Property Investment Tips For the Beginner
No matter the state of the economy, with a wise investment strategy there is money to be made investing in commercial and residential property. Here are some suggestions to help get you started on the right and safe track.
Most property investors start off working from their local area. Why? Quite simply, you have local knowledge which is a requisite for any kind of property investment.
Knowing your local market will help guide you as to which kinds of property are in demand, what geographical areas are best, and where the most potential tenants will be. Along with local knowledge, work from a position of comfort and control. That means if you have specific knowledge of office space demand, or small industrial units, or as a home owner the demands of residential property, start off in those areas.
When seeking out property to buy, find buyers that are in need to sell. I didn't want to use the word "desperate", because people who are desperate to sell are also often the ones you have to be most careful about (the more desperate, the more likely to omit information). Properties that have been on the market for many months, or over a year, are always a good bet. Companies that are downsizing again are good to deal with.
Once you have found some properties, the next stage is to do your in depth research. Check that what you believe to be the facts are the facts. Get builders to give you quotes on any refurbishments. As you get nearer to making a decision, more in depth research by surveyors and lawyers would be wise. Keep in your mind your strategy. If you are planning to rent the property what work needs to be done to make it meet any regulations. In an ideal world, you want the least amount of expenditure combined with the fastest returns. A property that you can buy, give a lick of paint, and then rent out fast is the ideal.
The faster you can turn round your property, obviously the better. So make sure that you have everything in place. The last thing you want to discover is that your builder can't work on your building for three months because of other commitments and you have to use a more expensive builder. Getting your property rented out fast is part of the plan - stick to it, even if you have to pitch in yourself.
Don't try and do everything yourself. Estate agents will often know of property not on the market yet. Develop good relations with them and get advance notice. Similarly, once you've found a good builder, electrician etc, keep them! Finding good workmen will make your life easier and more profitable.
Even if you haven't got the complete purchase price of a property, even in today's marketplace you can find lenders. There are provisos though: excellent credit ratings; 20% deposit; a sound business plan. Remember though, the bigger the deposit, the better for you in the long term. And there is nothing to stop you flipping properties as the market improves to increase your portfolio using the profits.
Study your local area, study the market, and follow a plan. Sound simple, but it takes dedication and discipline. With those, you could build yourself a nice little empire over the next few years.
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