hull. I can see any historical sales price anywhere in the country. I can look back and see the historical records of what that uh specific house I'm buying sold for. So the ability to underwrite, as in the process of researching and analysing the opportunity that you're investing into has never been easier. And therefore, I don't need to physically go to Cumbria, I don't need to physically go to the Northeast. I can literally transfer money from London to anywhere in the country. So therefore, the movement of money is so much easier. If I want to survey a property, I can go onto Viewber and I can hire a local surveyor and he can go around and survey that property for me. I can video the whole thing and send videos to our office, and we we upload it and we watch it and we see what, see what's there. So the the challenge here is that yes, this now is a generational buying opportunity because rates are higher and asset prices are coming down, and institutions are only beginning to do this, to beginning to flood the market with capital. Um, but you're what you're gonna see is the flow of money outside of central London all over the country, which is gonna slowly raise the level of all asset prices across England because it's no longer specifically tied to the average salary, it's tied to how much money is in the system. And it's not just to do with equity, it's also to do with the amount of debt, right? Yes. So then suddenly you go, right, well, I'm a sovereign wealth fund, I want to get you know five percent of my money. Well, look, mortgages right now and buy-let property are you know five and a half percent or four and a half to five and a half percent. I'll go and start providing liquidity to mortgage providers in the bias-let sector. Now, you, your job is to as the lender to get that money out the door, you want to push the parameters. Well, God, well, we only lent out a billion pounds this year. Well, next year we need to rent uh no lend two billion. What are we gonna do? Let's loosen the criterion which we need borrowers to have so that we can lend them more money, right? And so suddenly you basically just get a full flow of capital to the worst assets in the market as well as to the best assets in the market, right? So that's basically kind of you know, in short.
Speaker 2:And what effect, in your opinion, does that have on the overall market for that person in Northampton? Are they gonna see their house price rise?
Speaker:Yeah, they're gonna see their house. So, yeah. So the the key thing there is that are you beating inflation? Right. So in normal terms, your house price is gonna rise, but are you actually seeing the real value of your house increase once you've adjusted for the process?
Speaker 2:Not necessarily. We know that if you own your own property, it's not necessarily going to rise in value enough to beat inflation, but equally on the interest that you pay.
Speaker:Right. But it depends on where in the in in the value uh scale.
Speaker 2:So through the roof.
Speaker:Well, no, what I'm saying is the top end of property, no. Like if you've got a million pound house, it's unlikely to go to two million, right? But you can see the fact that enough money supply comes at the bottom of the market where you two where a £130,000 house does become 260, right? Because because it's the loan, it gets filled up, filled at first. So you can see that uh effect going to happen. You know, and what will happen is very similar to London, where you know, 20 years ago you had a clear um diversification of values. You know, Camden was very different to Hoban and Hoban was very different to Vauxhall. But then suddenly as enough money supply came into the system, all these areas just roughly came to a thousand pounds a square foot, right? And only a few areas really kind of peaked out. And so you're kind of gonna see that, but you just, in my opinion, you know, this is real futurist stuff, but you'll just see a base level of capital like in the system, which, in my opinion, will be beyond what the average person can actually afford. And that's why we're obviously moving to a rental society, and that's why we're introducing all this legislation now to protect renters, because again, it goes back to freedom, security, and wealth. If you fundamentally feel that you have security in your house, you can't be kicked out, there's no section 21, and you've got confidence your rents aren't going to be completely extortionate, then you're probably quite happy to rent because you know you can live there forever. So the government, while they're selling off the assets and while they're um bringing in more uh corporate landlords, they're also trying to protect tenants in a small way to ensure the fact that, yes, by the way, you will never own a home, whether you know that or not. Um, but don't worry, because we've got legislation in place which should protect you. But of course, we're not going to cap it below inflation because then we would not get anyone to invest into the properties and to build the properties, and we need to build 1.5 million homes right now. So, what we're gonna do is we, if we cap it, like Scotland, we're gonna cap it plus 1% above inflation. Well, that would be 5% this year. And given the fact that salaries don't tend to keep up with inflation, let alone plus 1%, how's that gonna work? So the government's in this tricky situation where they've got to build 1.5 million homes, but they've also got to entice investors into building those homes. The problem they've got is they're not bringing in uh British institutional capital, they're bringing foreign institutional capital who's got the proper money. But the problem is that all those revenue streams don't stay in the UK, they go out of the UK, right? But when you know, anyway, we just talked about it. So that's the kind of bind that we're in. But you once you see that, once you know the rules of the game, it's not to hate it, it's not to love it. You know, you we can have our protests, you know, it's a rule. It's a rule of the game now, it's a rule of the game. So this is a rule of the game, so now you've got to play the rule of the game. Uh, and so that's that that's it. And if you don't like the rules, this is the rule of the UK. You can change rules by going to a different jurisdiction with different rules. But at the moment in the UK, these are the rules of the game.
