Things to consider during property development
Buyers are beginning to look for properties in need of a little care and attention in order to make a profit when they sell, as so property development is increasing in popularity. If you’re new to the property development industry, or you’re beginning a new development soon, then there are a lot of things to know before you start.
Know your costs
Making sure that you know near exact costs of the development before it begins is absolutely crucial to ensure that you have enough money to see it through. Knowing the costs beforehand can also help you to decide whether or not it is worth going forward with the project, and if you can make a profit a few years down the line. Figures that you should know include the current property value, the value of similar properties in the area, the value of your property post-development and, of course, how much money the property development will cost you overall.
Know your purchase
When buying a house in need of some development, make sure you know exactly what needs to be done and where. A lot of problems that need to be resolved in run down properties aren’t visible, and if you are unaware of these, can lead to extra costs that may postpone or put a stop to your property development.
Know your value
Some developments add more value to the property than others – for example, if you’ve purchased a property that has limited or no parking, then it’s a good idea to include a garage in the renovations, which will add value to the house, as opposed to an extra living room. Also, make sure you have the appropriate planning permission, or that the property to be purchased already has planning permission, to avoid problems with the local authority later on.
Know your budget
Setting a budget at the beginning of the property development and sticking to it as strictly as possible will make sure that your profit stays high. By all means, take risks during development, but only if you’re sure it’ll pay off – otherwise, it could end up being money down the drain.
Know your coworkers
Working with people that you know and trust on a property development is just as, or maybe even more important than anything else. When hiring tradesman to assist with the project, you can ask people you know if they recommend anyone, to ensure that they are reliable. Make sure any tradesmen that you’re considering hiring have good quality references.
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