What am i getting into??!

[sylvana]

Originally Posted by brian

I can't think of a more dangerous situation - you want to through a lot of money into a new business which by your own admission you have no experience or knowledge of.

And this all in the middle of the biggest economic crisis for nearly a century?

I think you are just inviting trouble - seriously.

I wish the doom and gloom merchants would refrain from throwing cold water on everything anybody posts in here. Have you ever thought maybe it's YOU that should get out of the property game if you have not made a success of it ??

[sylvana]

Originally Posted by brian

And this all in the middle of the biggest economic crisis for nearly a century?

I think you are just inviting trouble - seriously.

Oh so you are an economist as well are you ? I suppose you would advise this guy to not buy a house until property prices have risen again and interest rates have gone up ? And what should he do in the meantime ? Throw all his money down the toilet renting a place that will never be his ? For those who know what they are doing, this is the BEST time to invest.

[IFA]

Doom & Gloom or Common Sense?

Cold Water or Reality Check?

It really depends on your perspective.

This young chap is entering into a huge commitment of time, effort and cost with a clear lack of knowledge, experience, preparation, foresight, skill, expertise etc.....

What he does have is enthusiasm, energy and optimism.

Only time will tell if that is enought to steer him through the process without making a complete mess of things.

What the "doom and gloom merchants" are trying to encourage him to do is to think more clearly and plan more meticulously before entering into a financial commitment that could end up causing him years of difficulty if approached from an ill informed position of ignorance.

I'm sure nobody here wishes him any failure or embarassment but surely there's no harm in some constructive criticism to point him in the right direction? After all - he did ask!

[sylvana]

[QUOTE=IFA;15641]
What the "doom and gloom merchants" are trying to encourage him to do is to think more clearly and plan more meticulously before entering into a financial commitment that could end up causing him years of difficulty if approached from an ill informed position of ignorance.

QUOTE]

The advice is both negative and ill-timed. He has already bought the house ! The horse has bolted, the ship has sailed, yadda yadda yadda

Markus, I really hope this project of yours works out for you. Judging by your patient and well-humoured responses to some of the unkind comments that have been fired at you, you are obviously a nice lad and unlike alot of 18 year-olds out there, you are not afraid to get off your butt and do something with your life. When I was your age, I was moping about in my bedroom listening to The Smiths and penning god-awful poetry...

[IFA]

I agree that some of the previous comments could have been more tactful and constructive but the advice is neither negative nor ill-timed.

Yes he has already bought the house, but that isn't the cause for concern. I can't imagine that anybody here would disagree with you that buying a house in the current economy is not a bad investment, particularly if that house needs renovation or if you are intending to improve, extend, convert or otherwise increase its value over time.

The advice is in fact perfectly timed because it is not the buying of the property that is being warned against but from this point onwards Markus could find himself causing significant problems and difficulties if he starts DIY-ing things that he really shouldn't be touching.

Does he know, for example, that if he wants to re-sell the property the solicitor acting for the buyer will ask to see FENSA certificates confirming the safe and correct installation of any replacement double glazing? Is he aware of the regulations regarding where windows allowing egress in the case of a fire should be fitted? Does he know that only qualified Gas Safe engineers are allowed to work on gas installations in his home? Does he know that incorrect wiring in a house can lead to the place burning down around his ears and what to do to avoid this? Does he know how to properly earth-bond his radiators (if he's even heard of earth-bonding)? Does he know how to tell the difference between supporting walls and stud walls and does he know the implications of messing with a supporting wall?

The list is endless, you only have to watch a few "DIY Disaster" programs to know that much - even the so called professionals often get it wrong

I too wish Markus the best of luck; it really sounds as if he's going to need it, and your blind encouragement to basically "get stuck in" with no concern for how things should be done properly is dangerous in my opinion.

Markus - you really need to ask more specific questions about individual issues that arise as they come up. Nobody here can give you advice if they don't really know what the question is. As stated above, there's so much involved and we don't know what your house is like, what work needs doing, what your plans are or anything else that enables anyone here to give you pertinent and accurate information.

If you hit a problem or need to have technical advice as and when you are about to tackle a job then ask away!

[brian]

Originally Posted by sylvana

I wish the doom and gloom merchants would refrain from throwing cold water on everything anybody posts in here. Have you ever thought maybe it's YOU that should get out of the property game if you have not made a success of it ??

I'm not in the "property game", but over the years seen plenty of people enter these forums with that idea, because of all the property TV shows being aired suggesting big returns.

Too many people are being beguiled by the suggested promise of easy money, simply that.

The bottom line is that starting a new business can be a big challenge as it is, but putting all your money into a new business where there's no understand of the business requirements is a potential recipe for disaster.

Originally Posted by sylvana

Oh so you are an economist as well are you ? I suppose you would advise this guy to not buy a house until property prices have risen again and interest rates have gone up ? And what should he do in the meantime ? Throw all his money down the toilet renting a place that will never be his ? For those who know what they are doing, this is the BEST time to invest.

Sure it is - Greece will default, Spain, Italy, Portugal and Ireland all lined up next when that happens - we're facing a major financial crisis ahead.

And all against a backdrop of UK property prices which are still at a historical record high against earnings.

Note that in all previous recessions there have been significant falls in property prices, yet in the biggest financial crisis for a century at best the decline is up to 20% and only in some areas.

You don't need to be an economist to figure that we're facing serious economic headwinds.

Hence why trying to set up in business as a property developer without really understanding the business will necessarily raise warnings.

I really do wish anyone starting a new business the very best of luck - I just personally think that anyone looking to get into property development should ensure they have as much knowledge and experience as they can before starting, and that's under normal economic conditions, let alone the extreme ones we have now.

[Dan_Manchester]

This is an interesting thread and good luck to the OP.

IMO the advice to date whilst perhaps slightly harsh is fair - it doesn't matter if it's a property development business or a kebab shop, you need to know you're market, you're costs, the regulations covering your actions and so on.

For example, I suspect it's unlikely you'd take £100k loan to buy a retail unit, fit it out and open the doors without a business plan, cost analysis and a whole range of detailed systems in place however it seems that many poeple feel due to high profits advertised on TV etc that property is the most simple and sure-fire way to be a millionaire in 5 years.

The experienced ones will know it's not as easy as it often makes out on TV. Dealing with solitictors, late nights stripping wallpaper and sanding doors for hours on end is required but not always fun. That's before you even try to sell or let the place...

[Dan_Manchester]

... having said that, do your research, buy the right place at the right time, spend the right money on it and let it to the right tenant then it can be a nice passive income stream.

[JulieJuls]

Markus, good on you for attempting such a big task - I really hope you do well. The first thing I would do is ask 2-3 builders/decorators to visit your property and give you quotes on what could be done to add value to the property and how much the changes will cost. This will give you a pretty good idea where you could start should you choose to start the work yourself but I'd leave most of the work to professionals because it can cost you money to try and do it yourself. I can't remember if you said, but do you have any finances to fund the renovation itself? If not, might be good to arrange this so you can start the work slowly.

If your place is habitable, and has a second bedroom, you could rent the room out to a lodger and get some money through that to help keep you afloat.

[JulieJuls]

Also, get a few estate agents in to find out how much your place could sell or rent for should it be renovate to a high standard. Ask them how much they would market it for and how much it might actually go for. Assume you'll get less and ensure the renovation costs you're undertaking are the type of things that will add the most value for a sale.