Speaker 2:It's just interesting. And once you do see it, it's quite hard to ignore it as well. You can start looking for it everywhere. I certainly have myself. One of the things I I loved about what you said, and I think it's really important because you mentioned London there. And in your content, you said that London house prices have gone down 38% since 2014.
Speaker:Yeah.
Speaker 2:That's quite a generalization because I certainly didn't see that in some areas. Yeah, but why is that?
Speaker:So that's prime central London. So that's Kensington and Chelsea specifically. Um, so Savile's report last month said uh Prime Central London, uh, which I think is Belgravia, Mayfair, uh, Kensington and Chelsea went down 22.4% nominally in one year. Yeah, yeah, yeah, yeah, yeah. Which it was where you go, you go, you go, I I'm smiling. I'm excited. Oh, yeah, you are. Yeah, I'm just excited. But how he's in real estate, he's exposed to real. Why is he not upset? The property price has gone down 22.4%. It's a generational buying opportunity. You know, this is the time where you know you're in your 30s, you're in your 40s, you can buy in prime central London.
Speaker 2:Reason why I did that is because I would eat that up if it was the global stock market. Right, right. Yeah, if I saw a 22% drop in in a year in the stock market, I'm buying, I'm right, I'm pressing go. Right. And so it must be exactly the same for you. But you know, that £15 million mansion in Kensington.
Speaker:I love that statement. I tell you why I love that statement, right? Because you would think so. You would think so. But when you go and invest in the stock market, you're not paying 15% on the stocks that you're buying. No, right? No. So you so real estate is this really interesting thing which people don't.
Speaker 2:So capital gains, though, there's some aspects to it.
Speaker:Right. If you're in a house of your personal name, but now they're also talking about maybe removing that. So you would have to pay, you know. But what what I love is that, and people forget this when they invest in real estate, is it as much a political asset as it is an economic asset. So they see the market's gone down. A lot of my you know friends go, oh James, now's the time to buy la la la. I'm like, whoa, whoa, whoa, like how yeah, sure, there's an opportunity, but just so you know, like this is where it could go. They could introduce, they could remove um, you know, uh, they could remove the fact that you can um not pay CGT on your primary residence, they could introduce um NI on rents, they could introduce increase stamp duty, even they could reform stamp duty or even add to stamp duty and say you're gonna pay a mansion tax yearly, right? So be careful, because you're right. You're a commercial guy, you're a you're an economics guy, you you get it, your prices are down, we'll buy. Yeah, but this is not a this is not an economic game, this is a political game. Real estate is a political game. And so if you want to understand how to invest into real estate, it's like, where is the zeitgeist? We left Prime Central London in 2014 because they increased stamp duty from 3% to 15%. And we went into private affordable housing because the government started providing 95% financing to first buyers on flats between 300k and 600k. So it is a political game, and real estate is a political game, it's not just you know, understanding like the economics of the situation. And it's certainly not location, location, location.
Speaker 2:Yeah, and and those locations aren't as prime as the certainly not.
Speaker:Hackney is very interesting. So Hackney has not has this. So sorry to view it home, but it's like I love this because Hackney is very interesting. Hackney has not gone down, so the average um uh semi-detached house 1.7 million has not gone down. And you ask yourself, well, why? Because that's wave for average salaries, and it hasn't gone down because of Bank of Mum and Dad. So what's interesting is you've got your domestic buyers there, but the reason why it hasn't been here is because Johnny and whoever, you know, their parents give them literally half a million, a million quid, and now they can go and afford that townhouse in Hackney. Now, their parents, because they're English, don't have a spare three, four million pounds to go buy the house in Mayfair yet, right? But the reason so they've underpinned that market. And I think that that is like the next bubble. So you've you've got three trillion pounds worth of baby boomer wealth flooding down to millennials in Gen Z till 2050, right? The peak point of that will be 2035 to 2040. And so you ask yourself, you know, one of one of my mates bought a house house there recently. I said, So who's your buyer? When you come to sell that house, who who's who's buying that house? Oh, you know, like someone else like us will come and buy the house. I'm like, yeah, you're right. In the next 10 years, 2035, 2040, someone probably will come. Their bank of mum and dad will give them not just one million, they'll give them one and a half or two million quid to buy the house. But but once that bubble, once that capital's flowed through the system, once it's taken that 40% tax cut, once it's been wasted, spent, or misinvested or however, who's buying that home? And so what we've also got right now for again, just understand the rules of the game, we've got a massive money supply of mum and dad coming through from baby boomers, which is again, if you're an investor, take notes, but also to understand if you're a home buyer, who's buying that house from you? Like, okay, yeah, next 10 years you can see, but next 20 years, you know. So I think that's really interesting, you know, you know, limited pool of capital which energy flow through the system, and you know, eventually that bubble will pop.
