Flipping on off plan property

molit

I was wondering what peoples thoughts are on flipping - where you buy a property off plan, and then sell it on before completion.

It strikes me as a way where you could make some money, but I guess the risks are:
if you cant sell, you either loose the money you've put in, or end up with a place to rent out you didnt want to cover a mortgage you didnt want.

If you do sell, you might not get back what you put in.

I'd welcome poeples thoughts on this, as I've heard of it before, but dont know anyone who does this.

xycom1

You see it all the time - brand new houses/flats coming onto the market and it looks well dodgy.

Personally, I wouldn't pay more for one of these flats than it was originally sold by the builder/developer and would offer well under the new price - but I am sure there will be plenty of mugs that will line your pockets.

sanfrancisco

You missed the boat...people were doing this during the boom very successfully.

With certain building societies now not lending on new builds because they believe they are overvalued, I would say that the risks are considerable.

tomstickland

It does depend on a rising market.

molit

Thanks for the replies, I am not looking in the UK, I was thinking in bulgaria possibly - where there is a rising market - when it happenend in the UK, did people actually make money out of it, or were the profits which were made over hyped?

sanfrancisco

look on nethouseprices for any large city centre flat development and you will spot flippersandcanjudge for yourself.

sashacat

I did it at the height of the boom a few years ago and made quite a bit. I would sell on the day of completion and use my buyer's funds to buy the property..so I didn't have to draw down my mortgage. I did have to pay capital gains tax. I wouldn't do it now in the uk as the market is not right. also it is more difficult to sell an off plan contract ie where you have paid you deposit and exchanged contracts,as potential buyer's have nothing to look at and nothing to lose by waiting until the place is built. I ,personally, wouldn't buy in Bulgaria anyway but good luck

meanmachine_2

Flipping eck! the flippers are back out in force! Must be the effects of that fragrant spring bounce.

Listen, to make money you have to take risks, so good luck to you. But with a glut of new builds in the UK, you'd have to be certifiable to attempt it here.

Bulgaria - I haven't the foggiest. What's the demend for luxury two-bedders there? Probably not great.

Also, I just find the whole practice utterly contemptible. But that's just me. I see property as a scarce basic need. That's why the easy money in property passed me by. Ah well.