As
we begin a new decade, many of you will be looking to
maximise your income and broaden your approach to property.
For many BTL and land investors, developing for profit
is a natural progression. In fact, it was the path I
took – and I’m sure glad I did. The potential
profits can be truly staggering...
“How much experience do I need?”
I didn’t know anything about construction when
I started out… and I still wouldn’t know
how to place one brick on top of another! But if you
have the right team around you, including a good architect
and a quality single main contractor, you can leave
all the hard work to them! If you use industry standard
‘fixed priced’ contracts, the contractor
handles all the construction work within an up-front
agreed price – so you won’t get any nasty
surprises, therefore minimising risks.
“What about the finance?”
Restrictions in the finance market are easing, so developing
is becoming viable once again. Lenders are returning
to the market with new development finance products
and loan-to-value ratios are increasing all the time.
65% loan-to-value is once again achievable for certain
deals.
Of course, the most critical element of the deal is
securing the land at the right price. If there's enough
capital tied up in the land, then it's possible to fund
the deal with little (or possibly no) money down…
“What about the state of the market?”
Recent news reports suggest that we may be slowly emerging
from the recent property crash. For example, Barratt
recently announced that forward sales are 43% ahead
of a year ago. Plus, RICS figures show that house price
rises are likely as demand for available property outstrips
supply. That’s why I recently took my first steps
back into developing. Although I’m only developing
a very small site of two semi-detached houses, the project
should return a healthy profit for very little “work”–
no more than two or three hours per month from start
to finish!
The
return on my time from a small project like this is
significant – hopefully around £70k. I anticipate
that this development will take around six months. I’ll
be keeping an online diary of the progress of this project.
If
you’re interested to see how it’s coming
along, keep an eye on my blog at www.ukpropertyexpert.com
If
you’re interested in finding quality development
land, a great place to start is www.LandLounge.com
– a specialist online land agency run by my brothers
Jonny and Glenn. There are many exciting opportunities
listed, with and without planning, across the UK. And
we’re at your disposal to help you to approach
landowners and broker discounted or JV deals!
So
will 2010 be the year you take the next logical step
in your property career? Will it be the year you start
to supplement your “slow burn” BTL income
with comparatively quick, life changing profits from
developing? It really isn’t as difficult as it
sounds. If I can do it, anyone can!
Want
to learn how to earn FIVE and SIX figure profits from
a plot of land - without buying or owning an inch of
it?!
www.ukpropertyexpert.com
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