How I Went From Zero To 28 Year Old Property Millionaire: Dan Buchan (Transcript)

Here is the full transcript of Dan Buchan’s talk titled “How I Went From Zero To 28 Year Old Property Millionaire” at TEDxUniversityofYork conference.

In this talk, Dan Buchan discusses his journey from starting with no financial resources to becoming a successful property investor. He emphasizes the misconception that only the wealthy can invest in property, countering it with his own experience and noting that 886 of the Forbes 1,000 wealthiest individuals have invested in property. Dan highlights the accessibility of money in today’s low-interest-rate environment, encouraging people to utilize their savings effectively.

He compares different wealth-building strategies, explaining why property investment is superior due to its multiple income streams, including rental income, capital growth, and leveraging. Dan shares insights from his own company’s success, having sold over £40 million in property and trained thousands in investment, to illustrate the potential of property investment.

He advocates for using other people’s money, such as family investments and crowdfunding, as a feasible way to break into the property market. Ultimately, Dan’s message is a call to action for individuals to reconsider their approach to wealth creation and consider property investment as a viable and lucrative option.

Listen to the audio version here:

TRANSCRIPT:

Can you live on 48 pounds a week? Can you live on 48 pounds a week? Because that’s the average pension payout, of the average pension pot in the UK, after a lifetime of saving. After an entire lifetime of saving.

Now, I don’t say that to scare anyone, I don’t want us to be terrified, but that’s what we could be looking at if we’re left to our own devices. And I say I don’t say that to scare anyone, I want us to take control. And I say I don’t say that to scare anyone, I want us to take control of our financial future.

You see, everyone’s heard that property is a good investment.

And a lot of people don’t know how or why, you know, it is, but as a result they don’t get into it. And what I want to share with you in the next 15 minutes is not just why we should, but why we must do so, to take control of our financial future. For those of you who don’t know me, my name’s Dan Buchan, I’m a business owner, an author, and a property investor. I’m 28 years old, which I get is a weird occupation for a 28-year-old.

Early Life and Ambitions

And, you know, I didn’t start with bags full of money, I started with none, and I hope that by sharing my story with you, a bit of the lessons I’ve learned, and some of the mistakes and screw-ups as well, hopefully sharing that starts something today that’s a spark, to maybe have a look at property in a way you’ve never thought possible before, in a way that’s more accessible before.

And if you were with me seven years ago, I’d be sat in these exact same chairs, exact same chairs you’re sat in right now, taking exams at the University of York. And it’s funny that no matter what exam you take, it’s always the most important one in life. I was brought up in a very middle-class upbringing, my mum’s an accountant, my dad’s an auditor, and for those of you who are familiar with the Inbetweeners, I don’t know if you’ve seen that show, it was very much the setting of my upbringing, that was very much me.

And so I went to do GCSEs and I was told, ‘Son, these are the most important exams in your life.’ And maybe you had this at A-levels, ‘Child, these are the most important exams in your life.’ And then maybe your lecturers at university, maybe there’s some lecturers in the room, have told you ‘these are the most important exams in your life.’ Maybe not first year. And I was brought up with that upbringing and I was taught to make money. I needed to go to school, get good grades and get a job. And 16-year-old me thought that sounds good, you know, let’s just sort of have a go at that.

The Journey Begins

And at 16, I wanted some stuff. I don’t know if you can think about the kind of stuff you wanted when you were 16. If I wanted to make some money, I don’t think we talk about making money enough. And there’s no problem with saying that. And so when I turned 16, I decided to go down to the town centre where I was from in South East London and get a job in a retail store. And I had a vision. It was a very specific vision of what I wanted.

I wanted to be able to buy a car. Because that was going to get me to the top of the cool ladder in my head. Whether it worked or not, I’m not sure. But it wasn’t just any car. It was a Peugeot 206cc convertible. In black. With red leather seats. And I wanted that and £500 worth of River Island clothes. That’s what I needed.

And I had a little spreadsheet and all of that came to £3,600. So I thought, okay, cool, I’ve got my little part-time job. But it wasn’t building up enough, so I needed to get another one. And at 18, I got a job as a mystery shopper. Going into supermarkets and doing that sort of thing. And I started to have money coming in, but it was kind of like holding on to sand. The money was coming in, but it kept slipping through my fingers. And maybe you’ve found that with trying to save up money and stuff like this.

ALSO READ: A Compass for Values: Dr Mandeep Rai (Transcript)

And it was then that I was at a fork in the road. I could either choose to go into education, as I always planned to do and still would continue to do, or I could take a year out and see how much money I could make. I thought, okay, I haven’t achieved my goal yet. I’ll take a year out and see if I can make some money. And still with the same mindset, I used the only time I had available, which was night time. I don’t know if you’ve been in a night-time job, but I got a job in a place called Watts Farm. And if you can imagine, a warehouse-sized refrigerator bigger than this room, that was the place I worked. And it was nine at night till six in the morning.

I would go to this farm at nine at night, running around, finish at six in the morning. I’d then maybe have a nap in the car before starting my retail job at ten, finishing that at four o’clock, maybe having a bit more sleep, because you still needed to sleep, right? And then coming on to, you know, going to the mystery shops and then back at the farm. And this was again and again, every single day.

