Property investment is a tough business. Get it right and you can be very profitable, however get it wrong and the results can have severe consequences on your finances. Many beginners underestimate the time, money, effort and research it takes in order to be a successful property developer. To help give you a better idea of what to expect when joining this industry, here are five things you should know before investing in property…
- Buying a cheap property to develop can be very profitable, however it takes time to develop property, so take into consideration that the market may have fallen by the time you come to sell or let your investment.
- You can manage the development of your property yourself or you can pay someone else to do it. Where possible, try to combine your own skills with professional tradespeople to get your project completed. Mistakes will eat into your budget and delay your building schedule. If you do choose to get help. be sure to find reliable builders.
- It is important to remember that developing a property is very different to buying something that you will be living in yourself. Remember to make your design decisions based on your buyers profile and not on your own personal taste. Try to create an affordable ‘blank canvas’ for your buyer, to allow them to make the property their own. This means a simple and clean design with all the essential appliances.
- Another significant factor in property development is identifying your target buyer or tenant. This is helpful to know before you start your property search. Identifying the best investment property for your target tenant will help you to achieve a successful investment. This is particularly important if you a looking to target a specific sector such as students. For example, student accommodation needs to be close to a university and have good transport links.
- A final consideration when investing in property to-let is unreliable tenants. Tenants can cause many problems for landlords. They can get behind on their payments or they can cause damage to the property. The good news is that with a bit of planning, a thorough screening process and the right insurance, this risk can be greatly reduced.
Categorised in: News
This post was written by Dennis Adam