Property Developing Question

princess275

That's pretty funny; you really haven't got a clue about how to invest in property. i think you are one of those "homes under the hammer" veterans who desperately needs to break out into proper investing.

What if i told you that i can send you a surveyors report of a property that got valued by a lender's surveyor at £80K even though the property was purchased at £60,400. You would need to eat more than your hat for that though! But knowing you, you will only come back with some "i know it all" attitude and say that its not possible in theory!

So let me give you another elementary lesson in surveys: If a street full of similar properties are being ,marketed at £100,000 and one of those sellers decides to sell for £50,000 due to unusual circumstances that does not mean that the whole street has to sell their property at £50,000. That one unusual sale does not drag the price of the whole street down. Common sense right?

Now before you say the lender’s surveyors will be expected to price a property at the purchase price, it is completely incorrect to assume that the purchase price is the actual value of the property and that is the value placed on the property. This point completely exposes your lack of knowledge of the property market.

Your homes under the hammer theories that i detect in your responses that is beginning to put a smile on my lips lol! I have no intention of calling you an idiot, you are digging a big hole your self.

I don't mind chuckling at you, but i get concerned that anyone else reading this post doesn't get misdirected in investing based on your poorly researched comments and you lack of property investment knowledge

Doozergirl

I'm sorry, are you answering my questions yet?

I think I've got enough evidence to report you to the Forum Team. Your posting style continues to be irrelevant sales patter littered with a bit of abuse to keep me hooked.

I'm quite happy to have my posts deleted from this thread if it means yours are gone as well.

princess275

Please feel free to report at your will, I wasn’t the one calling peoples comments “Rubbish”. All I have done in the thread is reveal a different way of property investing, but for some odd reason, you ended up with a bee in your bonnet. You start going on about sales patter…da de da. Sales patter or not, you have to agree that there are people who have read/ reading this thread who have been briefly exposed to a different type of investing.

Its fair enough you have a different strategy, but you don’t have to stuff ideas like flipping down my throat. I believe I have answered your questions clear enough and at the same time I feel I have done you a service by giving you information on first hand practical knowledge. Now if you feel offended by that then I can’t do much about that.

Your recent question was also clearly answered. Read my last post and you will discover how a property bought at a discount can still be sold at a higher price as a surveyor does not necessarily have a problem with that.

Doozergirl

No, of course you have not answered the questions.

Of course property can be bought at below market value but that also means it can be sold on immediately as well as held. I am not suggesting anyone take any path at all. If they are investing in property for profit then it must be done based on proper research and genuine affordability; the ability to be able to lose that money; a substantial deposit and a contingency fund. I do not advocate any 'company' doing the homework for you as it takes the responsibilty away from a buyer and therefore leaves them open to manipulation. The basis of a company like the one you have linked to is exactly the same as companies like Instant Access who rely basically on people's laziness. A company such as 'a quick sale' if not buying property themselves would have plenty of 'friendly' cash buyers or those with genuinely quick access to known to them queuing up to buy genuinely discounted property. It's nice though if you can find a mug to pay a lot closer to full value plus a finders fee though, isn't it? You simply transfer the contract from the seller to your own buyer and pocket the cash. It is flipping in it's purest form.

Your failure to reply to genuine questions and concerns and then turn them back on me simply highlights to me that they are not genuine. If you deny that they can be sold straight on then I deny that they are true below market value property deals being offered which undermines your entire business proposition. No one should need a dodgy surveyor to tell me the 'true' value of a property nor pay the added insult of a fee to someone who is obviously taking all the cream off the deal.

Going back somewhat, owning 5 or 6 properties with only a £75k deposit is wreckless whether your intention is to hold or sell. You avoid replying directly to any questions on the potential pitfalls which would actually be the questions asked by a genuinely savvy buyer of one of these properties that you are pimping.

princess275

See this is what is frustrating when replying to your comments. Your knowledge of the property game doesn’t appear to be broad enough to grasp the concept of buying discounted property, but yet you try to give the impression that you are well versed with property investment. I am sorry if I have dented your confidence and dented your 11,000+ post credentials but you will have to accept at some stage that you don’t know everything about the property game and you need to discuss something you are not familiar with as opposed to calling genuine experience “rubbish”..

Let me try to answer your question best I can without missing anything.

You said: “I am again still questioning whether they are genuine deals”

I am willing to give you the benefit of the doubt that there are companies like Inside Track that have put a dark cloud on genuine deals. But that does not mean everyone else should be painted with the same brush. I get genuine deals regularly and its a real shame (I mean that sincerely) to see people like you just don’t understand the concept.

What if I told you that you could send 5 surveyors of your choice for the valuation of one of these deals and you get to buy the property 20% discount from the lowest valuation given? Would that still not the deal genuine? I will go as far as to challenge you in an open public forum to get a deal surveyed by a surveyor of your choice to confirm genuineness.

You have jumped quickly to suggest that I buy from people supplying property surveyed by dodgy surveyors even though I have told you that a buyer should confirm the valuation by an independent surveyor of their choice. What part of that don’t you understand or will you be repeating the same question again? Phew you are real hard work!

You say buying a number of properties is reckless. How is it? It may not suit your strategy but do you know that some of the richest people have made money using that strategy at the right time? Every strategy has pitfalls and its all about managing these pitfalls. I am amazed that you genaralise the whole investment game with such naïve statements that a strategy is “reckless”. Every strategy has its own merit, but its about using the right strategy at the right time.