I didn’t have any time left to make money with. And maybe you’ve seen this cycle. You know, maybe you’ve been in this cycle. And I started to realise that the wealth wasn’t accumulating, and working for other people wasn’t working for me. So I needed to do something different. I needed to rewire my thinking to take control of my financial future. And I did what any self-respecting teenager would do. I went straight to Google.

The Shift in Focus

And I saw that people were making money in stocks and shares. And so I thought, OK, you know, I’ve had a job, and now let’s have a look at stocks and shares. And myself and my business partner, Jamie York, we used the small amount of money we had and we put it into high-risk sort of stocks and shares. And we made quite a bit of money doing it. We made tens of thousands of pounds. And I thought I was a genius. I thought I was really smart. But what do you think happens when a 19-year-old suddenly has some money? Spends it. Disappears, doesn’t it? And I spent it having a really good time. I went to university and I decided to…

I lived within sort of walking distance of the campus, but I still get taxis everywhere. I ended up that I did purchase a car, but it wasn’t the Peugeot, it was a Mercedes instead. And so I bought that. And then I realised that after a time I wanted… I didn’t tell my parents about the Mercedes, because in my head I hadn’t made it yet. So I didn’t tell them and then just decided instead to hide it around the corner when they came up. So they did, and eventually I got caught because I got a parking ticket sent home. So I wasn’t obviously the brightest person.

Realizing the Need for Sustainable Wealth

And I then thought, OK, this money isn’t replacing itself. This money isn’t continuing to come in. So I had to do something again different. I was yet again another fork in the road and had to rewire my thinking. And maybe you’ve had a chance encounter in your life, and for me I had a chance encounter. I realised that there was a chap in my university called Alex, and he was studying politics, philosophy, economics. He was doing the same degree as me at the same university, at this university, and he was a couple of years older. But he was already a property millionaire.

And I thought, wow, how did he do that? And so, again, I was at a decision sort of fork in the road. I was looking at the corporate job that I was lining up, and then I looked at what he had, and I thought, do you know what, I want to try and do that. Again, though, I had to rewire my thinking because I had some conceptions and preconceptions about property, and I needed to challenge those.

The Power of Property Investment

And having now built up a portfolio, I can kind of help with the answers to those because I thought the rich invest in property. Maybe you’ve thought this as well. But then I started to think, what if the rich are wealthy because they invest in property? I can tell you now that of the Forbes 1,000, 886 have made or put their wealth into property. It’s what the asset class of the rich choose to invest in. I also thought that you need to have money to have property, and I’ve spent all of mine. But money’s more accessible now than it ever has been. Interest rates are at a record low.

People need to make use of their money in savings accounts. In studying wealthy people, I’ve come across a chap called Robert Kiyosaki, and he says that every person’s got a money problem. For most people, they don’t have enough. For some people, they’ve got too much. And for those people who’ve got too much, they need to invest it. And helping them invest in property is a way we can do that. And also, can I afford not to do it as well? And we’ll come on to that shortly.

ALSO READ: Most Leaders Don't Even Know the Game They're In: Simon Sinek (Transcript)

Overcoming Self-Doubt

I also thought, ‘Can I do this? Just a little bit of personal belief. Can I do this? Can you do this?’ I realised that more people now are doing this than ever before. For the historians amongst you, there was a landowner’s return in 1883 where all the property in Great Britain and Ireland, half of it was owned by 4,200 people. Today, there are 2.5 million landlords, and a lot of them are just with a few houses. There’s more people doing this now than there ever has been.

So that kind of possibility started to open up for me. And what I want to share with you is why property as an asset class is something that we should get into. And the best way I can think to explain that with the experience I’ve gained is through just showing how I made money through the other ways. In a job, I had a salary coming in. And obviously, for some of you that are employed, maybe you’ve got that too. But what happens if you become ill? What happens if the company stops? The money stops as well, doesn’t it?

Comparing Wealth Strategies

And also, it takes a long time to get a massive growth in that salary. So I thought, okay, that’s cool. What about stocks and shares? Stocks and shares go up over time. They get appreciating capital value. They do. But also, you get a dividend income, so you’re making wealth in two ways there. But I found that it took a lot of expertise to invest in stocks and shares, to choose the right ones and that sort of thing.

And the other thing with stocks and shares is the value can go all the way down to zero. Now, again, with a bit of expertise, maybe you can sort of mitigate that, but I’m sure the people who invested in blue-chip stocks like Kodak thought their investment was safe. And property makes us money in three different ways. So you get the rental income coming in over time, regardless of whether or not you’re there or not. It comes in when you sleep, continuously. It’s really passive if you have a letting agent as well. You get the capital growth over time. Property on average doubles every 10 to 12 years in the UK.

