Property Development

sosos

Has the current climate put an end to the ability/opportunity to make a living from property development?

There is less dross on TV now showing people buying places to spruce up and sell 4 months later, but do you know of anyone that is still confident that a decent income can be made from it? Not with a get-rich-quick attitude, but with a thoughtful strategy.

Any stories/anecdotes/experiences welcome

googler

One of the main obstacles may be the money-laundering regulations, and possibly the govt's guidance notes, which I'm told suggest that anyone selling a house within 6 mths of buying it should immediately be regarded with suspicion in this regard......

project500

Now is a good time for property development but but be mindful that prices will probably fall again soon as we go deeper into this depression so there will be more bargains to come. Only buy if you have cash and try for a 20% discount (at least) from the asking price.

Doozergirl

We've had our best year this year. It takes time to find the right place - you cannot just look for somewhere that needs a tidy up. That is not property development. You need to think laterally and look constantly. There isn't much competition out there at the auctions I've been to - it mainly seems to be landlord types looking to scrape up something for under guide.

Interesting that on another thread that people are dubious that someone could spend £100k on a house worth £280k presently to make it worth £500k. Houses on big plots are houses with potential. No doubt that you need to find a lot of the money yourself and looking for big margins is a necessity to protect your risk.

JQ.

The problem you may face is that banks won't provide development finance to an in-experienced developer. So they may fund the purchase, but you'll have to fund the development yourself. If you've got the cash that's great because there'll be less competition.

Gwhiz

If you can buy at the right price you can always mae money if you know what you're doing.

GDB2222

Gwhiz wrote: »

If you can buy at the right price you can always mae money if you know what you're doing.

That's undoubtedly true. The question is whether the development adds value beyond the cost of the work being done - including the financing and marketing costs. Otherwise, you might as well just buy low and sell on for more.

It certainly helps with development if you have your own labour force and supervise the work yourself. If you have to employ a contractor, your costs increase a lot.

Entertainer

It's interesting that Doozergirl says that; at the auctions I've seen recently there has been a feeding frenzy of interest, lots going for 35% over guide price and generally poor value.

david29dpo

I stopped at the end of 2007 due to not knowing what the sale price would be. Had to let out the last one i did. However i have just bought a cheap repro, no one at the auction!

googler

Doozergirl wrote: »

We've had our best year this year.

Which translates as what....? Buying, refurbing and selling on how many properties?

Out of how many years? Since 2005? 2000? 1990?

Doozergirl

googler wrote: »

Which translates as what....? Buying, refurbing and selling on how many properties?

Out of how many years? Since 2005? 2000? 1990?

I don't think that's any of your business.