As far as flipping is concerned, you said:

“If you deny that they can be sold straight on then I deny that they are true below market”

In my opinion they cant be sold because the lending situation is bad and even if someone had the perfect discounted deal and ready to pounce on it, they may not get a mortgage and a flip does not happen. If that happens, it does not mean that there is anything wrong with the valuation, it simply means that he deal cant be done because the lender may have gone belly up!

If it makes you feel better, I am all for flipping and making a quick buck, but I have intentionally not suggested that because I don’t believe its the right thing to do in this market. I get genuine 20%’ers offered to me regularly, now if I could practically re-list them and get a buyer with a mortgage approved and ready to buy quickly then I would be making a killing! But its not that simple anymore and that is what I am trying to get into your head. The market is not geared for it.

Phew..bed time

Doozergirl

Genuine newbies with help to offer are welcome here and embraced. The 11,786 posts that you ridicule were not made purely on the knowledge I had when I arrived here, they have been rounded by the advice given by others who also come here to offer advice and also those who came looking, shared their experiences and the results of those experiences. I've absorbed a lot and I wear it and share it all quite proudly actually because I've gained a huge amount of knowledge that helps me run my own business. Much of it relays the experiences of others that are here or have been and gone - I'm like the little old lady of the board that's watched it all play out as well as bringing my own experiences to try and make it real for people. I don't always explain things very well when I've said something a hundred times before and might appear a bit snotty - I try not to but I do know the post count will make me stand out as someone who has an opinion! There is always someone able to take better time to explain things; I don't profess to get everything right, I listen to those who know better than me and I will let posters know if I'm not sure about something and am just offering personal opinion.

Our conversation will probably be deleted (and hopefully your user ID as well) because you've basically admitted to touting your own business but whilst it is still here I'm happy to carry on...

If you can't sell 20% BMV property at it's apparant value then it isn't a 20% deal of any kind, regardless of you explaining how buying at BMV works. I know how it works but aside from being really rather unethical, I know you're not selling genuine deals because you're telling us you can't actually sell it at the price you're saying it's worth. Regardless of market, every house has a price tag that it would sell for. Even if it's £10 for a mansion, you've got to sell it to me for £8 for what you say you are selling to be true. You can't say the market isn't geared for it.

You're a spammer, you've admitted as such which is all I wanted to expose you as. No ulterior motive, I don't want people sucked in by you.

phlash

princessamy86 wrote: »

Make sure you brush up on your tax liabilities as well, capital gains can really eat into your profit margin. Do you know anything about property?

Sorry but this is mis-leading and I need to jump in here:

You will not be taxed by capital gains.

You are purchasing with the intent of making a profit. This is the same as being a builder. You will be taxed on the profit through income tax, i.e declare on your tax return.

henrik1971

Its taken quite a while to read these posts, but I have to say I'm with Doozergirl on the principle of MV generally.
The house next door to us has been on the market for a year, simply because the buyer wants too much - 140k (encouraged by a supposedly "MV" valuation from his estate agent). He blames the 'state of the market' for the fact he's not had a single viewing. If he had lowered the asking price to 115k, he would get interest, because that would be (IMHO) more like MV. However, he would feel hard done by and that he was selling "below" MV. The truth is, he is deluded as to what the true MV is.
You can extend this point to what Princess said about not being able to sell at MV in the current market. Well, that is a bit of a contradiction in terms. If it was truly MV, it would sell after a reasonable marketing period - say 8-12 weeks.

However, it is conceivable that properties could be selling in isolated instances for below MV. Scenarios could occur where there is an element of compulsion in a sale, such as those people who sell to companies like UK Homebuyers. A seller could also act imprudently, without taking professional advice, but I would think these occurences are rare.

googler

On the question of what constitutes 'market value' -

Not far from me, there's a house where the elderly residents are thought to have moved to a retirment development. The word on the street is that the builder took their house in part-exchange for the newly-built one. Shortly after they moved out, it appeared on the market at around £230,000, and was last publicly priced at £205,000.

On the public record of price (zoopla, ourproperty, etc) the house shows as having sold in July of this year at £240,000, and also a few months later at £200,000. To anyone close by, witnessing the timing etc., the obvious conclusion is that on paper at least, the builders 'bought' the house for £240k as PX and then resold it for £200k, and one would assume this still made them a profit on the deal. To anyone else, they're going to look and say 'Wow, prices have certainly dropped in THAT street'....

To the outsider, what would you think the 'Market Value' of this type of house, on this street, is?

£240,000?
£200,000?

Somewhere inbetween?

---

Even if a herd of surveyors says the 'Market Value' of the house is £240,000, how many of the general public would agree? How many would say £200,000? How many would say somewhere inbetween?

googler

princess275 wrote: »

So let me give you another elementary lesson in surveys: If a street full of similar properties are being ,marketed at £100,000 and one of those sellers decides to sell for £50,000 due to unusual circumstances that does not mean that the whole street has to sell their property at £50,000. That one unusual sale does not drag the price of the whole street down. Common sense right?

Um, yes it does drag the street down. I'd suggest it drags the MV for the that type of house and that street possibly to somewhere between £50 and £100k... once the prices are published on zoopla, ourproperty etc., or someone lets slip that one has sold at £50k and it becomes public knowledge.

It doesn't mean everyone HAS to sell at £50,000, but once the public sees one sale in the street at £50k, and similar houses on the market at £100k, their chances of getting £100k each are toast......

What would you say the MV is in my example above?