How Adriana Cafasso Switched from Law to Building a Multi-Million Pound Property Business

Property can look straightforward from the outside. Find a deal, add value, refinance, repeat. But anyone who’s actually building a business in this market knows it’s rarely that simple.

In this episode, I sit down with Adriana Cafasso, an investor operating in the North East who’s scaling both her own portfolio and a high-volume, end-to-end investment business. She’s not watching from the sidelines - she’s actively acquiring, refurbishing and structuring HMO and mixed-use projects in a market that’s becoming more competitive and more regulated by the month.

We talk about how she moved from law into property during lockdown, the early setback that could easily have knocked her out of the game, and what changed in her approach as she moved from “trying to do a deal” to building a proper operation with the right partners and systems around her.

This is a practical conversation about execution, decision-making and staying consistent when results don’t come overnight.

🎯 What You’ll Learn

• What it really takes to build and scale an HMO business in 2026
• The hard lessons Adriana learned from an early deal that went wrong
• Why consistency and visibility can create opportunities before you feel “ready”
• What “good sourcing” looks like (and why most deal packs aren’t good enough)
• The key ingredients of a strong HMO deal: cash flow, capital recycle, and location fundamentals
• What Adriana is seeing on the ground in the North East and how she’s adapting to the market

If you’re building or planning to build a HMO portfolio in today’s environment, this episode offers a realistic perspective from someone actively doing the work.

💻 Resources & Mentions

• Join Andy’s Accelerator Programme: If you’d like my direct input on your current or next project, you can book a complimentary strategy call with me here.
• The HMO Roadmap: Feeling overwhelmed? Access 400+ tools, templates, and lessons to help you start, scale, and systemise your HMO business - all in one place. Join here.
• Facebook Community: Got questions or need support? Come and connect with 10,000+ investors inside The HMO Community here.
• Social: Follow me on Instagram for daily HMO tips, advice, and behind-the-scenes updates here.

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Transcript

[00:00:00] Andy Graham: Hey, I'm Andy and you're listening to the HMO Podcast. Over 10 years ago, I set myself the challenge of building my own property portfolio, and what began as a short-term investment plan soon became a long-term commitment to change the way young people live together. I've now built several successful businesses. I've raised millions of pounds of investment, and I've managed thousands of tenants. Join me and some very special guests to discover the tips, tricks, and hacks, the ups and the downs, the best practice. And everything else you need to know to start, scale and systemise your very own HMO portfolio now.

[00:00:40] Andy Graham: today's episode is gonna be a good one because I'm joined by someone who is very much in the trenches of building a property business. I'm sitting down with Adriana Cafasso for a grounded and very honest conversation about what it really takes to invest in HMOs and build a property business. At scale in 2026, we're gonna discuss the realities behind Adriana's strategy, staying consistent when things as you are about to find, don't go to plan, and the lessons that only come from the real world execution of doing all of this.

[00:01:08] Andy Graham: We're gonna talk mindset, momentum, strategy, and all the habits that actually move the needle in this game. So whether you're just getting started or have a few properties under your belt already, there'll be plenty to take from today's episode. Let's get into it.

[00:01:24] Hey guys. It's Andy here. We are gonna be getting back to the podcast in just a moment, but before we do, I wanna tell you very quickly about the HMO roadmap. Now, if you are serious about replacing your income, or perhaps you've already got the HMO portfolio that you want to scale up, then the HMO roadmap really is your one stop shop.

[00:01:40] Andy Graham: Inside the roadmap, you'll find a full 60 lesson course delivered by me teaching you how to find more deals, how to fund more deals, and raise private finance, how to refurbish great properties, how to fill them with great tenants that stay for longer, and how to manage your properties and tenants for the future.

[00:01:50] Andy Graham: We've also got guest workshops added every single month. We've got new videos added every single week about all sorts of topics. We've got downloadable resources, cheat sheets, and swipe files to help you. We've got case studies from guests and community members who are doing incredible projects that you can learn from.

[00:02:05] Andy Graham: And we've also built an application just for you that allows you to appraise and evaluate your deals, stack them side by side and track the key metrics that are most important to you. To find out more, head to theHMOroadmap.co.uk now, and come and join our incredible community of HMO property investors.

[00:02:33] Andy Graham: Hi Adriana. Welcome to the podcast. I've been looking forward to this chat because you are somebody who is most certainly. In the business and keeping very busy. You are up in the northeast, you are very busy. You're investing in all sorts of things, and you're sharing a lot of this on social media as well.

