And, reassuringly, housing transactions have stayed constant for the last four years at 1.2m per year (with some variation across the country). But thanks to fluctuating house prices and a lack of buyers, there are lots of potential investment opportunities for both established property investors and those just starting out with their property business. Depending in your circumstances, there are different types of property business – you need to find the right one for you. Here are seven tips to help you get started.
A property business can be anything from owning only one or two properties that support a pension plan or a large-scale cash-flow business boasting a rich portfolio of multiple properties.
But, what if you’re cash poor? Don’t worry you can still embark on creating a successful property business. In fact, in some cases, you don’t even have to buy the property yourself. Instead you can act as a property ‘sourcer’ or join a partnership venture—either way, to get to reap the benefits of an investment.
So, if you’re new to property investment market and you’re not sure where to start, here’s a quick run-down of what your options are:
Being a landlord isn’t for everyone. Also, thanks to a recent tax clampdown and the introduction of a 3 percent surcharge in stamp duty, the buy-to-let market has cooled down in recent years. The number of buy-to-let mortgages decreased by 36 percent between 2015 and 2017. Despite this, due to falling house prices, it’s still a good time to pick up a deal, which is great news for newbies.
Here are a few tips to kick-off your buy-to-let business:
If you want to be a property developer, you need to embrace a slightly different mindset than if you were buying to rent. For starters, location is paramount here. As is finding the right seller—so keep them in mind when you’re sourcing potential properties. The aim is to make your money when you buy not when you sell. And, if you’re a cash house buyer, you can move more quickly to secure a deal or pick up a bargain at an auction.
Now, this is a bit different as you’re acting as an intermediary, so you’re not spending your own cash. Property sourcing involves finding properties with potential that you then sell on to investors charging a fee. There are lots of benefits to this approach—it’s a great way to make contacts, build skills in the housing market, you can do it without investing your own money and avoid some risks associated with starting your own business.
Let’s say you don’t have enough money to buy a property. If that’s the case, don’t hang up your business hat immediately. For instance, if you live in a large property already, but don’t need the extra space, you can rent out unused rooms and generate an additional income to supplement your main one or as part of a pension plan.
No rule says you have to fly solo. Paying for a deposit or buying a property outright by yourself can both daunting and risky. Why not shoulder the responsibility with others and embark on a joint venture with other investors?
With more investors, someone else can help manage the portfolios and shoulder the financial responsibility. Also, by combining your resources, you can make your money go further and maximise profits.
If you want to build a successful property business keep the following in mind:
And when you’re no longer an active investor, depending on whether you own your properties outright or have mortgage —this will impact on your tax responsibilities. Also, you can hold onto your portfolio, sell it, split it or restructure it. But, it’s always best to check with an advisor.
Need help to sell a property quickly?
As you’re likely aware, when it comes to the property market, things can change overnight. So, if for whatever reason, you find yourself in a position that you need to sell any of your houses quickly, companies like House Buy Fast can offer you a range of services to help you. For more information go here—