Welcome to part 8 of the house deposit challenge where the ultimate goal is to build up a suitable house deposit within 24 months to finally get onto the property ladder. We’re now over 30% through the challenge and August has seen things ramp up significantly after big decisions were made after the last update.
If this is the first report you’ve stumbled across then feel free to view the previous instalments to get a better feel of the overall challenge.
Why am I publishing this journey?
The main reason for making this public is for accountability. It’s easy to stop saving when no one’s watching. But this provides me with saving discipline that I’ve been lacking for many years. I’m sure if most of us look back over the last 5 years we probably could have saved a substantial amount even if we were only saving a few hundred pounds each month.
There’s nothing inherently special about my saving or money-making methods which are shown throughout the updates. However, with focus and a clear goal hopefully you can do the same too!
In last months edition, I decided to sell my two passive affiliate marketing assets for a much-needed cash boost into the savings pot. As things stood they were profitable each month but after mapping out the challenge period it wouldn’t be enough. I also doubt my ability to scale the site above £1,000 a month which would be needed to hit the overall target.
After much deliberation, I decided to sell both.
Site 1 – Sleep Site
This is site has fluctuated in monthly profit each month. However, it had a huge amount of potential for an experienced site builder to overhaul the site as it had a very strong content base and powerful links that I’d built over several years.
This site was listed on Flippa.com which brings buyers and sellers together to buy online properties including content and eCommerce sites. I was fairly open to how much I’d accept for this site so I started it at $99 with no reserve. Very bold, but the listing was for 30 days so I felt it would get enough attention to find the right buyers who would compete for the site.
Site 2 – Outdoor site
This site was the property that was on the strongest trajectory but I felt I’d taken it as far as it could go. I also wasn’t particularly passionate about the topic so it could do much better with a stronger team behind it.
Due to the stronger revenue numbers, this allowed me to sell it on a more specialist site selling service, motioninvest.com. With this, came a longer due diligence process which required me to provide access to an array of details including Google Analytics to verify traffic, affiliate platforms to verify revenue and all my personal details for added protection.
After around 10 days or so they came back with an offer. The 8-month profit average (November 2020 to July 2021) was $208 (USD).
Using their marketplace option allowed me to list the website for a higher multiple than if we were to buy outright. The site was listed for $7,700 and was operated in a “dutch auction” style where we reduce the price by $97 every 2 days until it sells or reaches $6,240. Websites often move quite quickly on the marketplace, though there are no guarantees it allows an opportunity to secure a higher price point. So I agreed with this approach.
Two very different selling approaches for both sites.
Obviously, due to the auction type with no reserve, this had me slightly more nervous about getting the final price. It also required me to field all the questions from potential buyers that aren’t required through Motion Invest. This made it quite a time-intensive sale however after seeing an initial flurry of bids, a buyer request to purchase the site for $4,000 which I accepted in an instant.
Due to being an American based platform, it made it slightly more difficult to buy a UK based domain site. Several offers were made under the asking price and I turned these down as I was confident they would sell for the full price.
Standing my ground seemed to work as the site ended up selling for $7215, which equates to $5772 after fees.
In total after fees and conversions, both sites brought in a total of £6,705.
Investment Balance – £14,346 (+£5,522)
The investment account saw a healthy bump once the site sale balance had cleared and a large proportion then reinvested into my current portfolio which also saw some nice gains throughout the month.
Savings Balance – £5,001
I’ve also been building regular savings throughout the year. I’d always recommend diversification of not only your earning sources but also your investment/saving sources.
This was previously not included in past updates due to it being my overall emergency fund where I am fortunate to be able to add between £800-£1200 each month. If we get to the end of the challenge, then it can most definitely be used as part of the deposit. This also makes up the last affiliate payment that I’d receive from the sold sites.
I’d also expect this to drop slightly in September as I always tend to be slightly over aggressive with how much I put into savings.
This month I benefited from cutting back on going out. Also, received my previous tenancy deposit back which has also added to the balance as well as some outstanding unused holiday pay that I cashed in. I would never recommend doing this in normal circumstances because we all need to rest. But for this, it’s necessary.
Total House Deposit Balance: £19,347 (+£10,524)
This will of course be an outlier of a month as I don’t expect to add this level regularly. Especially because now I’ve let go of the main passive income assets that I have. The main goal for the rest of 2021 is to build up different types of money-making assets.
I’m just over 48% of the way towards the total target with 33% of the challenge elapsed so I’m happy with the ground that I’ve made. Especially nearing Q4 where outgoings always tend to rise.
The required monthly savings rate for the remainder of the challenge has now dropped to £1290 for the next 16 months.