[00:02:44] Andy Graham: We've also worked with some of the same people, some of my clients that I help build businesses. I know that you've been helping them as well, so I was particularly interested in, in getting you on the show today. So what I'd like to do is just dig into your journey so far. What's going on, what's working, what's not? What your sort of insights into this industry are and how the market is sort of, in your opinion, performing. So Adriana, for anyone who's perhaps not come across you yet, can you tell us a little bit about yourself, about what you're doing in property, what's going on, and where you're based?

[00:03:19] Adriana Cafasso: Yeah, absolutely. Firstly, thank you very much for having me on today. So yeah, I am Adriana. I'm based in the Northeast, so Newcastle and surrounding areas, and I basically specialise in building out portfolios for myself, but also for clients as well. And we've essentially built out an end-to-end system. To allow people to invest from all different experiences, but pretty much focus down the buying in the northeast, renovating it, and then going for the high cash flow strategy on the backend. So whether that's commercial, HMO, and avenues like that really.

[00:03:55] Andy Graham: And as well as doing a lot of client work. You've also been building your own portfolio, haven't you, Adrian? Mm-hmm. Which I've gotta say is really, really impressive. Certainly given the top, top of time you've been doing this. So just tell us a little bit about what you've been able to then build for yourself alongside your sort, I suppose, your client facing business.

[00:04:13] Adriana Cafasso: Yeah, so this has kind of happened over the last few years really from starting without having a capital had to build to that point. But essentially how I've built the portfolio is starting with flats. Doing just kind of an easy, simple project like that. Then moved that through to a mixed used HMO, so six beds and the commercial, the numbers on that were pretty good. I think we pulled out everything plus another 60 K, which then fed into the next project, which is a nine bed, HMO. And another six bed. And then once we're currently wrapping the brother of wrapping all that up, it's just kind of onboarding the next one. So it's been very HMO dominant, but based on Article four HMOs.Standard area ones and then just kind of moving through and then scaling up from there. Really.

[00:05:00] Andy Graham: Fantastic. Very exciting. And I've gotta say, and in fact, just give us a little bit more context. Tell us a little bit about just some of the client projects you're doing as well. 'cause I perhaps know a little bit more about that than our listeners will. Yeah. But, 'cause I've been working with some people, like I said, that have been working with you, but some of these projects that you've been helping people with and helping the investors buy have also been really quite fantastic. And not necessarily the smallest projects either.

[00:05:24] Adriana Cafasso: Yeah, absolutely. So we do a lot of volume, but I think some of kind of the standout projects, so last year we had about 30 projects moving through under construction, but some of the ones I know that we've both spoke about have been 18 bed conversions. So we picked it up article four for 365K. We spent 270k on it, and then we revalued at 1.14. Revalued it, 1.14. So it was a full equity release. Basically made it into, splits it into two, run it as two eight bed, all en suite HMOs with a separate unit on the back, so 17 rooms in total, and then that will rent out for 122,000 pound per year. So it was a really good way to kind of. I guess build a full salary around one property investment.

[00:06:13] Andy Graham: Absolutely. Well, yeah, I mean these are not small numbers. I think it would probably be useful to make sure that our listeners know that you are based in the Northeast and, 'cause I know a lot of our listeners listen and sort of, depending on where you're based. It can be more challenging to get these sorts of numbers out of the deals, and I know that firsthand, but you are obviously based up in the northeast working very hard to add this value, recycle it, recycle it out. And what I think what's also really impressive alongside the numbers is just the sheer volume that you are doing.

[00:06:41] Andy Graham: I've ran a business like yours, a Adriana. We had a very good, I suppose what I would've called it was an end-to-end turnkey service. Worked with high net worth individuals. We would go out and acquire assets for them. We'd do all of the work. We'd then manage them. And it's very, very labor intensive. It's a very, yeah, very hard work. And I don't want for one second anybody to think that this is easy because we make it sound easy on the show. It's a challenge, isn't it, managing all of these different parts. And I wanna talk a little bit more about that today. But look, to begin with, I'm really interested in how you got here because I know that you ended up in the Northeast, 'cause you actually went up there to study law. So tell us a little bit about what happened and what kind of forced that change from law into property.

[00:07:26] Adriana Cafasso: Yeah, I feel like I came up here to study law and that's kind of always been the plan, have the backup, have the option. I got through university, I did it. I did the studying, but it was never kind of, I did well, I got the two one, I think it was like a mark off a first, so I did really well, but it was never kind of a career that I was like. Wow, this is exciting. Me. What's my next step? I'm gonna get the training contract and I would have done it, like had my route planned out, as it should have when I graduated, as soon as I graduated, we were in lockdown already. So it was moving straight back home, which kind of derailed my plans to go and doing my M law, which is like my integrated masters to go and traveling, which was kind of like a natural progression.

