Our Plan for Property in 2020

Our Plan for Property in 2020

 

I often get asked by my investors and potential investors what my plans are for property. While we help our clients grow their wealth through property, we’re also active investors ourselves. This article outlines our plans for 2020.

 

When planning the year ahead, we need to consider our 18-month cash flow for the business. As I’m sure you can calculate, our plans for 2020 were formulated during the summer months of 2019. That means we’re now looking at plans for early to mid-2021 too! Outwith the services we provide to our investors, we strive to generate strong cash flow for the business both from regular monthly income from rental properties and also lump sums of cash from buy-to-sell projects.

 

This year we plan to grow our portfolio of buy-to-let properties. Ideally, this will be spread evenly across the four quarters of the year, but depending on the properties sourced off-market, there can be particularly busy spells throughout the year. We aim to buy properties at or below market value, to ensure we make money when we buy, protecting the investment should the market take a dip. If we needed to sell a property rather than to hold and rent, the equity gained on purchase is essential to allow flexibility in the sale price. We ensure our rental properties are in the top 25% of rental properties on the market in terms of standards of living, therefore every property we purchase we renovate to a high standard before moving tenants in. This ensures we have minimal gaps in tenancy and our tenants enjoy living in our properties. 

 

We have a small number of buy-to-sell projects planned for this year. The type of properties we focus on renovating are older properties with period features, and these tend to be flats or houses within Edinburgh. We find the key to a successful buy-to-sell project is targeting the customer who is going to purchase the property once renovated. For example, if we decide to purchase a two-bedroom property in a popular area for young professionals and university students, the renovation is going to be quite different to renovating a 3 or 4 bedroom terraced home or large apartment that we plan to sell to a family. Always tailor your renovation to what your potential buyer wants. If you know your local area well, start looking through homes sold recently in the area that have achieved a sale price higher than expected. If you can identify any special touches that made the property so popular with buyers, you’ll do well in a renovation project.

 

We would love to hear from you if you are interested in investing in property. We offer a fixed return on investment for investors who want strong returns from property without owning property personally. We also enjoy working with investors in joint ventures.

 

If you would like more information about investing with us, please click the button below to book a call with me.


Mortgage Changes for 2020

Mortgage Changes for 2020

 

Whether you’re a first-time buyer, a homeowner looking to remortgage or a buy-to-let landlord, 2020 is sure to be another rollercoaster ride in the world of mortgages.

 

There have been a few big changes in the mortgage world for different groups of buyers.

 

First-time buyers will definitely be happy with some of the recent changes. We have seen 95% LTV mortgages re-emerge on the market place. Barclay’s paved the way for more relaxed borrowing rules, allowing individuals to borrow five times their salary as first-time buyers (so long as their salary was above £30,000). This is very interesting for investors looking to flip properties, as first-time buyers often look to purchase properties that have recently been renovated that are ‘walk-in’ condition.

 

Rates look set to stay low for now, with many homeowners capitalising on fixing their mortgage for five years at a low rate. Two year fixed rate mortgages still have a little wiggle room to give in comparison to the five year fixed rate deals, so we will have to wait and see if the banks adjust the two year fixed rates.

 

Your age can play a part in how much you can borrow and for how long. Recent changes in the market have made borrowing easier in later years, with some lenders removing their maximum age for buy-to-let mortgages. We also saw the introduction of 40-year term mortgages, which is likely a reflection of the increase in the number of first-time buyers in the housing market.

 

For those of us who own our own homes, now could be a good time to remortgage. With rates so low and some lenders offering a very competitive ten year fixed rate mortgage, many homeowners will look to remortgage. As rates are low, and stamp duty costly on higher-end properties, it’s likely we will see an increase in borrowing for those remortgaging to renovate their homes or add extensions, as an alternative to moving home.

 

Landlords will undoubtedly need to have their wits about them in 2020. 2019 saw many lenders offering fantastic rates with cashback, but landlords have been caught out with upfront fees of up to £1,995. Two year fixed deals are becoming ever more popular with landlords who are uncertain about the long term profitability of owning properties affected by the mortgage relief tax cuts. 

