Property Development

Smitho3

Smitho3

Smitho3

Soldato
Joined
18 Oct 2002
Posts
2,847
Location
Cardiff
Hola,

Does anybody here develop properties for a living/Sideline? I am thinking of taking this up as a sideline venture and after watching people stress out over it like it’s the end of the world on these property programs on TV I was wondering, is it really all that stressful? Is the money as good as it appears to be if you use your noggin?

I will have the opportunity to buy into a new build development and walk away with 35-60k gross profit this year. Should I just use that as a deposit on buying a family home or should I invest and borrow money to get into development.

Please share your experiences good or bad.

Cheers

Lee
 
markyp23 said:
It's not the best time at the moment.

What do you mean buy into a new build development?
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I won’t be in a position to do this for at least a year yet and I won’t be touching the market until things stabilise so there’s no rush really. The in-laws have a large garden with rear on road access. We have just drawn up the plans to build a two bedroom bungalow and I will be financing it.
 
It will most definitely sell as there is a shortage of bungalow availability in the area. Recent sales have gone through remarkably quickly and for far greater than we hope to achieve, so anything else is a bonus! As far as problems go i will be putting in a fixed amount and the rest will be made up by the in-laws. Any problems will be dealt with by them. The shell will be built by a contract builder (who we are acquainted with) and the remainder of the work completed by my father in-law and brother in-law (owners of a property Maintenance company). We are at the planning stage at the moment so until the planning application has been approved we wont be doing anything.
 
stress?

Just think, you buy a property, the mortgage will have to paid. All the while you are doing work on it, say 3-6 months depending on the amount of work needed. So you have no income from rent, and money is flying out the door with mortgage, materials, labour, bills and more bills. Who is going to support you at this time? Your other job? If you have another job to support you then you won't have a lot of time to work on the property meaning it'll drag on longer than it needs to be, if you hire someone then it'll cost you more. Then when you finished, you get it valued, is it going to me worth more than before? even its more, is it more than what you spent on it? taking into account all the costs and time you spent on it, if it barely break even then it's not really worth it. It's only truly worth while is when the market is going up like crazy so you do make that 30k AFTER all the costs listed above.

And that is IF you sell it at the price you want it to.
 
Bug One said:
D) you will get planning permission.
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If he's just doing interior work then he won't need planning, if he just want to knock a wall through here and there to make it open plan etc, he only need building reg. That only needs to be shown with calculations that it will stand up, a few hundred quid for a engineer to draw up some sections and a few equations will pass building reg.

That is provided of course he doesn't buy a listed building.
 
At the minute it is a no go, people cant get the money for property development. The once who are starting off invest there own money but once you have made some you tend to loan money to develop, don't know many clients who use there little pots! but even they are finding it hard right now. The chances are at the minute the cost to develop will out weight the market value in the end taking into account all expenditure, and the fact people cant get a mortgage above 75% now. We are starting to feel the pinch in our sector already!
 
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I'm with Fox here. I'd not bother.

Also you're getting yourself into debt with the possibilities of recession and it just not selling as well as unkown factors.

If you're comfortable with the debt side and the venture then go for it.
 
Raymond Lin said:
If he's just doing interior work then he won't need planning, if he just want to knock a wall through here and there to make it open plan etc, he only need building reg.
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He's building a two bedroom bungalow from scratch.

Will definately need planning permission. :p
 
No, the reason why house prices shot up was because of these buy to let and so called property developer's buying homes, spending a couple of grand on them and selling them for a huge mark up. Look at the house prices coming down, people said it was due to demand the prices went up but the demand is still there but the prices are coming down and where are all these potential buyers living....hmm.
 
I'm just finishing off a new build for myself.
It's my third now.
If your not in the trade I'd seriously consider doing a timber frame build.
I've just done my first and I will never go back to traditional builds, it's so much quicker and easier,especialy for non trades people and the quality is much higher that I'd thought possible.
There's lots of doomsayers on this site, you obviously have the plot(subject to planning so that will save you a load for a start)
Do your homework well and it can be very rewarding AND profitable.
The right products are still selling and always will.
 
If your research is a hardware forum then I'd suggest you've got the wrong attitude. If you want to learn something, learn from people who are successful in the field that you want to achieve success in.
 
From watching many many property development programmes :P and my dad has developed quite a few buildings, it generally won't go smooth if you don't have experience in property development, would help if you knew someone with good knowledge in property.
 
Generally I would not get too involved in property in the uk at the moment as I suspect that prices are going to go down.
However if you already have a plot of land and you want to build a single house I would definitely go for it. As far as I am aware if it’s an individual private build you do not have to pay VAT on the materials and you already have the land which is normally the expensive part so you probably will make a decent profit.
 
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