[00:08:10] Adriana Cafasso: You do, you go to uni, you go traveling, you come back, get your training contract and then you build up. So I guess in a way that was kind of a blessing. I went back home. Traveling plans derailed and kind of then had to figure out what my next step would look like. I think sort of in my last year of university, I started to tap into my entrepreneurial side a little bit more.

[00:08:29] Adriana Cafasso: I was at Northumbria and it was really good for Santander Enterprise Weekend, so you'd go in, you'd build a business, you'd pitch it, you'd present it. They did a lot of like female entrepreneurship courses, so it was kind of like dipping my toe and like, oh, I really enjoy this side of things. My mind can work for that.

[00:08:47] Adriana Cafasso: Creatively, I'm pretty good at. Setting myself a challenge and sitting down and doing it. I think to kind of build a business, you need to be very good at being strict on yourself and putting yourself under that pressure. So I kind of started to get into all that kind of thing. And then obviously COVID happened.

[00:09:04] Adriana Cafasso: I started up a business more or less a day after, handed in my final dissertation and started like a small customized issue business. Sold them through Instagram. Made sort of 10, 15 grand. But I also was working full-time during lockdown in marketing, but it was kind of classed as a emergency role. So I was very, very busy during lockdown, which, but I also couldn't go and spend any money.

[00:09:27] Adriana Cafasso: So I was able to kind of save up that part. And I think I just realized at that point I can do something, whether that be. Going and buying a house and living in it and starting my property journey that way, or do I kind of start to look down the educational route. And that was obviously a massive part of lockdown people doing all these extra bits, building a different career path.

[00:09:48] Adriana Cafasso: And so I think I just kind of stumbled upon it. I'd moved back home and then moved back to Newcastle. 'cause I was able to kind of support that from the shoe business. And then I basically had this like 10, 15 K mark and I thought, right, I'm gonna invest that. And granted, yeah, it was a massive sum of money.

[00:10:08] Adriana Cafasso: My position enabled me to do that. I was young, I mess it all, but there's money. It doesn't work out is only me to blame. So it was just kind of a case of starting from scratch really, and just figuring out what that looked like. But I think. I knew my passion wasn't in more, which is basically the starting point of it, and I kind of wanted to figure out what that would be.

[00:10:28] Andy Graham: You've said some really interesting things there and You mentioned that you started to maybe see your entrepreneurial side and it's funny because similar to yourself, I went to university, did the academic thing, actually. Mm-hmm. Spent more time in it than I should have. You're far more intelligent than me realizing much earlier on than it probably wasn't quite right for you. I kind of stuck, it took me about six or seven years till I really did kind of realize I, I started. With my property stuff. Yeah. Almost immediately, but I didn't realize that that was where my future was until several years later, but

[00:10:59] Andy Graham: It took me quite some time to figure out that there was that entrepreneurial thing to me, and it's weird because I just don't think that there was anything around me or I don't think my environment in any way helped sort of me discover that while I was going through my academics and it just took kind of Going out to the big wild world and doing things and maybe getting frustrated and whatever. Just to learn that. And when I did, it got so much more enjoyable. 'cause I started to think very, very differently. Obviously you've now been nurturing that, so you kind of went to study, Lloyd did all of that, obviously COVID threw you a few curve balls, and then you ended up kind of moving into the property thing. What was the first deal that you actually did, Adriana?

[00:11:39] Adriana Cafasso: I think the first one I did was the rent to rent over this accommodation. I've spoke about this quite a bit. It just did not work for me. It wasn't for me. I was so caught up on having to do a deal and having to make the money that I kind of jumped in. I did one as a joint venture and that was fine, but I was managing it, but that's not me. Service, accommodation management, that side of things. I'm a much more kind of practical boots on the ground. That's why I love the development side of things.

[00:12:08] Adriana Cafasso: It was that area, and I jumped in. I said, take my money. I'll refurb your full property. I'll do all of this. I was sleeping in the property for like two weeks. There was no hot water, but I was like, it's right in the city center of Manchester. Why would there be any problems with this? And because I was so desperate to get that first deal, I didn't.

[00:12:28] Adriana Cafasso: Ask, and everybody knew what I was doing, but I didn't like sign on the dotted line to say, oh yeah, this is serviced accommodation, does the building permit for it. And everybody knew of what I was doing, but then as soon as we started to launch it. The building manager was like, oh no, we've changed your locks. You can't do it. And the landlord had a really bad reputation and he basically just changed the locks, took my 10 grand's worth of furniture and refurbed. That was the end of that.

