When it comes to buying houses, we all have investment in the back of our minds. Property is often the most expensive commodity we own. And, it also stands to earn the most money in return. That’s the case no matter what house you buy. You could do absolutely nothing and still stand to see some serious money a few years down the line.
But, that investment potential reaches new heights when it comes to buying project properties. Some of us avoid them, some of us embrace them. But, no matter your stand; this is the way to make real money on real estate. In fact, it stands to see you earning substantial amounts. You could even clear your mortgage debt far sooner than you would otherwise.
That said, not every project property fulfils this promise. In fact, this is somewhat of a risky investment. So, how can you tell whether a project property is worth your money and your time?
Consider upfront cost
Even with a project property, the upfront cost is the main expense. So, this is the first thing you should consider. Admittedly, this isn’t a cut and dry issue. After all, you do stand to double that investment. But, that’s not guaranteed. While companies like Belgravia Finance Brokers can help you with a bridging loan if your mortgage doesn’t cover up-front cost, you still need to stick to a sensible budget. Else, you could land in debt. So, do your research before committing. There’s nothing wrong with financial aid here, as long as you know you can pay it back. Estimate the cost of work, and also the resale value. Only then can you tell whether the price is worth paying.
Know how deep work goes
When it comes to projects, work is often only on the surface. Sometimes, redecoration and a little attention is all it takes. Other times, you’ll need to embark on heavy renovations which could cost a lot. To determine which you face, visit the property a few times. Don’t be afraid to get stuck in with a tape measure and drawing pad. It might even be worth visiting with a builder who can give you quotes. Obviously, a property with only surface work is sure to be a sound investment. But, a massive project might not be worth your while in the long-run. Compare the price of the property to others in the area. Then, add the work costs to the asking price to see whether you’re still getting a bargain.
What’s going on in the area?
Speaking of researching the area, it’s also worth knowing what’s going on there. A project property in an upcoming area is an investment dream. If there’s future development work in the town, you’d be mad not to take the opportunity. But, if house prices are dropping, you could lose money. Speak to locals and visit the council website. If you come across any red flags, it might be worth leaving that project well alone.