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tlh858

There are 2 kinds of property developers.
Those who do the job properly, and those who do little more than a slapover with a few gallons of emulsion paint.

Those who make real money do the former.
What you are suggesting is the latter.

While there is nothing wrong with saving money where possible, attempting to do up a house with the cheapest materials will just mean you have a poor quality, cheap mess at the end, which will be worth little or nothing more than you have paid for it.

If you rent it out, all of those cheap things will break within a year and need to be replaced.
If you attempt to sell it, the agent and all of the prospective buyers will see all of the cheap tat in there, and either not buy, or might offer a substantially lower price if you are lucky.

As for some of the other questions and suggestions, here are some which are the truth:

Laminate flooring is the most unsuitable product for any house. No sensible developer would ever use it.

Rewiring a house takes far more than some cable rods and pliers. If you haven't done any rewiring before, forget it. It's all very well having it inspected afterwards, but what happens when the inspection reveals a list of defects which is the length of a toilet roll?
The same applies to plumbing and central heating. There are regulations which have to be complied with.

If a property is being refurbished properly, it will be impossible to live in it while the work is being done.

Building regulations applies to virtually everything in and around a property. You can't change this.
If you were intending to submit a building notice for the various works, forget it. They are intended for use by professionals who are fully versed in all of the regulations and how to implement them.

You can't take your waste to the local tip for free. Sooner or later they will find out what you are doing, and you will then have to pay to dispose of it properly just like everyone else. Disposal of waste is expensive.

If you think an Ikea kitchen is a good choice, you have obviously never fitted an Ikea kitchen before.

Your comments about sourcing materials for 'next to nothing' from your day job are pure fantasy.
For one thing, materials cost money unless you were intending on blatant theft.
For another, property developing is a full time occupation, not something you can do here and there on the odd weekend when you have some spare time.

tony6403

tlh858 wrote: »

Rewiring a house takes far more than some cable rods and pliers. If you haven't done any rewiring before, forget it. It's all very well having it inspected afterwards, but what happens when the inspection reveals a list of defects which is the length of a toilet roll?
The same applies to plumbing and central heating. There are regulations which have to be complied with.

.

OP may find real difficulties trying to get a qualified electrician(QE) to certify work that the QE didn't actually do him/herself. This is hardly surprising , how can someone sign a certificate of compliance in respect of a full rewire when they haven't performed any of the installation. A risky proposition.
Might be able to get a Gas Safe engineer to certify a gas boiler as this can more easily be checked out.

southcoastrgi

tony6403 wrote: »

Might be able to get a Gas Safe engineer to certify a gas boiler as this can more easily be checked out.

I wouldn't bet on it

stuart888

Russe11- so the main of your argument is your belief that property values will plummet... Forverer? My gut instinct tells me house prices could slip further in the short term due to a number of impending economic issues and then have a stagnant decade as has historically been the case. Imagine I saved for u further 2 years say 40k and invested in a flatline market? Would you be more optimistic about this? Also factor in improvements to the properties values vis a vis other propertiesto due to renovating.

Also low interest rates mean currently yeilds on rental properties are pretty good. Naturally maintenance and voids will reduce this but its perfectly feasible to make positive cashflow on property atm. I no several people who are doing it.

stuart888

Thl858- thanks for you ( rather blunt! ) imput

On the subject of cheap materials. I'll be viewing properties that are both newly refurbed and not. And attempting to turn the non refurbed into the refurbed ( so same quality finish ) for less than the price differential. The reason I said cheap is because I'm looking at lower end properties. Nonetheless as I intend to let it out ill endeavour to ensure durable materials. Addressing your specific points.

I'd previously thought engineered wood to be preferable to laminate but after looking at at GMC laminate cutter for the purposes of cutting wood have laminate on the brain! Your opinions on floor suitability appreciated.

I have assisted developer wrire half a dozen properties. All passed with no real. problems. My intention was to have him help me in exchange for doing some free plastering at a later date. Same for plumbing but would have a engineer install boiler. Would invest a lot of time haggling with merchants over boiler cost as its one of thr bigger outlays but stick with rated brand like Worcester.

Services aside I'm not planning on major structural works so should avoid needing building control approval. New windows and doors externaly may be the exception but not something I'm uncomfortable with. Have reapair render around many a window badly fitted by the likes of Anglia/safestyle so am quite familiar with them.

Can take waste to parents garden and dispose of it gradualy at several tips if skips seem to expensive.

Have fitted several Ikea kitchens as my developer friend seems to like em. After chasing out for services due to lack of void and leveling with packers instead how is it much more difficult than the Wickes/magnet standard types? Who incedentley I may get my kitchen from anyhow.

Can get cheap materials from work as we use a lot of proprietary products with if left over are unlikely to be specified with use by date ( normally 12 months ). In the past I just sacrifice some holiday time in exchange for them as I don't use the time due to saving all my Money!

Feedback appreciated!

keystone

Stuart

You absolutely get maximum points for enthusiasm and enterprise.