[00:12:59] Andy Graham: Wow. Well that was not the story I was expecting you to tell. I thought the first deal, you probably did it and it went really well, and you took this gamble and well you did, but it, it just didn't Well, so you went from this sort of high of trying this, pursuing this new passion to all of a sudden doing a deal that didn't work out. So what next? What did that first 12 months look like?

[00:13:16] Adriana Cafasso: Do you know what? My first 12 months was really, really difficult, like, and I think that's, in a way it's good, but at my first, I learned a lot of lessons in my first 12 months, like. I feel like the way I am, I was able to kind of say as soon as I started, I didn't technically have much, I didn't have anything going on when I first started property, but you can guarantee that every single day I would be sat down at a laptop with a list of things to do and I'd be working it like a full-time job.

[00:13:45] Adriana Cafasso: I've always been quite good. I've been able to just sit down and, and, and get through what I need to. So I was seeing deals all the time, but I didn't really know, like I wasn't sure how to price up, so I was meeting builders and pricing up jobs, but I was kind of. I was really nervous to put that first deal out there and actually make it work and put it to an investor and do it because I didn't have the capital to invest myself.

[00:14:06] Adriana Cafasso: So I had to go down the route of sourcing it and doing it that way. But all I could offer at the start was a source I couldn't project manage I, I couldn't do all that side of it. So I kind of started with lower risk opportunities, but those first 12 months were really hard. It was a lot of rejection, a lot of figuring out what I could.

[00:14:21] Adriana Cafasso: And couldn't do. But what I also did a lot of, and I think it set me up for, to build that trust was in smaller circles. I was making people know who I was. So I was quite confident to put myself out there. And maybe it was, yes, with lower level investors, but I was putting myself out there. I was turning up to the events.

[00:14:40] Adriana Cafasso: I'd put myself forward. I put myself on social media and I think. Just doing that, it gave me a little bit of a foundation so people started to understand who I was and what I was doing as a business. But I had a lot of financial setbacks in my first 12 months and it literally came to a point where, 'cause I went into it full-time, but full-time when you're not technically making a lot of money, it is kind of hard to say.

[00:15:03] Adriana Cafasso: So I think after that kind of first 12 months, I was probably maybe a month away. From saying, this is it, I need to go and get a job. I dunno if this is working. And then I started to get my first deals coming through and selling the kind of projects and even that first investment that went wrong because I put that all over my social media, doing the work, doing the refurb, doing the numbers.

[00:15:23] Adriana Cafasso: It built up a lot of trust in people that I was active and I was actually like confident to do it. So I do think even though I lost money, it's probably built me a pretty solid foundation to start out with. And then the resilience to come back again. Sometimes that can be enough to put people off forever.

[00:15:43] Adriana Cafasso: I just sort of realize that that's not quite my bag. I need to kind of switch up and I need real, tangible assets that I can buy and iron or the people I'm. Invest in their capital four. They own it. That's theirs. And we've got all the right regs around it. So it was just kind of a pivot point after we figured out this is business, things go wrong, things change, and it's how you pivot and kind of move on from that.

[00:16:06] Andy Graham: Well, I mean, thank you for sharing such a sort of an honest record of that. And do you know what, again, I can completely relate. It's very difficult and it's a very steep learning curve. And that's the reality. And actually I think talking about it on the show, we've got lots and lots of listeners. I think for a lot of people I'll be listening in and thinking, oh. I'm glad to hear it's not just me, then it's really, really difficult and the learning curve is very steep, very fast, and like you said, it can be very, very expensive as well.

[00:16:30] Andy Graham: I'm a a bit older now and I've got nearly 20 years of experience behind me, and, and I think one of the things that I have definitely figured out is that it's these really difficult moments and these times in business where things are not going to plan and you find a way of making it work.You learn so much more from that. And I think good business is actually all about what you do when things are not working. It's really quite easy when things are working, when everyone does what you want and everything comes in on time and on budget and the money comes in. But when it's not, the question is what are you gonna do about it?

[00:17:02] Andy Graham: And it's these. Experiences that I think really shape that. But property, it can be forgiving long term, but in the short term it can be quite unforgiving because everything is so expensive. So tell us Adrianna, how you got from there. That kind of difficult first year in property to where we are now, because there's a big leap from

[00:17:23] Andy Graham: Over that time period. And in just a short space of time. So what happened? What changed? What did you do differently?

