How To Start Out In Property Investment
One of the best ways that you can make money is through property investment. People will always need homes, and with a growing population, and a shift in the way that people choose to live in recent decades means that the demand for houses does not seem to be slipping.
If you have decided to make money from property, you will need to have a jumping-off point. Getting into the market can be tricky, and you will invariably need to get some capital to start off. Ideally, you will have some money saved up. You may want to partner up with someone else and pool your resources, at least for your first couple of projects. This is an excellent way of starting smaller before reinvesting your profits into bigger, better projects.
Buy At Auction
Buying at auction is one of the best ways to obtain a development property. Often, when a building falls into a state of disrepair, a survey would advise a mortgage broker against offering a loan against it. This makes the property hard to sell on the open market, as it will only suit a cash buyer. By going up for auction, it will make the property a more financially viable option for a developer because it has the potential to sell for much less than it might normally do.
You may ask yourself ‘what is the modern method of auction?’ and you will happily discover that you can now bid online for homes, meaning you can look at buying property across a wider distance and not have to invest too much time into options that inevitably do not pay off.
Work Out Your Project Budget
You will need to have a budget for your development property. The amount that you pay for the property will dictate the amount that you can spend on renovating it. You will want to get a reasonable profit on the home, and to give an indication on the final selling price you should look at listings for similar properties in the area to gauge the value.
Have a look at the big wins that you can make in restoring the property. Do the major jobs that will add the most value first. If the home needs a new roof, start there. If it needs rewiring the most, then this may be a significant area of concern. Working out where your priorities lay is essential when it comes to maximizing the potential value of the home. Remember that you will need to ensure that the house is in a good enough state to pass a survey and be sold by an estate agent.
Who Should Do The Work?
If you can do the work, then this may well save you quite a bit of money. However, if you are not great at DIY, then you should leave well alone and hire a contractor. You may find that your mishaps could cost you dearly and will need repairing by a professional.