Now, let’s be under no illusion that is not a straight line upwards, and we’re going to look into that in a second. And then you also get the rental growth as well, and this is the one people most often forget, is that rents grow faster than inflation. There’s more and more people needing housing. And so you have three ways there that the property generates you wealth, but when you consider that you can leverage this, it adds kind of a superpower to it. A £25,000 deposit buys a £100,000 house. It starts to blow the other asset classes out of the water, and you can really see why wealthy people choose to invest their money into property.

The Importance of Property Investment

Now, what I’m not saying is don’t get a job. I think that could be terrible advice. But I want this to be the spark that makes us think about property investment as a nest egg for the future, a nest egg that grows itself to continue to protect yourself so you’re not living on £48 a week. And nowadays I’ve built up a property investment company. We’ve sold over £40 million worth of property to hundreds of investors, and I’ve trained thousands of people in property investment. And some of the things I’ve learned and the facts, particularly about capital growth, I feel like I should share with you.

Because property’s growth in the UK is one of the oldest asset classes. In 1086, the Doomsday Book valued all the land in England at £75,000. Who wishes they’d invested then, by the way? Buy all the land in England for £75,000. And what about recently? Because, you know, maybe you plan on living for a thousand years. I hope you do, but a lot of people won’t. And since 1950, the average house price in 1950 was £1,891, just shy of £2,000. Today, it’s £240,000. So that’s in recent times. And people might also say, what about the times during the crash? In Halifax, they valued all the property in the whole UK this time, just shy of £4 trillion.

And this was in 2007, just before the pinnacle of the market went down. Ten years later, that same property, after they’d gone down and up, was worth £6 trillion across the whole of the UK. And this really shows that even the price changes are okay with us. You see, property is like a rollercoaster. The prices do go up, and like a rollercoaster, they do go down. But the only time a rollercoaster is really dangerous is if we get off in the middle of the ride.

ALSO READ: India Needs to Create More Jobs: Krishnamurthy Subramanian (Transcript)

The Necessity of Planning for the Future

So, what I wanted to have a quick look at, just to make sure, because that’s why we should do this, but why we must do this, just to compare what happens if we leave ourselves to our own accord. In the average pension pot in the UK, £61,897, according to The Guardian. And that’s just the people with pensions, by the way, and this is after a lifetime of saving.

So I want you just to kind of project forward in your head and think, you know, what am I going to start doing about this? What am I going to start putting in place? Because if left to our own devices, if £48 a week is kind of the annuity, that’s what could happen.

And on top of that, the pension might go to your spouse when you pass away, but you can’t pass it down, and so that money disappears. With property, if we look at a £100,000 house, we might think, OK, cool, that’s fantastic. We’ll add 4% growth per year, which is very conservative, by the way, but let’s be conservative with the numbers. It makes you £4,000 a year in capital appreciation. It then might make £4,000 a year in net rent to intern, that’s £8,000 a year for that £100,000 house. And that makes you money. It works out to be £21.92 a day, every single day for the lifetime of the investment. So not wait until retirement, it starts now.

Leveraging Compound Interest in Property Investment

And Einstein says that compound interest is the eighth wonder of the world, and with property, you really take advantage of that. You get that for yourself to help grow and protect yourself. So how do we do it?

Again, I want today to be a kind of spark to let you know that property is more accessible than maybe you thought in the past. How is it we can get into it, though? This is how I managed to do it, is invest for using other people’s money. Again, lots of people have funds sat in savings accounts, and they need to make use of that. Maybe it’s time to start talking with friends and family.

Lots of families invest together. You know, they buy maybe one house, and even if you bought one every ten years, that’s still starting that nest egg for your future. And that’s what we want to protect ourselves from. People can save in ISAs and then invest in property when they have enough. I’m not saying that you need to suddenly jump in and dive into this. I actually nearly failed my degree because I got into property full-time. And whilst I’m happy with that now, what I guess I mean is that if you have a job and a stable income, put some money aside, invest in property. It’s also good fun as well.

Embracing Different Avenues of Property Investment

Then you build up that nest egg over time. You can learn to invest as well. So I learned to do it. The vision of my company is to be able to grow the wealth, grow people’s wealth through property investment. I’ve just finished a book called ‘The Property Strategy Guide,’ which helps people do just that. You can have a rent-to-buy scheme, and some people may not know these exist. It’s where you rent a property and incrementally save to purchase the house.

So you do up the house you’re renting, and you benefit from the capital value and appreciation and the improvements you make. And you can also pay someone else to do it via a sourcing service. So there’s a couple of different companies out there that help people invest in property. So there’s plenty of ways that we can get into property, and increasingly companies are letting you invest via crowdfunding. So even if you have small amounts of money, you can get into it now and get a feel and a taste for it.

It’s not for me to say what it is to do with wealth we create. Not everyone wants a Peugeot 206, as much as I wish they did. Not everyone does. But it is for me to give you maybe another avenue and have a look at some property in a way that you haven’t done before. Maybe the way that’s more accessible that you haven’t done before. Because if we do what we’ve always done, we’ll have what we’ve always had. If we do what we’ve always done, we’ll have what we’ve always had. And I don’t want this to be maybe the spark for you to think about putting that in your future so that you can create the wealth that you want to.

You’ve all been amazing, and I’ve been Dan. Thank you.