 

As you can see, 2020 will be an interesting year for lending across the mortgage spectrum. It’s good news if you are due to remortgage, and also great if you are a first-time buyer. It’s potentially less exciting for landlords, however, using a mortgage broker who has access to the whole market may help with profitability from your portfolio. 

 

If you’re interested in investing in property but don’t have the time, knowledge or know-how, then click the button below to book a call with me.


Are Your Savings a Thing of the Past?

Are Your Savings a Thing of the Past?

 

From a young age, most of us are taught by our parents or teachers to save part of our earnings. Save for a rainy day, a deposit for a house, a special occasion, or an emergency. Saving our money is ingrained in us. 

 

But is saving money in the bank a smart thing to do, both now and for future generations?

 

Putting money into a savings account is a smart thing to do for a percentage of your wealth, to ensure you have money set aside in case of emergency. But for many parts of Europe, individuals are being charged to do this.

 

The European Central Bank lowered its interest rates below zero during 2019. Negative interest rates mean it costs you money to keep your savings in the bank and was introduced as a last resort to stimulate growth in the economy in Europe. The plan was to lower interest rates below zero to encourage banks with significant cash holdings to get capital out to work.

 

We’ve all heard the phrases “the rich are getting richer” and “it takes money to make money” but many of us would assume this relates to the rich earning high salaries and accumulating savings in the bank. When we think about our savings account, for example in an ISA, you’d be lucky to make 1% of interest per year on your savings. Considering it costs you money to have your savings in the bank in Europe, this begs the question; how do the rich grow their wealth if their savings are not growing in the bank.

 

Many individuals who are growing their wealth faster than the average individual are doing so by investing their capital in assets. We can accumulate wealth by the rising value of assets, such as property and shares. The wealthier have more assets and more capital gains. These are banked, not consumed, explaining why the so-called rich get richer. Property, in particular, has been very profitable for investors in the UK since the 1990s.

 

Could it be time to challenge our beliefs of putting a portion of your salary every month into savings? I’d say it’s time to reassess what part of earned income is saved, and increase the portion that’s invested in assets. The start of a new decade could be the perfect time for you to assess your current wealth and consider investing a portion of your savings in assets. 

 

If you’d like to get into property investing but don’t have the time or knowledge, book a call with me using the button below to discuss how I could help you on your journey.


2020: What’s in Store for the Housing Market?

2020: What’s in Store for the Housing Market?

 

We are now officially in the next decade, with many looking for smart ways to invest their capital. Property one of many investment vehicles for individuals looking to grow their wealth. But what’s on the cards for the housing market in 2020?

 

House prices shrugged off Brexit uncertainty to end 2019 1.4% higher than at the start of the year, according to Nationwide building society. One statistic to note is that Scotland ranked the strongest performer in property price growth 2019, up 2.8% in the fourth quarter alone. The critical question is: can we rely on this trend of slow growth continuing into 2020?

 

Many key factors are supporting the housing market growth, such as strong employment, low mortgage rates and a lack of supply.  Even in the face of considerable economic and political uncertainty, we have seen slow growth in the property market.

 

One sector of the market has seen steady growth: first-time buyers. The number of people who took their first step on the property ladder last year is estimated to have reached its highest levels since 2007. For individuals looking to invest in the property market, this could be a target market. Identifying areas local to where you live that are popular with young professionals, where you can buy properties that need a degree of renovation and style them to attract first time buyers.

 

Although the end of 2019’s property transactions helped show growth in the market, the number of transactions in 2019 was down in comparison to 2018. Brexit certainly will have put many individuals off selling their properties, so only time will tell whether this will inject some life into the market in 2020. 

 

With the next Brexit deadline looming on 31st January, some are expecting a sluggish January. It will be a case of watching and waiting for many. 

 

Despite the uncertainty and slow growth, it’s still an excellent time to get into the property market as an investor. So long as you buy right, you will be in a strong position to do well in the property market. 

 

If you’d like to get into property investing but don’t have the time or knowledge, book a call with me using the button below to discuss how I could help you on your journey.


