Three key rules to property development
16th February 2012
The housing market, like many other markets in the UK, is in a fragile state as a result of the credit crunch. Getting a foot on the property ladder is hard enough, but climbing that ladder to the top is now harder than ever.
But property development is still big business, even in this unstable market. Successful property developers can make themselves very rich, if they know where to look.
The formula is always the same: buy a property for as little as possible, add value to that property, and then sell it on for a profit.
It seems so straightforward that it’s surprising that not everyone is doing it. But there are, of course, pitfalls, complications and a whole lot of risks involved.
So what should you consider if you are thinking about property development? Even if you are just trying to sell your home for as much as possible, these golden rules will come in handy.
Stick to your budget
Whether you are turning a derelict farmhouse into a million pound mansion, or just redecorating your home’s interior to make it more attractive to potential buyers, sticking to your budget is vital.
Set a budget before you undertake any project. Make sure it is realistic and, more importantly, that you can stick to it.
If you give yourself too big a budget, you could end up spending money too easily. But if you don’t make it big enough, you’re setting yourself up for a shock.
Don’t cater for personal taste
Everyone is different, and one person’s beautifully decorated dining room could be another’s worst nightmare. So the trick when developing a property to sell at maximum price is to avoid your own personal tastes.
This means keeping things general, so lots of pale colours and pastels inside, no opinion-dividing paintings on the wall and certainly no unusual exterior colours.
Pick the right people to work with
You may be something of a DIY wizard, but there are some things that will require a professional touch. The quality of a professional job will make or break your development.
So be sure to find a reputable builder, plumber or decorator that you trust to do a professional job and not leave you shelling out even more to have the work redone.
If you are in the process of doing up your home before moving, remember to check that your home insurance is still valid when you move.
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