[00:17:30] Adriana Cafasso: Yeah. I stepped back and I think that's one thing that I always tell people if it's not working, it's about pivoting and figuring out what you actually enjoy. I think there's so much pressure on the property business to follow the trend and what the trend is.

[00:17:44] Adriana Cafasso: And yes, I own in the HMO space, that is a trend. That's where a lot of people wanna go and invest. But that works for me. It's something that I'm interested in. It's something that I personally invest in. So I understand a lot of the intricacies of it, and I think. That is where it pivoted for me. So I still had to keep the service base because I was building up my capital.

[00:18:06] Adriana Cafasso: But how that then changed was, okay, well, we don't just need to find something and give it to someone. You need to start to build out an end-to-end service. I'm based in the North East, so a lot of my clients are from the south or further outside of Newcastle. They need somebody that can not only. Find an investment and run the numbers, but can guide that through valuations and solicitors and all the legalities around that and through planning.

[00:18:32] Adriana Cafasso: And then somebody that can actually deliver the build and that understands the regulations and then again, on the backend that can deal with the rental. So that kind of built up and up and up over the years that we would source it. And then it went into project management. But I think the biggest thing for me in business is understanding the benefit of partnerships and, and having the right people to work with.

[00:18:51] Adriana Cafasso: So how it kind of transpired to where we are now is myself and James. We met our business partner Michael about three years ago now. He was in the building side of things, so he had a lot of experience on the construction side. We were really good at obviously pulling in sites and getting ourselves out there that way, and we kind of had all the different power teams and we realized, you know, if we do this together, we are kind of hitting all angles.

[00:19:17] Adriana Cafasso: So it's, although a lot of people just see me, there's obviously my other two business partners behind the scene as well, and we essentially figured out we can deal with this partnership in the right way and everybody has their specific roles. We're gonna get a lot further and an answer that I don't have, somebody else will have.

[00:19:32] Adriana Cafasso: I always feel I respect as a person when somebody says to me, I don't have that information, but let me get it for you, rather than kind of fluffing around it. So that's essentially what we were building. We're building a core team of people and that means a pretty much. My architect, I use one architect more or less across everything.

[00:19:50] Adriana Cafasso: I use one broker across everything. Work with a few lenders that we know, understand our product. Obviously the one build team, and we've just then built out, we've brought everything in house and then built out the teams around that. So we run. All our lads through the construction company, meaning that we can, well, we understand the product, we know exactly what's going in, we understand the quality of the build.

[00:20:13] Adriana Cafasso: And yes, it's very, very difficult, very labor intensive, but we know who is responsible to keep delivering, and I think that's kind of how it's built and scaled. It's just by building that core team of people up.

[00:20:25] Andy Graham: Well, I couldn't agree more. I think those partnerships and those key relationships.It doesn't matter what business you're in, they're so important. They're such enabling factors. And I think, again, especially in this business with so many different moving parts.I can really understand the importance of that to you. And, and then, so I understand you are essentially bringing clients from the south Up towards Newcastle. And that was largely because a lot of the work that you were doing in terms of just profiling yourself, sharing what you were doing. Is that right?

[00:20:54] Adriana Cafasso: Yeah, absolutely. Yeah. Big southern base of clients. Some even some local, some local clients as well, but I think the northern market tends to excite investors a lot more. At the minute, particularly

[00:21:05] Andy Graham: for obvious sort of yield based reasons, right? But I think what you've described there is something that I try and encourage a lot of people to do, especially those clients who are building their own portfolios, but recognize that they haven't got the resources to deliver everything that they want. They're gonna have to go out and raise money, find more money, do more, be a bit more creative. These early years where you're just figuring things out and are not necessarily the expert you'd like to eventually be. I think there's such a great opportunities to just share with the world what you are doing.

[00:21:40] Andy Graham: Very honestly, very openly, very transparently, and you know, you don't need to pretend to be an absolute expert at anything. You just need to be you and I see so many people wasting that opportunity. What I say to people is that all this work that you're doing now. Finding deals, viewing stuff, analyzing stuff, doing your first project, tendering things out, dealing with these challenges, getting your head around the legislation or whatever it is.

[00:22:03] Andy Graham: All of this stuff is great. Material that you can share to tell people a little bit more about what it is that you are doing. And that might not help today, might not reel anybody in or any great opportunity tomorrow, but it might do later in the year. It might do next year. It might do in a few years time, and it all just starts from sewing that first seed.

[00:22:22] Andy Graham: But it's just making that work that you're doing now work so much harder. A lot of people in my experience, they wait. Until they think things are going really well, they look great, and then they start doing that work, and then there's a big lag because all of a sudden they haven't got the resources, the capital, the partnerships that they need, and then there's this big gap they've gotta go and then work really hard to figure that out.