2019 Bloopers Reel

The 2019 Bloopers Reel

A very quick message before the festive period to say a huge thank you to all our investors, both new and old. We’ve had a fantastic year working with you and look forward to meeting some new investors in 2020.

I’ll leave you with a little something to end the weekly blog for the year…

The 2019 bloopers reel.

For all of you who have reached out to me to compliment my social media…

Here’s some behind the scenes footage.

My poor media team. Lot’s of take two, take three and so on. But a huge thank you to them for making my content look presentable!

From the team at Nichol Smith Investments, have a very Merry Christmas and a Happy New Year. We’re looking forward to working with you all in 2020.

Best wishes,

Sophie & the whole team at Nichol Smith Investments


Serviced Accommodation: Should You Get Involved?

Serviced Accommodation: Should You Get Involved?

 

Many of us will have heard of serviced accommodation, but today’s blog will take a more in-depth look into it and whether it could be a strategy for you to get involved in.

 

Traditional buy-to-let properties are a familiar concept for many of us, where you rent out an apartment or house to a tenant on a long term basis. Serviced accommodation is a little different from this, as you rent your apartment or house on a short term basis. In effect, the property you rent out is effectively a small hotel as guests can stay anywhere from one to two nights to months at a time. 

 

Serviced accommodation has become a topic of debate in recent years, with lots of media attention surrounding AirBnB. AirBnB is a business that advertises serviced accommodation but has become the go-to company when looking for holiday accommodation. Other companies advertise serviced accommodation such as Booking.com, Hotels.com, Spotahome etc. but we often hear AirBnB being discussed.

 

Serviced accommodation has many benefits for individuals travelling for work or pleasure. Benefits for the end-user are:

 

  • A home from home setting
  • Hotel standard services but more homely than a hotel room 
  • Space: more space to enjoy, e.g. bedroom, living room etc
  • Convenient: guests can prepare food (properties have kitchen facilities)
  • Often apartments will have laundry facilities (washing machine and dryer)

 

Serviced accommodation is becoming ever more popular for business travellers as it gives them more for their money than staying in a hotel. Companies tend to favour serviced accommodation for their workers as it is often cheaper to stay in serviced accommodation than hotels, mainly if the length of stay is weeks to months. Business users will be more likely to do their laundry, cook their meals, and generally expense less when staying in serviced accommodation in comparison to staying in a hotel.

 

You’re probably wondering what’s in it for me?

 

Well, with serviced accommodation becoming more popular, the prices charged per night are comparable to guest houses and hotels nearby. When you compare the income generated through a typical buy-to-let where your property is rented out to one tenant long term for say £800 per month in comparison to renting your property per night for £60 a night in low season to £120 a night in high season, you can see why many investors are leaning towards serviced accommodation. It doesn’t take many nights of renting your property out per night to overtake the traditional buy-to-let rent. 

 

So why doesn’t every landlord switch to serviced accommodation?

 

There are some considerations when looking into serviced accommodation. As we mentioned earlier in the article, you are technically running your rental property as a mini-hotel. I spent some time with Clare Halliday of Refreshing Scotland, an AirBnB management company, and we discussed some of the challenges of running serviced accommodation.

 

Bookings: You will need to advertise your property on multiple different websites to ensure it can be booked by a range of guests from holiday goers to corporate business clients. You need to create a listing and upload photos and reply to any questions or enquiries you receive through the various platforms.

 

Changeovers: You are running your rental property as a hotel; therefore, you will need to get the property changed over between guests. Linen will need changing, the whole place will need to be cleaned from top to toe, and you’ll need to replace consumables (toilet rolls, toiletries etc), take bins out, and check for damage or repairs.

 

Check-ins: Guests will arrive when it’s convenient for them; therefore, you need to make arrangements to let them into the property, or use a key safe. Remember, no matter how simple you make instructions, there will be the odd guest who struggles to enter your property. Imagine a late-night call from a guest who has been for dinner and a glass or two of wine asking you to help them enter your property at midnight (or later).

