Property investment is a very common hobby/passive income as it is so easy to do. People now see the opportunities in real estate where they can generate additional income. However, it isn’t as easy as putting in a deposit and then that is that. You have to worry about property management as well.
If you’re willing to make the sacrifice of your life by committing to property investment, there are two significant advantages to doing so. One of those is capital appreciation. That means that the value of the property automatically increases over time. For example, if you no longer want to manage the properties which you own, you can see them for a large amount of money, depending on how long ago it was when you bought the property.
The other advantage of property development is income generation. This is when you keep the property, renting it out or using it as an Airbnb. It allows you to generate a steady income each month, also known as a passive income.
The question that many people ask is how do you get into property development?
Purchase Residential Property For You To Rent or Sell and Renovate
The best place to start is purchasing residential property as this is the more affordable option. However, choosing residential properties that are run down will be even cheaper. If you want a quick win and sell your property, buying a place that is run down will be the best for you.
Yes, renovation can be expensive but if you get a building surveyor, you can work out how much it will cost. Once you have purchased the property and completed your renovation, you can then sell it. Also, remember to check what other properties are selling for in the area. If the cost of the property and renovation is more than those in the area, you should probably avoid it. You also have the option of renting the building out until there is a significant increase on that property.
Purchase A Commercial Building and Convert It To a Residential
As there is a housing crisis in the UK and other countries around the world, there is an increased demand for residential property. Landlords are selling commercial property so it can be converted into residential property.
Before you purchase commercial property, look at how many square metres there are in the building. If there is enough space for houses or converting them to flats, it will be worth the investment, depending on the cost of the building.
Read: Mistakes to Avoid When Choosing Apartments For Lease Near Me
Consider Building Commercial Property On Your Premises
The final option is to consider turning your land or home into a commercial property. If you decide that you no longer want to live there. It is a great way to generate more money and save money on investing in a new building/land.
It will only be a valuable investment if you have the space and land. For example, if you believe you can fit another house that is the same size as your existing house, you should consider it. However, remember to get a valuation on your property before you consider this move. Ask them how much it will reduce your property. If it reduces it by more than the building you will sell, it isn’t worth the investment.
Starting From The Bottom
Another great way to get into property development is by buying land with nothing on it. It can be converted into residential properties such as bungalows, houses or apartments. It is up to you which one you would prefer however, you will need planning permission for this.
Buying land is a massive risk for those whose first time it is buying property. Nevertheless, the gains are massive so if you can convince the lender that you will be able to pay the money back and will profit a large amount, this is one everyone should consider.
Before you buy any land, you need to seek planning permission. If you can’t get planning permissions, there is no point in buying that land. Plus, it is probably empty for a reason as others cannot get planning permissions either.
If it is your first time buying land, we encourage you to get a good experience as a construction project manager. You will also require a team of contractors to complete your building work.
Summary
There are many things to consider before committing to property development. It is also very time-consuming, especially if you wish to see massive returns on your investment. Nevertheless, if you have a good team to back you up, you can generate a lot of money.
Remember, there is nothing wrong with purchasing rundown buildings either. There are plenty of opportunities to earn money through this as well. Just remember to get a well-experienced commercial or hospitality fit-out team to renovate your property and you will earn a lot of money.