[00:22:44] Andy Graham: And of course, they haven't got much going on to demonstrate their credibility and stuff like that. Yeah. So I think the way that you've described it is exactly how I would encourage people to go and try and make things happen themselves. You've talked quite a lot about sourcing Adriana, and obviously that's been a really key part of your business and still is. I hear a lot of people talking about sourcing. I see a lot of stuff come across my desk regularly, and some of it really kind of just makes me squirm. Tell us in your opinion, what is. Good sourcing. What do good deals look like? What do you put in front of your clients that perhaps we're not seeing other people in the industry do?

[00:23:20] Adriana Cafasso: Yeah, I think it's something that we see massively now because of kind of our outreach on social media. You know, I get past opportunities all the time, and it's usually all about what their fee is, not about what the investment's actually gonna bring in return. To me, I see it as. I've built myself a full-time job. I've got my portfolio as a separate thing, and that's gonna take care of me when I need it to. But right now I've built a full-time job. So what that means is I need to be analyzing these investments as if I'm gonna buy them. So I need to be doing my different scenarios. I need to look at how it's gonna be financed, I need to work my cost backwards, and it's That's something that, you know, that's what we've built as a business so that our investors, whether you are highly experienced, which we deal a lot with a lot of repeat clients building up portfolios, or if they need to invest in, you need to be able to walk through all the pros and cons of an opportunity and set that out exactly as it should be.

[00:24:12] Adriana Cafasso: I think only then you can cut sort of justify that as a service in a business. A lead is very different to an actual stacked up investment. So we're pretty kind of strict on what that looks like and where our numbers need to be and pre-vet in everything. If I give you an opportunity and say, oh, it's gonna be worth 500,000 pounds, and we get a preval and it's worth 200 grand, there's a problem.

[00:24:34] Adriana Cafasso: So are you prepared to fix that and you're gonna find them something else? Are we gonna work that out? It's all the kind of everything else service base that goes around it and kind of working that through that. I think. Is gonna build you up a credible sourcing business. But also I think where we've been able to scale is because it's not just a sourcing. We're a construction company, we're a letting agency. We're all of the above. So people come to us to know that, okay, these guys can take care of every aspect of my investment portfolio and working long term with a client to say, okay, you need to hit this financial goal in this time. So work that backwards at the capital that you have to then arrive at The investment plan.

[00:25:14] Andy Graham: Hmm. I think hearing you say that really until it looks like something you'd invest in, it's not something that you would share. It's kind of music to my ears because a lot of the stuff that we do see flinging around emails and social media is just stuff that has been poorly thought through. Nobody's really considered the contingency measures. Nobody's really actually kind of done any work on actually justifying much of what's there and, and actually doesn't take. Very long if you start picking at those holes to see there's very little beneath them.

[00:25:44] Andy Graham: Tell me then what you consider a good deal to look like. Adriana, what if something sort of came up on the market or across your desk? What gets you excited in terms of a deal?

[00:25:54] Adriana Cafasso: Yeah, so our main thing is always gonna be about how much capital we're pulling back out at the end of the investment against the cash flow. So typically we're working with anything that's sort of Depending how it's funded, if you're funded as much as you possibly can, that's sort of 25% return and above is what we tend to work with as investments in Newcastle. Different kind of things we're investing in at the minute that's getting us excited is I like commercial opportunities. I like the commercial leases that you can get on the property, but also building that mix use we're doing at the minute I'm buying kind of.

[00:26:25] Adriana Cafasso: Run down existing HMOs where I can go and do small cosmetic uplifts, but still increase the value quite drastically from the rent. Relatively like easy in and out projects, but I think because our focus is always on maximizing that cash flow and the money out, it tends to sort of lean towards multi-units and HMOs. But as a caveat to that. Location. Location is everything. And you'll know there's obviously a lot with the HMO space, particularly the tenant type and the people that you're getting in the property and considering that is a massive factor as well.

[00:27:00] Andy Graham: It is. I still think the single most important factor, I've always thought there are three good components to a deal. There's the location. Which is the bit that you can't change. Yeah. Once you've committed, once you've bought, that's it. There's the rents, the kind of the price that you can get, but that's a bit more flexible. You can either move that up or down. Mm-hmm. Depending on what you need to do. And then there's the spec, which again, to an extent you can change.

[00:27:23] Andy Graham: So two of these components you can change. You might need to spend a bit more to maybe do that, but that location piece you have to get right from the outset. And I've seen people make some decisions based on what they think might happen or what might happen around it over the next few years. And often that takes longer or doesn't quite wash through in the way that people think.