 

Furnishing: While you could technically buy a rental property and put in any old furniture, the price you can charge per night for guests to stay will be higher if your property is kitted with higher quality furniture. From Clare’s years of experience in property management, she recommends picking a few statement pieces of furniture to give your property a luxurious feel and make your property stand out from other similar properties, which will attract attention to your property and likely increase your bookings. High-quality fixtures and fittings will withstand the test of time too, so spending money on quality furnishings upfront is a double win.

 

Location: Location location location. It’s something that all potential investors or current landlords must consider when researching property to buy for serviced accommodation. If a property you’re looking to purchase or currently own is located in a rural location, it can be more complicated to manage as serviced accommodation. One particular sticking point for managing properties in rural areas is the availability of laundry services for all the bed linen you’ll need if your property turns over every night. 

 

As you can see, there’s a lot to organise with serviced accommodation. For many landlords, this would be too big of a time commitment. It’s pretty much the same as running a bed and breakfast, without cooking breakfast! So you’ll now be wondering how anyone manages to have serviced accommodation without being full-time in property. This is where serviced accommodation management companies can be worth their weight in gold. 

 

Many AirBnB management companies can manage your AirBnB for you, but be warned, do your research as they’re not all as good as each other. These companies take care of all the bookings, all the cleaning and bed linen, and can be around 24 hours per day to deal with any guest issues. This service, of course, comes at a price but for many AirBnB landlords, this is an essential cost for running the property as serviced accommodation. Most AirBnB management companies will charge you a percentage of a night’s stay to run your AirBnB for you, anywhere between 12.5% and 20%. This is where number crunching comes in, as the numbers need to stack up to ensure running an AirBnB will make sense financially if you decide to take on an AirBnB management company. 

 

Clare Halliday of Refreshing Scotland runs a five-star AirBnB management company. Refreshing Scotland has everything in-house, from their management staff to their cleaning staff. They take care of everything for you and pride themselves in getting five-star reviews for every AirBnB they manage. Refreshing Scotland is in a class of its own. They provide hotel standard services for their guests and offer bespoke services tailored to each landlord’s requests; for example, premium quality skin ranges to putting specific food and drink items in the kitchen for guests arriving. A service like this is invaluable, so I’ve shared a link to Refreshing Scotland’s website at the end of this blog.

 

Serviced accommodation can be a fantastic property strategy if it’s executed correctly. If you’re considering purchasing a property or converting an existing property into serviced accommodation, ensure you have crunched the numbers and have thought about the logistics, as there are a lot of moving parts. You need to ensure that if you have a mortgage on the property, it allows for short term lets and that your insurance covers the short term letting of your property. Be mindful of local council legislation and whether you need to apply for a change of use of the property to allow short term lets. 

 

As discussed above, if you are looking for a fantastic AirBnB management in East Central Scotland then look no further than Refreshing Scotland. Clare would be delighted to hear from you and discuss your requirements.

 

https://www.refreshing-scotland.co.uk

Phone: 07908 469 505

E-mail: clare@refreshing-scotland.co.uk

 

We hope you’ve found this article helpful in sharing some of the positives and some of the challenges with serviced accommodation. If you’re interested in investing in property but don’t have the time, knowledge or know-how, then click the button below to book a call with me.


The Importance of a Property Exit Strategy

The Importance of a Property Exit Strategy

 

We’re all aware of what’s going on in the news at the moment. With a general election coming up quickly, Brexit and other financial industry uncertainties, many of us have thought about how this will impact the property market.

 

This blog discusses property exit strategies if the housing market shifts after purchasing a property. An exit strategy is about the financial plan for a property and will be specific to the property and your financial situation.

 

There are many factors in property investing that are within our control for example where to purchase, type of property, negotiating the purchase price, managing the process from conveyancing to the refurb, but not everything is within our control. If the property market changes, we need to make sure we have thought of exit strategies.

