Resilience in times of uncertainty

Platinum Property Partners is continuously improving to ensure franchise partners are equipped to weather any economic storm

Nobody can deny that the current economic climate is challenging for any type of business, regardless of sector or whether it is based on a tried and tested franchise model.

In property, there has certainly been many positives coming out of the last 12 months for landlords.

According to the Goodlord Rental Index for September 2022, rents have gone up more than 13 per cent year on year, with house prices still rising, despite the rate of growth starting to slow.

However, the rate of inflation has already surpassed the average buy-to-let yield of 5.5 per cent and with the Bank of England base rate now 2.25 per cent, and with further rises on the horizon, the cost of investing in and managing a property portfolio is higher than it has been in decades.

Thriving through the challenges

But at Platinum Property Partners (PPP), the world’s first property investment franchise, ever-changing market conditions are nothing new. Since being established in 2007, when the BoE base rate was actually 5.5 per cent, the franchise has weathered several storms, including a financial crisis, increased legislation and changes to the way rental income is taxed on property.

Yet, its 400+ franchise partners have continued to build highly profitable property portfolios, and this is down to the robust and dynamic structure of the successful model.

Protecting portfolio profitS

PPP’s high-quality houses in multiple occupation (HMOs) generate up to four times as much rental income per property compared to single tenancy buy-to-let.

These significant margins act as a buffer against the ever-changing running costs of a property portfolio whilst providing much-needed and affordable accommodation to tenants.

Of course, the impact of the rising cost of living and running a property business has not been without its challenges, but the franchise’s in-house experts are continuously refining and adapting the model and training to ensure franchise partners are adequately equipped to deal with whatever is thrown at them.

This year, energy efficiency training has been introduced, which helps franchise partners to reduce the carbon footprint of their properties and businesses overall while ensuring energy bills remain as low as possible.

The model has also already been stress-tested against high borrowing rates and the franchise’s expert HMO mortgage brokers are now helping franchise partners re-evaluate their products and forward plan for the future.

Both training initiatives mean the proven property investment model will continue to generate upwards of 10 per cent return on investment.

High demand in the cost of living crisis

The demand for premium shared housing has always been high, as a growing mobile workforce seeks more flexible and affordable rental options.

However, with research showing that the rising cost of living is now sadly making housing costs unaffordable for 20 per cent of tenants, PPP has seen a stark increase in tenant demand.

Compared to renting a one-bedroom flat plus bills, renting an all-inclusive room in a professional HMO remains more than 50 per cent cheaper and ensures transparency with just one bill.

The combination of strong tenant demand and almost double the return on investment offered by other buy-to-let properties means the PPP model offers a level of certainty in uncertain times.

As of the end of 2021, the PPP franchise had collectively generated £237m in rental income and achieved £43 million in capital growth since the franchise was founded.

At a glance

Established:

2007

Number of franchised outlets:

400+ for all time

Location of units:

184 across England and Wales

Investment range:

£175,000+

Minimum required capital:

£175,000

Contact:

info@platinumpropertypartners.co.uk; 01202 652 100