Speaker 2:I agree. You know we had Dr. Eliza Philby who wrote uh in the first time. No, nice, yeah, yeah. I love her book. She's um yeah, it was just so eye-opening and you're right. The the flow of capital, but equally as well, large parts of the nation are getting older. Our birth rate is way under where it should be. Yeah, yeah. So who's going to replace the buyers once they fall off the cliff and they're no longer with us? It's no longer it's going to be an enormous supply of housing, yeah, but a lack of buyers with the capital available.
Speaker:Well, actually, and then you look at Japan. So what you are in Japan right now is literally these beautiful, beautiful castle, these homes that you can buy for £100,000, £250,000, it's because the demo the demographics have collapsed. Yeah, and so they've literally got no buyers for those homes anymore. And young people don't want to go live there. It's actually quite similar to Kensington and Chelsea and Westminster. What's nuts is that of that demographic, 40% of people were under 30 buying in Hackney, and 41% were under 40, right? So, really what you've got there, which is massive, 80% of the popul of people buying Hackney were under 40 years old. So you've basically got a situation where they're just not investing in Chelsea, Kensington Knightsbridge, because why would I want to live there when I can live in Hackney? You know, so they go.
Speaker 2:And it also used to be a pretty tough place to live, but now it's coffee shops and it's change, and everybody wants to live by you know Hackney Wick and it's kind of cool and upcoming and there's investment in the area.
Speaker:It's yeah, but uh the point for listeners is is under if you're interested in really understanding the flow of money, like where that money is going.
Speaker 2:Um Tesco pays you £92,000 a year.
Speaker:Yeah.
Speaker 2:Why?
Speaker:Do you know what I think it's because of charm, just like charm, just like you know, like smile, yeah, and I think they've just got a real affinity with like taxis, and just that's how they get a kid. I get it. Yeah, yeah. I get it.
Speaker 2:You put Tesco on the side of the taxi. Exactly.
Speaker:I think the promotion is like 1.6 million views with Tesco, like they should be paying me, they should be paying me more. Actually, it should be paying me more. I think how much how much they pay for an advert, right? Uh you know, a commercial. 1.6 million pay. Nothing. That's actually a really good point. Um, I'm literally generally gonna um so yeah, so uh what was the question?
Speaker 2:Sorry, it was uh so how do you Well, it's an interesting one. I was setting you up, obviously. I I I know why, but right.
Speaker:So why why do they pay?
Speaker 2:Yeah, because you took a disused commercial space and you sold it to them. Well, yeah, you you leased it to them. Yeah.
Speaker:Is it lease? Yeah, so that was an interesting opportunity. So often the the strategy broadly is that often you'll see new build developments go up and you'll see the fact that there's a bunch of commercial on the ground floor and it's the last thing to go because developers traditionally either don't understand commercial or just actually the nature of the market is it takes longer to get rid of your commercial. Um and so uh they're empty. And so, particularly when um development lenders have lent on a property, they want to get paid back quickly, they struggle with commercial property because it's also harder to shift. So you will often find in the market distressed commercial um sectors within a mixed-use residential development where um the bank basically wants that thing off their books as quickly as possible because it's difficult to manage and receive put into receivership compared to like a flat that they can sell. And so a real strategy there is to go around the place, you find basically developments that are struggling, and you go in and you secure uh at a meaningful discount the commercial aspect. Um, you do the work to improve the um the commercial to make it what we call shell and core. And then um you basically bring in a strong retail client who will increase the value of the asset. But the key points on that is uh commercial property is a great tool, but effectively you your your value is defined by the strength of the covenant, so the strength of the party actually paying you the rent, isn't can they pay it, pay it? Number two is the length of that commitment, and number three obviously is the amount that they're willing to pay you. So if Joe Bloggs goes and offers me 92,500 pounds a year for 50 years, but you know, he's got no no assets that he can actually prove that he can do that, that's that's not really worth that much.