 

We need to be smart with our numbers when thinking about investing in property. All wealthy property investors will tell you that you make money when you buy. Therefore when you are looking for a property to invest in, start with the numbers, and make sure you don’t pay over the odds for a property. Cost up all renovation work, legal fees, stamp duty etc. to get a figure for total costs involved in buying a specific property. We research the current market in the area we are looking to buy in to estimate our end value. Look for properties for sale, under offer and sold within the past 12 months to get a feel for the end market value. We always err on the side of caution with our end value and keep it on the lower side of recently sold properties. With the end value in mind, we take away our profit margin and all costs associated with purchasing and renovating the property from the estimated end value, to calculate our maximum purchase price. 

 

The calculation above helps decide a fair price to offer if you’re considering flipping a property. That might be the initial plan, but we like to dive a little deeper. We always ask ourselves: if for some reason the property market dropped or the property didn’t sell, could we sacrifice some of our profits and still sell the property without making a loss, or could we hold onto the property? Spending some time researching the area you are looking to invest in will go a long way when it comes to the second strategy. If you needed to hold on to the property while the market comes back up to the level you bought at, how much could you achieve in rent and what is the rental demand in the area? We ideally like to work out the yield of the property, which is the total annual rent divided by the purchase price (or estimated end value if we’ve completed renovation works), to ensure the deal still stacks up. This will give us two more exit strategies: hold on to the property and pay down the mortgage with money from rent, or rent the property until the market picks up and sell once we know we’re profitable.

 

Deciding on an exit strategy is important when considering buying a property as an investment. We always make sure if we’re planning to flip a property, do the numbers still work if we needed to hold the property and rent it out. Other property strategies that could be considered are HMOs or serviced accommodation (AirBnB). We wouldn’t normally crunch the numbers for either of these strategies unless our first couple of options were not feasible. Normally if a property is suitable for an HMO or AirBnB it would be the main strategy and the property would’ve been bought with this in mind. Both of these strategies can be very lucrative but require experience, and a bigger time and monetary investment.

 

If you’d like to get into property investing but don’t have the time or knowledge, book a call with me using the button below to discuss how I could help you on your journey.


Moving House To-Do List

Moving House To-Do List

 

Moving House is classed as one of the most stressful experiences in life. So why would anyone do it? Many of us buy our first home and eventually outgrow it. For whatever the reason for moving, it can still be incredibly stressful. We have moved home many times, and we have found that being organised can make the process much less stressful. We’ve compiled a summary of big and small tasks to remember when moving home.

 

Starting packing early

If you haven’t moved home for many years, you will have likely forgotten what a big task this is. Packing your home can take weeks, if not months. So start the process as soon as possible, including a good clear out of any items you no longer need. The bigger the clear out you do before you move, the easier the unpacking will be at the other end. Like us, if you hate packing, book a company as soon as you can to pack and move your belongings for you. It comes at a cost, but we factor this into our budget when moving home as an essential fee.

 

Redirect your mail

When you move home, don’t forget to redirect your mail. Organise this before you move to ensure your mail will be forwarded to the correct address while you notify everyone that you’ve moved. The Post Office offers a mail redirect service at a small cost for six months (or longer) while you get yourself organised.

 

For any drivers

Make sure to update your drivers’ license with your new address. It’s an offence not to update your drivers’ license, so make sure to tick it off your list once you’ve moved. Your car insurance will need to be updated to your current address as it may be invalid if the provider has your old home address. Any motor vehicles will need to be registered to your new address too.

 

Utilities 

On the day you move out, take meter readings for gas and electricity. This will allow you to settle up your account(s) on the property and ensure the buyer of your home will pay the bill thereafter. 

 

Internet

Many of us can’t live without WiFi, and depending on your phone network signal in the area; WiFi could be vital at your new property. It’s worth contacting your current provider early on to see if they can move your existing account to your new address. This will save time and hassle. If you need to change supplier, it can take a few weeks, so getting this organised early avoids any disappointment.

 

Multimedia

For many of us moving home will also mean organising your TV licence and Netflix Sky etc. Similar to moving your broadband, call your current media provider to see if they can directly switch it to your new property. Although sometimes forgotten about, make sure to change your TV licence to your new property too.

