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So you want to make money from property? One of the best ways to do this is buying land or a project and developing it, but it's not easy to do, it takes time, a lot of expertise and it's risky, especially if the market goes south.
|John Howard is an extremely experienced property developer who has ridden many property market ups and downs - unlike the many so called 'property gurus' who have often gone bust or owe the banks or private individuals money.|
|Here are his 'Top 15 property development tips' to get you started:|
1. Don't start with a 'deal'. First you need to learn what you can and can't do, whether it's a small or a large project:
When can you use permitted development rights?
Are you likely to be working in a Conservation area - what are the restrictions?
Are the planners development friendly or not?
What building regulations will be required?
|2. Understand the Local Plan - by law each Local Authority has to have one. It explains what homes are wanted and needed and highlights where they are planned to be built.|
|3. How long are planning approvals taking in your area?|
|4. Renovation projects need to drive 20% profit - can you make this stack up in your area?|
|5. Self build/bigger projects should be delivering 30% profit - how achievable is this?|
|6. Be realistic about the costs of a project, don't under estimate costs and over value the property. Don't assume you can sell at a higher price than anyone else has done before.|
7. Can your project survive a 20% fall in prices? Can you let it if you can't sell?
|8. Find an architect that has successfully worked with the Local Authority on similar plans and ideally overturned rejections on appeal.|
|9. Find local builders and understand their timescales - the good ones may be booked a year in advance, understand their payment schedules and insurance.|
|10. Understand what national/local resources are available to find projects eg Plotsearch, or if you want to build your own home, your Local Authority must consider your request via a Custom Build Registry.|
|11. Find a local surveyor to work with to help you with valuing land/projects and renovation/build costs.|
|12. Check out what access you have to development finance. How long are the loans for? What will it cost?|
|13. What if the project takes longer or you need more finance? What checks will you need at each stage to release the next phase of finance funding?|
|14. Is there any government finance available?|
|15. What insurance will you need - for the site and for the build? What will the costs be?|