Speaker 2:It's a 10-year deal with Tesco where you take it, right? Exactly.
Speaker:So or no break. So understanding actually how how the mechanics work to value the lease are slightly more complicated. But you know, if you can get your head around it, that's where the opportunity is. But also what why that's good is because there's probably like now a hundred retailers you know in the country who can provide that kind of covenant. So it doesn't it's not doesn't take that long to go and contact all of them and understand where they're wanting shops right now, and then looking in those areas for mixed use developments that are struggling and then doing a deal.
Speaker 2:So actually, you know, it's so interesting because um where I just moved from Farnham, they've built a brand new development and it's beautiful, it's so lovely built. It's it's stunning. Yeah, houses gone in, everyone's moved in, and they have an entire like market square completely empty, other than a Nando's in the corner. And the entire thing is complete, is a shell, and it's enormous. Yeah, and they messed up the real estate contracts, uh the commercial real estate contracts. Oh, wow, but they sold every single home, no problem. And it's just so obvious you would want to put those places in there because they would do really well. There's literally 6,000 people all around you, and uh, and it's a pretty cool spot for Arnhem as well, and yeah, yeah, into London, etc. And it just blows my mind because I when you said that, it's like, well, what it needed is someone like yourself to come in and actually just try and go out and find these retailers to come in there because it would actually be a really cool spot, but right, yeah, and and and it is in terms of how that's just value.
Speaker:So you you you can have, for instance, um Joe Bloggs, who's renting it from you for 100k, and you'll value that offer 10% gross yields would be worth a million quid, but you could get Tesco in there because they've got a strong covenant, they committed for a long period of time, and you know, also paying you 100k, that's gonna be worth 2 million, right? So literally your yield will compress maybe you know from 10 to 5. So it's a good value. But it's safer at that point.
Speaker 2:Yeah, I get it. I'd love to know from you because obviously you've done quite a few deals in your time by the sound of it. What's an example of a deal that you've done that 99% of people would have walked past? And what was the lens that you used to made that so obvious to you?
Speaker:I saw a flat, um it was a two, sorry, three three-bedroom duplex um in Chelsea, which was on the market for uh £800,000 and I eventually managed to secure it for £310,000. And I share that one as your as your as a first answer because so many people would have looked at that and gone £800,000. Okay, that's cheap, but that's not a that's not a deal. And they wouldn't have inquired about it, thought about it, you know, they would have left it. 99% of people would have left it. But every property has a story, every seller has a story and a and a situation. And one of the people often what people don't get their head around when they look at real estate or understand how to invest in real estate and say, well, how do you buy things genuiness under market value? Like surely the fact that you bought it means that that was the market value. And it's not because it's understanding that everyone has the story. So I I understood um why that person was selling, I understood uh the limitations of why it wasn't selling, it had a short, well, not a short lease, it had eight two years, but many people can get mortgages. And ultimately, I understood that that person was in a position where they needed to sell. So they agreed to my um to my offer because it was fast, it was in 24 hours and they'd have the money. And also I understood the fact that they needed the money in 24 hours, and that was you know, that was that was the situation. And so what I what I because we now have you know a number of people who work within our team who are constantly going out finding properties, I have the benefit where I can spend time or my team's time investing time into looking into why that person selling for 800k is selling for 800k, because I know that one in a hundred of those, maybe there is someone who will sell for a significant discount. And so I think that's one thing is understanding that regardless of a price tag, there's always a deal to be done. Every property ultimately gets sold to somebody if they want to sell it. And the question is, why is that person buying it? And how often do you want to just annoy me? I used to drive around London, especially when we did London. I see someone bought a development site that I bid on and didn't I said, how do they get that to work? Now, either they overpaid for it and they've lost some money, which could be why, but it's like everyone ultimately sells. And often what I found was it was timing. It was I was the first person through the door, but had I been the second person through the door, you know, offer it, I offered a 50% discount. But just because I was the first person, I insulted the person. Whereas just because if I'd been the second person, the person would have thought, well, you're the second guy to offer me a 50% discount. So yeah, fine, it must be the price, right? So, so you know, it's timing a lot. And then I think the second thing was um I converted back in 2014 an office building into 24 uh flats through permitted development. And I say that again because uh PD, uh permitted development rights converting commercial into resi had just come in and they were still even working out the legislation. And I think the again being an early move, and I had to be in, you know, in 24 years old, I had to take on additional risk and we had to take advantage of loopholes. And and so again, I think 99% of people, the legislation was too young, too uh too too juvenile to actually take advantage of it. But the moment it was through, we we bought a building and converted it into residential. Um, so again, uh speed in that in that instance, you know, 99% of people wouldn't have bought that because there was too much risk.
