'Property investment can be lucrative - but the pitfalls are plentiful'
So many people are scared off property investment in North Derbyshire because they don’t have the staying power.
Ten years is regularly the investment period you’ll hear quoted – a decade is the average time it takes for a property to double in value.
To some, 10 years is an awfully long time. To others, the likely profits are worth the wait and – done right – you should have tenants queuing up to cover the mortgage for that period.
But there is a shortcut to sizeable gains.
I’m talking about “flipping” – put simply it’s buying a property, doing it up and selling it for a profit.
The process can and should be done as fast as possible – a year or under is the golden rule – but it takes skill and experience, and the pitfalls are plentiful.
I tend to recommend looking at terrace houses – something there is plenty of in the area – if you’re just starting out.
They are more affordable and you’ll normally be selling to a first-time buyer, which means there is less chance of the sale falling through.
There are still myriad potential downsides though. Costs of a refurb can be extortionate, unless you know what you’re doing.
You need to know the property’s in good shape before you buy.
Survey is a good idea
You may have already had a mortgage survey carried out for lending purposes, but remember the surveyor will have been working on behalf of the lender not you.
If they thought the property needed further investigations, they would normally suggest you arrange a structural survey.
If you’re in any doubt it’s worth investing in one, rather than inheriting a problem which could run into thousands down the line – there may be hidden issues like damp, dry rot, Japanese knotweed, asbestos, or a new roof might be needed.
Many developers will recommend you only buy at 25 per cent below market value.
However, you can’t always get houses at that price, so sometimes you can save money on the refurb, or maximise the sale price by investing in improvement works.
I regularly help people with the process through sourcing investment properties, help with refurbs and help with the re-sale.