Are you a buyer? Looking for renovation projects? When it comes to measuring up potential projects, keep these tips in mind:
1. Do the Maths
The first thing you want to do is do the maths. Property developing is very risky. Remember, you can lose everything or you can make a fortune. Figure out stuff such as, how much properties are selling for in the region, how much searches and fees will be, as well as how much you’ll pay in stamp duty.
After you have done the maths, figure out your prospective market or who you’ll sell to. Determine what your profit margin will be. When it comes to property development, things are very capital intensive. Let’s face it, if it was easy to do and risk free, then we would all be wealthy property developers.
2. Keep an Eye on the Housing Market
You can get the upper hand by keeping tabs on the housing market. The market depends on a few things, such as interest rates and employment. Others include inflation, demand and supply, as well as the feel good factor.
3. Remember Location Is a Myth
We all think we know what location, location, location means, but we really don’t. Expect to pay high prices for properties in the centre of the best areas. However, you can still make a good amount of profit, if you play your cards right.
A good location lays somewhere in an area that might not be too good, but has potential. When it comes to selling a property, important factors include being near schools, green areas and public transportation. Being on the best street with the smartest postcode is not really that important.
4. Research the Best Ways to Add Value
Before starting any plans to update and upgrade your investment property, research the things which really need doing. For example, a new tap where a perfectly serviceable, quality one exists, isn’t likely to add value to your home. However, ensuring properties are damp-free and well ventilated is key – buyers are on the lookout for any signs of damp! Make sure you know all the upgrades worth doing, for example, are you au fait with window trickle vents and the best quality bathroom fans?
5. Find the Right Seller
The right seller is the person who needs to sell more than you need to buy. Motivated sellers are a goldmine because they tend to want to sell their properties fast. Generally speaking, those who are going through a divorce are ideal sellers.
People who are in difficult financial situations tend to be motivated sellers. So are people who are about to move abroad or families that have someone who has recently passed away. Such people want to make fast sales.
6. Make Cash When You Buy
Make cash when you purchase a property and not when you sell it. This means the property needs to be bought at the right price. Every pound you can knock off the price of the property, the more money will go into your pocket. It doesn’t matter how good an investment it is, you don’t want to pay too much for a property.
Keep an eye out for properties that have planning applications lodged with the local council or authority. If you put in a good offer, you might have a chance of getting the property. This takes work, but it is worth it.
7. Pay Below Market Price
You want to come out on top or without losing your investment when the market experiences a downturn. This is why you need to do what you can to protect yourself against any major changes in the economy. A lot of people say you don’t regret deals you don’t do, and those who say that are right.
Remember, better deals are always around the corner. Take your time when it comes to shopping around for property because if you rush into buying property, then you could regret it. Doing that can result in you losing a lot of money.
8. Buy at Auction
If you want to find great deals, then consider buying at auction. Just don’t let your emotions get the better of you, otherwise you run the risk of paying too much for a property! Remember, auctions are a lot like poker, which means you want to see what others are betting before you decide to throw in your bet.
9. Target Your Ideal Buyers
Consider who you are trying to sell to once you buy your property. Is your ideal market students because if so, then you’ll want to steer clear of buying high quality fittings. If professionals are your targeted market, then they probably will have more discernible taste in finishes.
Are families going to be your target market? If so, then consider the decor. These are all things you want to take into consideration.