Speaker 2:So for someone that's listening to this and perhaps might be buying a house soon, yeah, understand the person you're buying it off as well. And there's some personal questions there you would ask them.
Speaker:Yeah, yeah, yeah. So so I think yeah, bringing back to home ownership, what uh one of the views I like is uh, you know, people open up to estate agents in the most extraordinary way, right? Yeah, I can actually relate, I've just gone through and moved myself.
Speaker 2:Yeah, it tells them everything.
Speaker:Do not say anything. This is a commercial transaction. You're not you're literally like uh, you know, I I I know uh um a colleague who was selling his house and obviously he had the baby monitor on, right? And so they're literally standing here, this couple looking by house, they're like, So do you think we need to come in asking, or do you think we can like offer a bit more? And my friend's literally on the monitor listening to these people talk about how they're gonna how they're how his his wife's father can lend them a bit more money and you know, but increase the price of all this. That's a great strategy.
Speaker 2:Literally just not in a room and leave the monitor, right?
Speaker:Listen to it, yeah. So that's what that's great. But yeah, honestly, people open their hearts and you know, open their hearts up to estate agents whose job it is to sell you the house. And so don't tell them that you know you're about to get a bonus. Don't tell them the fact that your salary's about to increase. Don't tell them the fact that um you thought your budget was, you know, 500k, but it's actually 600,000. You know, it's like you keep your cards close to your chest. Um, we definitely do it, didn't do it what with what we were buying.
Speaker 2:It was more about the selling one because we went for a nightmare and ended up knowing everything about us. But you're right, you're like cut your cars.
Speaker:And actually, I think selling is more important. You know, you start to say to an agent, say, I really need to sell this. Like the banks were closing on my house, you know, like I need to get I need to get out. My business is in trouble, and I just really need the money. The agent's not going, Oh my god, like are you okay? Like, yeah, okay. Well, do you think we should increase the price then? And you know, maybe you get he's saying, right, to the buyer, right? By the way, this guy's on a stress situation, like you should do a deal. Do a deal, yeah. So yeah.
Speaker 2:So those personal questions can come handy for sure.
Speaker:Yeah, look, but I I don't want to confuse people as you said, you know, when you're buying a property, when you buy a property, that's not an investment, it's a lifestyle decision. You might as well buy a hermes bag or something else. It's the same. Absolutely, I completely agree.
Speaker 2:I make content about this all the time, and I love it. And I get absolutely slaughtered by half of the British public.
Speaker:My asset's gone up 20% since I bought it. I'm like, yeah, yeah, that's good. I literally I was with a really experienced friend of mine the other day, and he literally has he's got about uh 25 million pound portfolio. So he's he knows real estate, right? And I said, Yeah, but how's that asset gone up relative to inflation? He's like, Well, no one does that. I'm like, what do you mean no one does that? He said, No, no one adjusts for inflation, otherwise, no one will make any money. I'm like, literally, mate, that's exactly what you should be doing. But I find that so many people literally put their head in the sand because they're just like, but I don't know any different. I don't know how to make money. So if you're telling me I need to beat inflation, right, let alone the CPI, let's say, you know, increase in money supply at 8% per annum, like, how am I gonna do that? People just put their head in the sand saying it doesn't matter because the Joneses, you know, the Joneses house is also suffering, right? So we're all in the same boat, it's fine. But you know, it's like uh yeah, yeah, yeah.
Speaker 2:I've got a question for you that might be slightly left field, and it's just come up in my head because of what you've said. Obviously, you've looked at these commercial opportunities, and you look at commercial opportunities as well as Resi, I'm sure. Yeah, but half the high streets are empty.
Speaker:Yeah.
Speaker 2:What happens there? Because that surely is an opportunity. Half of London's offices are becoming empty. Right. And they we've seen big tower blocks convert into Resi now and and we'll work out ways that they can do that. Yeah, yeah. What's the future of this now for those like empty shops that are boarded up? Big question, bro, big question.