 

Council Tax

Notifying your local Council that you’re moving is highly important. Some Council’s allow you to do this online, which can be more time-efficient than handling this over the phone. If can also let them know where you’re moving to and if it’s within the same Council you can inform them of your new address. 

 

Insurance Policies

You’ll undoubtedly need to spend a bit of time sorting out various forms of insurance. The insurance you have on your current home may be suitable for your new property, but remember we need to ensure both building and contents. These are sometimes with the same provider or in the same policy, but if you live in a building that’s shared, you may need to discuss communal buildings insurance with the provider or buildings factor (if applicable).

 

Your health is your wealth

If you’re moving more than a few streets away from where you currently live, you may need to inform your local GP surgery and Dental Practice in case you fall out with their catchment area. Once you’ve moved, you’ll need to register with new practices. 

 

Vote

Last but by no means least, ensure you register to vote at your new address. This is something that’s often missed during the home moving process but can be incredibly frustrating if an election comes round and you aren’t registered to vote. Don’t miss out and get registered.

 

We hope you’ve found this article helpful in listing many of the important things to consider when moving house. We are currently in the process of moving ourselves, so it seemed sensible to detail the process for individuals who haven’t moved in some time.

 

If you’d like to get into property investing but don’t have the time or knowledge, book a call with me using the button below to discuss how I could help you on your journey.


Buy to Flip: Top Considerations

Buy to Flip: Top Considerations

 

We’re all guilty of doing it. Browsing through Rightmove or Zoopla and finding a home in a good area for what seems like a bargain price…where’s the catch? The old ‘property could do with a degree of modernisation’ from the estate agent’s description gives us a clue. Then you take a look at the pictures and realise the property needs a lot of work. But if you still find yourself interested, then let’s think about whether this could be a suitable property for you to buy and renovate (and possibly sell for profit).

 

Here are some of our top considerations before considering renovating a property.

 

Number crunching: 

We are all familiar with what we can borrow from the bank to purchase a home, but when considering a property that needs a degree of renovation, this cost will need to come from your savings (after your house deposit is paid). However, you may save a little on stamp duty due to the reduced purchase price. 

And while we can estimate costs such as kitchens, bathrooms, flooring etc we need to remember that unexpected expenses arise too. Expensive repairs can include damp work, roof repairs and windows need replacing. You might also need to rewire the electrics or replace the heating system, but this shouldn’t be an unexpected cost. Some renovation experts in the industry advise calculating all your expected costs and adding as much as 20% extra for unforeseen expenses.

Costs that can be anticipated are for fees involved with individual professionals needed during the renovation works, such as additional surveys or advice from an architect. 

It’s important to mention that borrowing money from a lender isn’t guaranteed for all properties. Occasionally properties are classed as unsuitable for lending, which would mean any purchaser would need to pay for the property outright in cash, and may struggle to get borrowing in the future. Often if a property is not suitable for lending, it will specify this in the estate agents description, or may state only suitable for cash buyers. 

 

Time to view the property:

You may want to view the property yourself initially before thinking about taking an expert round with you. If you are considering a big renovation project, it would be wise to take along a local builder and/or building surveyor to a viewing to help you get a sense of the renovation costs, and whether there are any costs you may not have identified. Surveyors will likely charge you for this ‘walk round’, but the advice can be invaluable if they identify something you’ve missed. 

Another key professional to discuss your next project with is your estate agent. You can discuss exactly what you plan to do to the property, for example, renovate and extend to get a feel for the end market value. From this end market value, you can work backwards to ensure your renovation costs and purchase price seem sensible, ensuring you are making a profit on top of all expenses. A wise estate agent once said to us ‘you don’t want to be the most expensive house on the street’ and we have stuck by this rule. If your renovation work will add massive value to your property but also make it hugely expensive in comparison to other homes on the street, you may want to reconsider your project.

