What is deal packaging? And how to do it:
Forth Action Invest on September 14, 2022
Are you looking to delve into the property world and wondering what is deal packaging?Â
Whether that means living the luxury lifestyle you often dream about or simply creating a better life for your family, having a profitable portfolio could be a great way to turn these visions into reality.
Or maybe you’re keen to share your passion for property and want to learn more about deal packaging…well, we’ve got you covered!
Deal packaging is one of the easiest ways to delve into the industry head first, as much of the stress is taken off you as the process and tricky aspects are dealt with by professionals.Â
But if you’re looking to have a go yourself, here’s the ultimate guide on deal packaging…
*Please note this blog does not constitute investment advice. Conducting your own due diligence and being aware of risks before making any investment is key. Seeking independent financial advice may be appropriate.
What is deal packaging?
This is a service where investors are introduced to property deals. Deal packagers are often the ‘middle man’ and help secure great deals you may not otherwise find.
The manual work of finding and securing a great deal is completed by the deal sourcer and packager.
How to start deal packaging
Are you interested in getting into property sourcing? It’s a great industry where networking is key.
Before getting into the relevant skills, there are some legal aspects you should check off before you begin with your deal packaging business. Once these are covered, you can start building your network!
If you’re looking for an experienced deal packager or property sourcer UK, find out more about Forth Action Invest here.
What you’ll need to start deal packaging
It’s no secret that the world of property investing in the UK can be a lucrative industry (there are risks to all aspects of investing.) While you may have found the perfect investor, there are always some checks to be done before going ahead with a new buyer.
It’s estimated that up to £6.7bn of suspicious funds have been invested in UK property since 2016. As a deal packager, each investor must be checked in the initial stages to ensure this isn’t the case.
This is where anti-money laundering training comes into play. This is a must-have for all deal packagers. During this training, you’ll learn which checks to do and any suspicious signs to watch out for.
All property agents, deal sourcers and packagers must also register with the Property Redress Scheme. This provides an impartial and independent service to customers, allowing them to escalate a complaint where needed. There’s a legal responsibility to belong to a redress scheme.
All landlords, estate agents or property agents must register with the Information Commissioner’s Office (ICO). There’s a fee under current data protection laws, with a civil penalty of up to £4,350 applicable for those who don’t pay the required amount.
And finally, as with many other businesses, it’s advised to have professional indemnity insurance and public liability. This will cover claims made against your business.
It seems like a lengthy process, but it’s worth going through each step in close detail as there are real legal ramifications if you’re not registered with the relevant schemes or have the required training.
What skills you need to source property and become a deal sourcer
Property deal packaging can be difficult when you’re first starting. This is because networking plays a large part in the industry.
If you’re offering deals within a certain area, you must have an in-depth knowledge of the location to advise your clients or potential buyers best.
With strong skills in networking, you can build connections with anyone in the immediate area and beyond. Individuals or companies within your network may just alert you to a great opportunity, or they may have a buyer that’s a perfect match.Â
Although you may have a network building up around you, it’s vital you have an eye for a good deal!
The property industry moves quickly, especially in 2022, so you must be able to spot the deal that your potential buyers will be interested in. This requires a deeper understanding of what investors are looking for.
Knowledge of the current market, trends and a range of investment opportunities will put you in good stead for securing a much-desired deal.
Other necessary skills include top-notch communication, time management, flexibility and organisation.Â
How to package a property deal
As a property agent that offers deal packaging, you’ll have to gain as much knowledge as possible within your investors’ chosen area.Â
This research involves:
- Demographics for the area; population, crime rates, areas of growing interest
- House prices: What are the current market rates? How have the prices changed over the last few years?Â
- Are there any tenants in the area currently?
- What type of investment opportunity would be most suitable?
Once you feel confident with the knowledge, it’s time to find what people are looking for.Â
You’ll have competition so be prepared to act quickly but always keep in mind what your target audience are actually searching for.Â
Gaining a lead on a property before it goes to market can be an indicator of a good deal.Â
And don’t be afraid to reach out to others too. Some property sourcers may have a lead they can’t follow up on or maybe it’s not in the location they typically operate in. In these cases, they often pass on the potential property to others who are more suited.
After you’ve found a property
At this stage, it will all be dependent on your potential buyers.Â
This is where you can closely analyse their needs to create a deal suited for them.Â
This should include their chosen investment opportunity style and the best price and offer.Â
Also, think about what they require from a deal packaging service. What elements are they looking for? Or are they looking for everything to be taken care of throughout the whole journey, including the maintenance and running of the property after? Is that something you’d be willing to assist with after the contracts have been signed?
Create a deal package that people are interested in, one where they can have as much involvement or as little as they’d like.
How to get started with your own property journey…
There’s no denying that deal packaging can be an overwhelming process – whether you’re a seasoned professional or a newbie to the industry.Â
It takes skill, experience and practice to perfect each package. If you’re looking for someone to take the reins or assist with your property investing journey, a turnkey approach may be the best option for you.
At Forth Action Invest, our complete turnkey service means you can invest in UK property without much of the stress.
We’ll manage every aspect of the process, from property sourcing to renovation to tenant matching and ongoing portfolio management.Â
You can rest easy knowing your investments are dealt with by professionals. Through years of dedicated property sourcing and various investment services, we’ve helped investors and developers all over the world to level up.Â
Discover more about our services here to unlock investment opportunities.
*Please note this blog does not constitute investment advice. Conducting your own due diligence and being aware of risks before making any investment is key. Seeking independent financial advice may be appropriate.