Speaker:Maybe, maybe, maybe uh podcast studios. Uh yeah, I don't know. Like my my hope my hope is that um I look ultimately, someone needs to come up with a more broad solution about how they're going to tackle that issue because high streets aren't just about revenue, they're not about providing for shops, it's community. You know, high streets used to have a pub, you know, they used to have a post office. You know, even my local post office where I live in, you know, is is is um closing down. So it's all shutting down, and that's breaking up community. And the heart of this isn't just the issue with commercial property. The reason why people people don't care about wealth inequality, in my opinion, people don't care the fact that gold price is at an all-time high, people don't care that the stock market's an all-time high. People care about that a house price is at an all-time high.
Speaker 1:Yeah.
Speaker:We have a, you know, um a problem with uh housing inequality, not a general wealth inequality, like generally if you want to go. And so the problem with housing inequality, and especially when it throws fees through to high streets as well and banks closing down and everything, is it causes a breakdown of community, the breakdown of families, and more importantly, that people now need to move away from their parents or move away from their relatives. And so it is a much of a, as I say, a political issue that we need to look at the high streets and say, right, what is the solution to them? How are we gonna make them exciting? How are we gonna drive points of interest? Yeah, and I think that's a a broader, broader question, but that wouldn't be something that I'd be willing to like invest into because I think the chances of them actually like doing something are pretty low. Yeah, yeah.
Speaker 2:So I think I agree, but I just wonder because you see, like some, for example, some of the old banks are being converted and you see quite nice flats going into them and things like that, because they're great locations, thick walls, etc. Yeah, yeah, brilliant for residential property.
Speaker:But I think you can convert it, but to be honest with you, I you know, I think it'd be so strange driving up your old high street and it's just yeah, yeah.
Speaker 2:Uh I think it would be really odd. And you're right, that community aspect is sure.
Speaker:I mean, look, there are opportunities to convert and everything.
Speaker 2:I would love to know from you. You know, you you talk about people getting started with this, you talk about their generational buying opportunity, you talk about this as you know a wealth accumulation tool. And if you're starting just from today, yeah, what is the thing that someone like you know Dave down the pub could really take on and go, okay, I'm happy to go and learn about that. Can that person get started with the likes of Blackstone and BlackRock coming in?
Speaker:Yes, yes, yes, yes, yes, yes, Dave can. Dave, it's possible, believe. Um so it depends on what how old you are, right? I think if you're if you're 20 to 30 years old, basically just use my playbook. Align yourself with, I mean, we I I don't want to use the word mentor. The back in the day we just called a boss. They were called a boss, they're called a manager, they were called someone that you looked up to, right? Yeah, that you could work with and ideally get a job in the sector, in the space that you want to explore and build your knowledge in that sector through a job. So not only do you not have to pay someone 10 grand for a course, right, you can actually be paid to learn. It's an extraordinary idea. So so that's that's that's one thing I think, you know, is that ultimately if you are wanting to get involved into real estate, real estate is a career. It is not something you just like passively do. It is not like the stock market. If you want to get exposure to real estate, you're gonna put in. Five figures, you cannot then just get those five figures out if you make a mistake, you know, your taxes, um, transaction costs, etc. So you can't just go in and out. So if you're going into real estate, you're in, you're making big commitments. So, but if you're oh so the the idea there is align yourself with a mentor, learn with someone, learn a strategy. Um, if you are 20, if you are 30 to 40 or or plus, you know, then I think it is also then looking at some degree of mentorship. Um, I always say that you know, there are three people who get to sit at the table. There's a person with the money, there's the person with the deal, and then there's also the broker. Now, often you sometimes don't need the broker, but a point is that only one person around the table has any money, the person with the money. But everyone else gets paid too. So either be the person bringing the deal or be the broker. Now, if you don't know what a deal looks like because you don't have the knowledge yet, and therefore you don't know how to attract the capital, then you need to learn. But equally in the middle, you can just be the broker. So if you're older or even actually you're younger, you can be the broker. I start off at finance broking. So after you know, I moved out of that job, I set up my own practice basically introducing high net worth to investment opportunities and banks and raising debt and everything, right? So I began to learn what was a deal, not because I was also educated by a mentor, but also because I was raising capital for different types of people. So again, I was a finance broker. So um, you know, the best real estate guys I see have been estate agents, they've been mortgage brokers, they've been finance brokers, they've been whatever. You don't need money. So um I'm not sure that helps everybody, but I think I think broadly speaking, you that what I would say you don't want to do is say, I want to get exposures to real estate. I'm gonna put a silly amount of money that's significant to me into a deal before you have either brokered, before you've started working in life with somebody as a JV or mentorship, or if you're young, um getting a job with somebody. And if you don't want to get a job, um then I I would say that probably real estate might not be for you because it is not you know easy in, easy out. It is a commitment when you make a mistake in real estate, you're with that mistake for five years plus. Yeah, it's full-time, it's a full-time thing.