 

Getting your purchase price spot on: 

Once you’ve factored in all costs and decided you’re in the financial position to go ahead with your project, surely it’s time to take the plunge? Think about the following points before proceeding: 

  1. Are you going into this project with your eyes wide open? Projects don’t often run on time, so are you willing to potentially live in a building site for months or years. Have you thought about weeks or months with no bathroom or kitchen?
  2. The costs for your project will undoubtedly run over, have you factored in extra funds to cover this? And will you still be financially safe if your calculations are a little bit off?
  3. Is it your dream home, or are you financially driven? Sometimes we can get caught up with the figures and see only the profits. If the house could be your dream home, you might be happier with the decision than if it’s purely financial.

 

Don’t forget planning and regulations: 

If you’re planning on extending and significantly remodelling, it’s vital to get an Architect on board early to guide you through planning and any regulations. Your local Council website can give initial guidance on whether you will need planning permission for your building works, but moving forward, you will need an Architect to draw up plans and submit these for planning. Something incredibly important when it comes to planning is whether your new home is a Listed Building and whether it’s in a conservation area. Both of these designations can dictate what, if any, alterations or buildings work you can do to your new home. 

We hope you’ve found this article helpful when considering taking on a renovation project. We’ve completed a few renovation projects ourselves over the years, and each one has been a totally different learning experience. 

If you’d like to get into property investing but don’t have the time or knowledge, book a call with me using the button below to discuss how I could help you on your journey.


Fundamentals for Successful Property Investing

Fundamentals for Successful Property Investing

 

Many individuals starting on their property journey quite rightly begin by doing some research online. Some even buy property publications or books, and some attend local property events. On the other end of the scale, some individuals dive into the deep end and snap up their first investment property without too much research. Our journey has been shaped by a bit of both! We started our property journey by purchasing our first buy-to-let and luckily didn’t go too wrong. From there, we have learnt from on the ground experience, but also meeting with individuals in the industry who have beaten the path before us. We’re going to share some of the fundamentals that all successful property investors have in common.

 

1.Make a plan and stick to it!

One of the foundations of success in property investment is to have a plan. Firstly think about the end goal, and where you would like your property journey to take you in terms of cash flow or growth of equity. From the end goal, work backwards to create achievable shorter-term goals. Creating a business plan of sorts will help keep you on track to your goals and reduce the risk of you losing traction. Ultimately a plan can help you reflect on your journey and appreciate success along the way.

 

2.Build a good reputation

Being a new property investor in a local area will help you build a network of other local professionals within the region. Building a network of trustworthy people is worth its weight in gold, and growing this network will pivot around whether you are an honest and ethical investor. If you make a wrong move or let someone down in the industry, your reputation will be tainted quickly. Just remember the phrase about Karma being a … . 

 

3. Knowledge is power

When you’re first starting out as a property investor, make sure you spend time developing your level of knowledge of the industry. This can include knowledge of your local area and the market, mortgage rates, tax regulations, government regulations and building rules. This will help you make wise decisions when it comes to investing and will save you money, so prioritise building your knowledge. 

 

4. Get your ducks in a row

We advise you to find a good accountant and pay for their services from the outset. As a new property investor money in vs money out can make or break your new venture, therefore make sure you pay to get the best advice. An accountant will be invaluable for you moving forward as they have extensive knowledge of tax laws and acceptable expenses, and they’ll pay for themselves many times over in the tax you’ll save you. 

 

5. Teamwork makes the dream work

A successful property investor never claims to be an expert in all aspects of property. All property investors need to lean on experts in the industry, for example, conveyancing solicitors, tradespeople, estate agents, letting agents to name a few. A carefully selected group of professionals who can advise on any given project will make or break your success. So remember the phrase: teamwork makes the dream work. Start building your team of experts in the industry early on. 

 

6. Risk vs Reward

While many investors look at property as a way to make big bucks, we need to always remember property can also come with risks. Think big wins, and big loses. Property is known as a method to grow wealth over time, so keep this in mind when starting out. Invest wisely: buy right and ensure you have a team of experts around you to support you on your journey. Complacency can be a killer, so be fully equipped with knowledge of all the risks involved.

 

By following the fundamentals we have discussed above, you’ll give yourself the best chance of long term success in property investment. If you’d like to get into property investing but don’t have the time or knowledge, book a call with me using the button below to discuss how I could help you on your journey.