Over the past thirty years, there has been a rise in the amount of people who buy residential property as an investment rather than to live in themselves. The property boom meant that houses and apartments that could be either developed to sell on for profit, or kept as a rental portfolio, were a smart way to invest money and make an income that was steady and ongoing. Today there are more small time property developers than ever before, particularly as there are less state owned properties available for rent and housing associations continue to grow stronger.
But becoming a property developer with a real estate portfolio is not without risks and you should not go into it lightly. Programmes on TV like ‘Homes Under the Hammer‘ show that lots of people go in with the right intentions and then buy a property at an auction, only to then find lots of hidden costs, issues with the property and all their projected profit eaten away with the cost of getting the property saleable.
But that doesn’t mean that you shouldn’t look into this, property developing and creating your own property portfolio can be extremely lucrative, you only have to look Ron Legrand Net Worth to see that if you do it properly, you can make a fortune. Ron’s story is well worth looking at as it had it’s peaks and troth’s and shows some of the things you need to be aware of along the route of real estate.
What should you look at?
What you are buying is key. It is best to buy the worst house in the best street than vice versa. You can then make adjustments to the property, and, if you have bought it at the right price, you should be sure to make a profit. A stunning house in a not so lucrative area will probably be at its ceiling price when you buy it, and even adding a swimming pool would not change that.
Be Careful At Auction
It is very easy to get carried away at auctions, lost in the moment, you continue to bid long past when you were planning to stop. DONT! Have your limit in your head, and if it goes past, leave it to someone else and look elsewhere. You had you maximum price for a reason and shouldn’t break it due to auction fever.
Get a Survey
Whatever other things you decide to skip in order to save money, a survey should not be one of them. A survey can highlight many issues, from any mines in the garden, problems with the roof or foundations, dry rot, rising damp and any structural issues that could need lots of money spent on them.
You also need to be careful if a property is nationally, or locally listed. This would mean any renovations would have to stay faithful to the original property and can cost a lot more money and time, not good if you are trying to get your property ready within a short time frame.
Do your Homework
What did the last property in the street sell for. Is the property good for local schools, does it have good local amenities, or transport links. All these things could make a property more attractive, and give you a better chance of selling for profit, or getting a long tern tenant for rent.