Property investment has reaped great rewards for many over the years, both for those hoping for a quick return by selling on the property at a profit, and for those with longer term plans in the buy-to-let market. Before you decide to make the leap, make sure you’ve done all the necessary research and know exactly what you’re getting into. There are pitfalls as well as gains.
Know Your Market
You stand more chance of success, with less work, if you’re familiar with the area you plan to buy in.
For instance, if you make the mistake of buying a small studio flat in a remote part of town that’s favoured by affluent families, your pool of potential buyers or renters will be smaller because your target market is looking elsewhere. If you’re aiming to let to students, buy close to a college or university, and young, single professionals tend to favour town centre locations or those close to fast travel links. It may sound obvious, but it’s easy to get carried away with what looks like a bargain and forget the practical aspects of who is going to live there.
Pay Attention to Current Events
Akin to knowing your market, knowing what’s going on in the wider world and how those things might impact the property market in general can pay dividends. In some cases, world affair knowledge can almost provide you with a crystal ball in knowing what, and when, to buy.
For instance, by keeping an eye on the recent financial crisis in Greece, and balancing that against the strong pound and UK independence from the Euro, you may have been able to foresee the recent increase in demand from Greek nationals in the Prime London property sector. Those Greeks with money to spend, looking for a safer investment proposition than currently offered in their own country, took a keen interest in London property around the £1 million mark.
Organise Your Finances
Before you even start looking at potential properties, get your finances in order. If you need to borrow money, investigate mortgage deals. Independent brokers will give impartial advice on the best mortgage deals currently available, and let you know about the latest developments amongst lenders. One trap not to fall into is to simply walk into your own bank and take the first deal they offer you. There are often far better, more specialised offers around that you’ll only uncover through a diligent search alongside expert advice.
Having got your finances in order, and an offer in principle on the table, you’ll be in a much stronger position to negotiate with sellers for the best price.
Get Buying Help
Because investing in property takes up a huge chunk of money, it pays to use every advantage available to cut down risks and secure great deals. Whether you’re looking for a place to live in personally or you want a property purely for investment, a professional property buyer can prove invaluable. It’s their job to scout out the latest deals and they often have a large network of estate agents, developers, or builders who keep them informed. They also have expert local knowledge, know what’s in the pipeline (such as major town development or renovation, for instance), and can guide you accordingly, preventing costly mistakes.
Property investment is scary and exciting in equal measure. Get it right and the rewards are huge. Take your time, check every step, and you’ll have a far greater chance of success.