Your posts do not instill any confidence though that you have sufficient experience or knowledge to undertake the work yourself. So, as I said before, you appear to have a serious learning cliff to climb (its like a learning curve but an awful lot steeper). So your first refurb is likely to be a money pit for you irrespective of buying the place first and likely returns when you flip it. I do not think you have sufficient capital under your belt to embark on that route but as you appear to think differently I can do no more than wish you well with your project.

Cheers

Russe11

stuart888 wrote: »

Russe11- so the main of your argument is your belief that property values will plummet... Forverer? My gut instinct tells me house prices could slip further in the short term due to a number of impending economic issues and then have a stagnant decade as has historically been the case. Imagine I saved for u further 2 years say 40k and invested in a flatline market? Would you be more optimistic about this? Also factor in improvements to the properties values vis a vis other propertiesto due to renovating.

Also low interest rates mean currently yeilds on rental properties are pretty good. Naturally maintenance and voids will reduce this but its perfectly feasible to make positive cashflow on property atm. I no several people who are doing it.

The market had already dropped significantly, in real terms not nominally, I doubt we would see massive nominal drops unless there was a trigger like interest rate rises. If there was nominal drops of 40-50% theres is plenty of cash rich people out there that would fill their boots... they can keep on dreaming.

Why would you want to go to all the hassle of being a landlord just to have your wealth tied up in one asset?

I'd question further the people you know that are doing this, do you actually know the equity they hold, the interest rates, the yield etc or is it just the case that they brought in a few years ago and like to drop it in conversation that they have properties they rent out... failing to mention the hassle, the real term loss on investment(recent years), anything amounts they subsidise out of there own pockets?

Yeilds at the moment are not good, property rental investments realisitically need to be getting torwards double figure % yeilds to make sense... lower yeilds are only consisdered great because of the leverage factor, but unless the assett is increasing in value then where does the gain come from?

Those I know who are truthful and up front about thier property investements say to me all thats holding it together for them at the moment is the interest rates, they would if possible like to get out if truth is told but they would have to take losses to sell which they financially can't do. I know of a few who own at the bottom of the market and get tennants in, 6 months down the line they move out again, because the property only really appeals to young professionals who often change jobs, go for different rental option etc.

One person I know has the retire at 40 plan, all going well with their rentals etc in early 30s, think is they do have a large 6 figure income, so how well they are truely doing and could they be better off not investing in more properties remains a guessing game, I do know they are struggling to refinance some of their rentals. I belive the reason they have not sold the properties than try refinance is the real reason is they would be sitting on a loss and to continue on and hope to keep the plates spinning makes more sense.

I know of others in commercial holdings, but they are more of multimillionaire buy assetts out right where they feel they can do better than holding cash, these investors can take a loss or changes in the economy because they own outright.

All that said and done i've seem some bottom of the market places, ok so mainly northern towns going all to cheap it seems at auction. Now these make perfect sense for housing benefit rentals, the question seems to be though that with reforms in housing benefits and questions over what will happen next that its a risk in itself.

Up till a couple of years ago it was quite simple to get a town house, rent it room by room to students, nice premium to be had offering all in weekly rates. All fine when the students could get it all loaned, but thats taken a big hit with the drop in student numbers since tuition fees.

If all the sums work out then go for it, I suppose i'm very risk averse, which is why I backed out of a property purchase a couple of times over the last few years, i'm glad I did as well as would be sitting on a good 20% loss if I had to sell now(taking into account all costs) and thats if I could sell at the current advertised prices.

drummer_666

tony6403 wrote: »

Keystone is right - £30k isn't anywhere near enough to buy and refurb. a house.

It can be enough, it depends what house you buy. what deposit you put down etc.

After I've done refurbing my property (which is/was complete renovation) it will have set me back £35k, but I put down a 25% deposit, with a lower deposit around £30k is do able.

Ok then you need higher equity for BTL but after the refurb the market value of the house should have increased enough to cover this

But Stuart, it isn't easy and everything takes far longer than you think, but you seem to have the enthusiasm needed for it. This is my first rennovation and at times I felt I'd taken on too much, having never really done any DIY before, but I have learnt so much that will be useful on another house in a year or two.

You also have the luxury of being able to live at your parents house rather than the building site of a renovation

stuart888

Keystone- are you saying I don't have the ability to undertake the physical work? As I think I stated my old man has 30+ years experience in general building work. In that regard I could well buy a property and hand the keys over to him to renovate it. I agree ill learn an awful lot in the process but ill have the experienced help to make sure work is done properly. Eventually I aim to have complete comprtance as to be able to do it all myself. Also I don't intend to flip ( assume you mean sell? ) but let it out and remortgage to buy another ( not straight away I imagine )

Any thoughts on this?

stuart888

Drummer- thanks for your input, could you elaborate on your project? Cost of purchase, amount borrowed/scope of work ect? Are you planning to live in it or sell or let out?

Id planned to live there to save travel time traveling to and from the house. I stay at my girlfriends most the time atm so would probably stop there when it becomes to much sleeping on a camp bed or when there's no bathroom!