[00:27:43] Andy Graham: Yeah, it's almost like hiring when you want to hire people, generally speaking. Best way to guarantee you're gonna get what you need is to hire on experience. Well, it's the same with property. If you just invest in the right location, yeah. There's a very good chance that you will get exactly what you need from that deal because that data to support that demand is there, isn't it?

[00:27:59] Adriana Cafasso: Exactly. Exactly. That's the thing. And I think a lot of, so. All of our investment areas. We have an investment property in there personally as well. So I'm pretty niche in terms of the specific locations that we invest in the Northeast. It's a huge, huge area. It's very vast. There's lots of, it's different to London. There's lots of areas that it just doesn't work for. It's not gonna happen. So I think it's really important, and I say that with a lot of my clients, like if you are investing from the self, you might be able to go up here and pick up a house to 70 grand. Just because it's huge doesn't mean you're then gonna get the right tenants and it's gonna work out that way.

[00:28:37] Andy Graham: I think that that is such sage advice. It's so alluring, this idea of these higher yields, and I have this conversation so often, but the reality is it is a big place. There's lots of places around the Northeast that you probably wouldn't want to own. Real estate. Mm-hmm. Um, there's a reason that yields are very, very high. Like that is a very real thing. Without the experience of maybe having done a HMO Yeah. Or even the experience of having managed the whole project end to end or even managed the lifecycle of a HMO, you'd like a 5, 10, 15 year period. It's very difficult to know what these things really will actually behave like in reality. So I think working with the right people or. Investing the time to properly understand what's happening on a local level. Literally getting on the streets. I tell everybody that they should be doing this. If you're gonna do it yourself, you need to be on the streets. You need to know the good streets and the bad streets.

[00:29:28] Andy Graham: You need to know what's going on. Where are people getting the bus? Where do people work? How many people, all of that stuff. It's so, it's so important, but it's also so very easy to be misguided on that, get it completely wrong. And then of course, it's very difficult to reverse out of a deal that you spent a lot of money on. Maybe commercializing, maybe doesn't now suit being a normal residential property. That's definitely not the position we wanna wanna end up with. 

[00:29:52] Adriana Cafasso: No definitely not. Definitely not.

[00:29:54] Andy Graham: Let's look ahead, Adriana. I'm interested to get your opinion on what you think, first of all. The market looks like. How is it behaving? What are you seeing? What are you feeling on the ground? And then I'd like to have a discussion about the future.

[00:30:07] Adriana Cafasso: Yeah. I'll be honest, I think at the minute. It's getting harder to pull the right stock in. We're kind of in that place at the minute where prices are rising and it's, you have to then figure out where you're gonna be at the end. Obviously, materials refurbs are going up and purchase price are increasing, so it's definitely harder. To pick up stock at the rate we were doing on the market. So we're kind of having to go down different routes. I think as the year comes on and as rent reform comes in, I do think we'll see more and more coming up.

[00:30:38] Adriana Cafasso: I know I work a lot with portfolio landlords, so I'm typically buying stuff that they've owned. It's ran. It doesn't look very good. They want out because they know them. Houses aren't gonna meet the requirements that they need to. So I think it's about positioning yourself in front of those people and not typically in your traditional Online right move always. So yeah, we're definitely finding that there's not as much stock available for the prices that we were picking it up for. So that's definitely trickier. But I think if you can position yourself as a strong buyer and typically find the landlords that have got loads of stock, that's where we've kind of been able to keep that volume moving where we see things going.

[00:31:18] Adriana Cafasso: I think it will have to eventually kind of turn positive, and I think you just have to work with the market. So with the way that. Renters are going, I think you must make sure you've got that professional team there. Self-managing or just having it with any agent for the fees. I think you need to make sure you've got someone there that's hitting all the compliance.

[00:31:36] Adriana Cafasso: They're working with their own legal team. They're ahead of it before you are, I think is really, really key. Article four is a massive thing that we're seeing at the minute that's so much prejudice in the market against HMOs. For someone like myself that does a lot of that, we pride ourselves on delivering a really high quality, and we are the exact opposite of what a lot of the media press is saying that HMOs are.

[00:32:01] Adriana Cafasso: I think you have to start future proofing these assets and making sure that you're getting the security you need before you jump into these investments and the right planning and working around all that. So I think you need to be up to date. Constantly, don't just think about the regulations. We're seeing things change really quick and really overnight in certain areas. So that's kind of where I see things at the minute. It's about, yeah, wits.