Speaker 2:You do see it all the time. People obviously buy investment opportunities and get into a few buy to let's and you know they do well and it's supplements their income or allows them to retire earlier, etc. And they went out and they learned the game and they started playing.
Speaker:And it well, a lot of people, well, a lot of people who do that, and if you speak to a lot of people about it, they say, Oh, I bought my first property and you know it made money because it's not difficult to lose money, right? But they didn't make, you know, did they beat inflation, blah, blah, blah, blah, blah. And then they bought their second property and their third property, and then they got really, you know, they got better at it, but they had to buy one, two, or three properties before they got very good at it. But you could also save yourself that money, that time, you know, by uh by learning. Yeah, yeah. I mean, for instance, if I even now, if I go into a sector that I'm not an expert in, I will partner with someone who does data centers, I will partner with someone who does dark kitchens, I will partner with someone who does hotels, you know, because uh yeah, I've been doing it for 15 years and I've had a degree of success in it, but I'm not an expert in those sectors, you know, I'm an expert in my niche of a niche of a niche. So, you know, anyone who's got any uh brains that does a JV, you know.
Speaker 2:And do you have any like resources for people that they can go and look at and start helping them to understand this game if this sounded interested to them?
Speaker:So I I I I I get blamed a lot for this, but at the moment it's our Instagram, you know, it's our short form, you know, 90 seconds, two minutes. But um I am under increasing pressure that we do some sort of YouTube, you know, free education, free courses, stuff like that. Uh all free, but um, yeah, something that people can get into. But but for now, I think um, as I said, it's about aligning yourself with professionals who are doing it. Um, if you want to get exposure.
Speaker 1:Yeah, there is some fantastic people on YouTube talking this game as well.
Speaker 2:And uh, you know, that's how we've learned how to do it. And I think it's just a lot of fun as well. Yeah, I mean, YouTube is just this incredible tool. It really is. Well, this is that wealth at your fingertips. It's now time for you to believe in yourself and go for it if that's what you want to do.
Speaker:Honestly, I believe that there's there's not a wealth gap, there's a knowledge gap. You know, if that person knew everyone that I knew, if they knew all the strategies that I knew, they knew all the uh technical information I knew, there would be no um there'd be no difference between the opportunity that someone has versus versus me. Like you have to other than you. Other than me, right. And I think obviously the the other challenge is that people always try and follow someone who's 20 steps ahead of them, whereas actually really what you want to do is follow the person one step ahead, two steps ahead. And I'm so glad you said that. We we say that all the time.
Speaker 2:It's like yeah, and people don't like learning from that person. Yeah, because they're looking up going, oh, for God's sake, you know.
Speaker:They're too close, exactly. They're too close. There's a bit of jealousy, there's a bit of thing, and actually the moment you just go, you know what? They just look at their lifestyle, look how they live, look how they hold themselves. They're doing something that I'm not doing. So, what are they doing that I'm not doing? And then how do I, you know, rather than doing more, be more, you know, how do I become that person? How do I take on those attributes like gravitas so I can actually do the things that they want to do, not just try and do the things, but be, you know, be more. Absolutely.
Speaker 2:James, I've loved this. Thank you so much. Um, where do we want to send people?
Speaker:To our Instagram, James Gerard.
Speaker 2:Follow me in the cab. Yeah, it's great fun. It's really good fun. I uh I can't wait to like every time your face pops up in your comment. I'm like, yes, what's he got to say today?
Speaker:So my wife's my wife's just getting used to it. We were in the airport and uh uh someone came up to us. Like, mate, mate, is this you? I'm like, yeah, but my wife's just like this is literally surreal. Afterward, we were in um what's what's nuts is we get 2.7 million views a month and half a million of those in London alone. So as a as a as a radius, you know, you go around and you know, most days I'll bump into someone or whatever, and and so the the the strange thing for me is just that my my my wife's just uh like what is this surreal world that I've now been pulled into that uh mate, it's crazy.
