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  • Tips

    Here are some tips I would like to share with the first time property developers.

    1. Get a team together. Have someone reliable and trustworthy who isn't going to rip you off. Ideally having your own team full time would save money if you went big with property development and then get them on other jobs when you aren't developing property.

    2. Research into the property, don't buy the house without either seeing it or at least reviewing the legal documents. Obviously a survey should be done on the structural side. A house which cost 86k was reduced to 84k after haggling over it needing a rewire. However it wasn't until the sale went through woodworm was discovered.

    3. Have a secondary income, at least if you are left with a house at the end which even though it couldn't sell and you didn't make a few thousand pounds you still have a house which can be rented and make up to 10% annual yield.

    4. Mortgages these days are almost non existent. So if you do have the cash especially when it comes to auctions more money can be made especially if it's a buy to let.

    5. Lastly. Don't expect to be the next Donald Trump. Yes people make millions but that is through years of building a property portfolio which can be 100k's in rent and millions pre tax profit on sales. But Donald Trump nearly lost it all in the 1990's and many who got greedy lost it all in the recession. So leave an exit plan at least if you buy and do up 3 houses a year and say made 50k and then bought a property did it up for 45k and rented with a 10% annual yield then you have made 5k in development and £4,500 in rent. Ok so it doesn't sound exciting but multiply that several times and it does and don't forget in the end you can always sell the property. I didn't take expenses such as taxes into account for the above figures.
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