[00:32:25] Andy Graham: I had a similar conversation yesterday actually with a few people, and the similar narrative about HMOs was shared. It's like turning an oil tanker around, I think trying to change opinions on HMOs or, I mean, there's landlords and then there's HMO landlords, and even then there's quite a big cap, and we are like right at the bottom.

[00:32:43] Adriana Cafasso: Yeah,

[00:32:44] Andy Graham: but I think you're right. I do think that with all of the additional legislation with the fact, like the honest fact that it is harder to get the same return, I mean, property's not isolated in that sense. There's very little things that we can look at around us now that seem better value for money.

[00:33:02] Andy Graham: The same chocolate bar, it's a little bit smaller and it costs a bit more, like, it's kind of the same with property. But I think the big question is, well, what else are you gonna do? And if you still want to be in property, if you're still passionate about it. And I think you and I still absolutely believe that it's a great asset class. And I do think that it's becoming more, and what I keep banging on about this, it's the kind of, certainly the theme of the year so far, but I think. Professionalizing the industry. That's definitely kind of the trajectory from governments and local governments. I think anybody wanting to do this sort of stuff part-time, one foot in, one foot out, not really take it seriously, is possibly gonna get burned.

[00:33:38] Andy Graham: Mm-hmm. I think people who take it seriously, and it doesn't mean they need to do it on a massive scale, but it does mean they perhaps need to, if they're gonna invest further away, employ services of people like yourself who really do understand what's going on, who they can actually guarantee. They're gonna get it right.

[00:33:52] Andy Graham: They're gonna do it in the right way. The income, the asset's, all gonna work. I do think that that's becoming increasingly important. I think gone are the days where you could just kind of pick a place on the map, go and buy a property. It would kind of work. You probably are, or almost certainly make money.

[00:34:08] Andy Graham: Mm-hmm. And then maybe sell it in five to 10 years time and make a load more on the capital appreciation. I think that that has definitely changed. You've gotta be much more intelligent now about making all of this work. 

Adriana, it's been an absolute pleasure talking to you today. Tell us a little bit more about where people can perhaps come find out more about your services. If they were interested in maybe coming to invest in the Northeast, maybe talking to you about your services, how can they best contact you?

[00:34:33] Adriana Cafasso: Yeah, absolutely. I think two of the main ways to kind of get a bit of a more of a overarching idea about what we do would be LinkedIn, which is just Adriano Cafasso or Instagram, and the same thing. We post quite a lot of content on there, and then if you guys just reach out, you'll be put through a funnel and we'll be able to jump on a Zoom call and discuss the different opportunities.

[00:34:53] Andy Graham: Brilliant. Well, Adriana, thank you so much for coming on today. I really appreciate you taking the time. I've really enjoyed this conversation and sharing the insights about this industry with you, especially around I think, what it actually looks like and means to build and grow your own business. It's not. Easy, but it, no, it can be incredibly rewarding.

[00:35:13] Andy Graham: and I think you've been really honest about your journey, which is what I love about the show. Just having those very honest conversations, keeping it super real, and I think you've just done that. I know a lot of our listeners will take a huge amount of value from today's episode.

[00:35:24] Adriana Cafasso: Perfect.

[00:35:25] Andy Graham: So thank you for coming on, and I'm certainly looking forward to seeing a lot more about what you do as you move your business forwards.

[00:35:31] Adriana Cafasso: Amazing. Thank you so much. I've really enjoyed it.

[00:35:41] Andy Graham: That's it for today's episode. Gang, thank you for tuning in. Big thank you to Adriana for coming on and sharing her experience and insight. These are the great conversations I enjoy. Really valuable, grounded in experience, focused on how decisions are actually made in practice and what running a property business is really all about.

[00:35:56] Andy Graham: If you found today's episode useful, please make sure you are subscribed and please, please, please leave a quick review of the show. It helps us more than you could possibly know. It helps us continue to bring great guests like Adriana on the show and it helps continue to spread the message and change the narrative about HMOs and if listening today has highlighted a need for perhaps more clarity or structure in your HMO business, head over to theHMOroadmap.co.uk. Now, go check out the HMO roadmap yourself. See what it's all about. Get yourself enrolled and take advantage of everything that we've got to offer, or if you really want to accelerate your results.

[00:36:30] Andy Graham: That is exactly what my accelerator program is designed to do. So if you wanna find out more about working directly with me, head over to the show notes now. There's a link there and a video you can watch and you can book yourself a strategy call to discuss how I might be able to help you. That's it guys. Thanks again for listening and don't forget that I'll be right back here in the very same place next week. So please join me then for another installment of the HMO Podcast.