Speaker 2:Yeah, I'll tell you a story that yesterday um I left my bag on the train, yeah, and um I had all my clothes in. I was in this big shoot and in this like huge movie studio, it was crazy. And but I had all of the clothes I was wearing for the for the shoot. Oh wow, and I got halfway up King's Cross and York Way, yeah. Um, and then went, oh no, and like ran back. Um, everyone in the station I spoke to was just like basically like, do one, mate. Like, I'm you know, I'm not looking for me, like it's your problem. Yeah, and this one guy just came storming out from nowhere and went, up the game. Really? And he was like, Yeah, and he goes, Oh, I'm the manager. And I was like, Oh, well, so it just so happens I've lost my back. And he marched me up the platform, went back, took me into their like little locker beer, got the bag, gave me the bag, and that wouldn't have happened if he weren't doing content.
Speaker:Thank God, thank God you're doing the content, you lost your back.
Speaker 2:Literally, it was the maddest thing. And I was like, Well, if there was ever a moment to actually have done this, it was that, and I just found it so surreal. And then that guy coming up to you, it's just like you're putting your face on the internet.
Speaker:It's like yeah, and you know, someone asked me what someone messaged me the other day and said, Why are you doing this? And I think honestly, I I I felt the same way about doing this social media stuff that I did when I did that first deal when I was 23, 24. Like, I was I was scared, I had fear. And the moment I identified I was scared and I was fearful, I was like, ah, this is something I gotta do. It's like I digital real estate. Yeah, digital real estate. I mean, this is a new real estate. This is a new digital real estate. Yeah, and it's a land grab.
Speaker 2:Absolutely, and that's why we we we put out 30, 40 pieces of content a day.
Speaker:Yeah, yeah, yeah.
Speaker 2:Like we're going hard and you know, pushing because it's only gonna last so long. And you know, these free platforms to go out to millions of people, yeah. You're making a selfie camera and uh at the back of a cab between 2.7 million people a month. Yeah, yeah. That's how low friction it is.
Speaker:And also, I want to yeah, I want to give a special shout out to also to Dan Dan Priestley because speaking about like learning content and education, I consumed uh I consumed all of his stuff. Key person of influence, key person of influence, everything, you know, 24 assets, uh you know, all this kind of stuff. Yeah. Because I just couldn't get my head around like how does this game work? Like, why is everyone like going on and putting their faces up there and doing all this? Like, what is what is what you know, I'd much rather just do a real estate deal. Um, but then I began to understand, and he kind of educated me through that for his you know, courses, YouTube, you know.
Speaker 2:Um, I think I've consumed everything he's ever done. Yeah, yeah. Something new comes out from him, and I'm like on it in a flash. And just because I'm like, oh, what's he changed his mind about something? Yeah, yeah. You're right. And for you, it's probably open the doors to more capital, or if you walk into the room with Tesco and the the doing the deal, they've seen you on the internet. Yeah, and suddenly it's like, well, I should you know probably take this guy a little bit more seriously because he's he could go out on the internet and say that you know Tesco doesn't do good deals.
Speaker:Well my biggest for actually doing it was actually it would alienate my partners and everything, right? Because I bet it's on the opposite, yeah, yeah. Because you know, people don't want people talking, you know, about what what we're doing and what the game is and blah blah la.
Speaker 2:Yeah. Well they say give away 99% of the source, but do it in a way that's so mumbo jumbo that then they have to come and get it and laid out in a nice way, and and that's that's that's uh like a really interesting way of looking at it. Because we do that, we give away 99.99% of everything we do, and people come to us because we put it in an order for them to follow.
Speaker:Yeah, and they trust us and they want to go deeper, and yeah, happy to and I think that's the big thing, you know, is is that and I've been trying to ask people ask me questions, and the beautiful thing is then I'm spending my time and my my brain power trying to work out how do I provide a solution for somebody. What is the product or service that I can provide that that helps people in in the right way? And I think in terms of like circuitry, you know, in one's life, that's a better place to be where you're trying to share knowledge to help or to serve rather than you know receive. And that's um that's you know that's a process that you know you're doing with your incredible um output from the content that you're creating. Thank you, man. Um and you're just like giving knowledge, and as I said, there's not a wealth gap, there's a knowledge gap. And so you're helping to close that gap. Yeah. Uh people make it. One day at a time. Yeah, yeah, yeah. One one black cat video at a time. Honestly, haven't you doing amazing stuff?
Speaker 2:So thank you very much. And it's been a real pleasure. And uh, I've been looking forward to this one for some time. Oh, really? Thanks very much. Cheers, buddy. Thank you.
