Help wanted for property developing beginner

[deanoliveravfc1]

Hi,
I'm keen to start property developing but wanted to get all the advice i can get from people who have already started doing it.
I'm 27, just recently bought my 1st home with my wife and i'm an electrician.i can do alot of the work myself as i'm in the construction bussiness and know the right people who could help me ie;plumbers/plasterers.
Do you go to the bank with your plans in place ie; I've found a house to develop, its 100k. the work that needs done to it costs 20k, the house is estimated to be worth 150k when the work is complete, it will take 4 weeks to develop.
as i'm new to this any help would be great, would i need to take a 2nd mortgage out for the developing property or would it be a loan??
i am passionate about property developing and want to try it, i know location is key, any tips would be very much appreciated.

many thanks,

Dean.

[brian]

The big problem you've got at present is a slowing property market, lowering prices, slowing demand (as the buy to let market dries up), plus the credit crunch making banks less enthusiastic about lending.

So if you're looking to develop property, I'm afraid you're trying to join in at the very end of an economic cycle, ie, downturn.

It doesn't mean to say you can't do what you plan successfully, or that you can't look to invest for the longer term - it's just that short-term conditions are very much building against you.

2c.

[pds999]

Totally agree with the above. I do think the market will stablise though so you shouldn't be affected adversely at least.

I'm not sure I agree about slowing demand though. In any market where demand exceeds supply there will always be a favourable position for the seller; the UK property market is no different.

[brian]

I think the big pointer is research - some areas are being affected by slowdowns more than others.

[Mansel]

Now is the time to buy but it is not the time to sell. Are you thinking of selling the property after you have jazzed it up? Maybe look at renting it our if the rent will cover any mortgage you may have on it. With mortgages you used to be able to get a development mortgage where they will lend you on a piecemeal basis, come and check up on the work you have done and then forward you that part of the money. I wish you good luck with it!

[bonetti consultants]

Take a bit of advice from all the above, if you have the contacts in the industry then take full advantage of it, not sure of your local economy but think about ex local authority houses (end of terrace) and split it into 2 x 1 bed flats, start with something smaller, maybe even a small refurbishment, then move on to the larger projects. No matter how much you already know your first development will teach you areas that you may need to touch up on or take professional advice next time.

Good luck –

Regards
Bonetti Property Development Consultants -Property Developers

[KevinR]

Hello,

Bonetti - no offense but flat conversions are a bad idea these days, flats prices are dropping like a lead balloon, my advice is to avoid flats like the plague, look for a decent family home in a good location, anything with a large garden will always attract buyers.
I think the professional BTL'ers will be out in force next year after selling of stock in late 2006 and early 2007 so anything that could attract investors could be a safe bet, contrary to belief a lot of experienced BTL investors look for properties in great condition so they can get people in straight away!

Happy hunting!

[TheSecret]

You have to have the right strategy for the right stage of the property market cycle and adjust accordingly, i suggest that buy to sell may not be the most effective strategy in the comming year.And don't forget the old saying 'you make your money when you buy' regardless of the market cycle that saying remains true.

[got2know]

Originally Posted by deanoliveravfc1

Hi,
I'm keen to start property developing but wanted to get all the advice i can get from people who have already started doing it.
I'm 27, just recently bought my 1st home with my wife and i'm an electrician.i can do alot of the work myself as i'm in the construction bussiness and know the right people who could help me ie;plumbers/plasterers.
Do you go to the bank with your plans in place ie; I've found a house to develop, its 100k. the work that needs done to it costs 20k, the house is estimated to be worth 150k when the work is complete, it will take 4 weeks to develop.
as i'm new to this any help would be great, would i need to take a 2nd mortgage out for the developing property or would it be a loan??
i am passionate about property developing and want to try it, i know location is key, any tips would be very much appreciated.

many thanks,

Dean.

Hi everyone. This is my first post on this forum. I too was looking for some information and came across this thread. I think the point that Dean was making, or rather, the question he was asking was - how does someone go about raising the finances to get started. Answering that question would be great for Dean and myself.

Good Luck in 08.

Bill.

[Wilbur070671]

I have created a new thread for this called "Getting Started - Raising Finance and Beyond", posted 22/01/08

Cheers,
William