Getting your foot on the property development ladder can be a tough cookie to crack. There are far too many considerations for one person to think about, and the amount of effort, time and money it takes to even obtain your first property can be incredibly daunting. However, for those that manage to get their foot in the door, it opens up a whole new world of financial possibilities and, in most cases, it’s worth every single bit of effort you put into it.
The first thing you should understand is how to start your first property development. Assuming you’ve saved up all the money you need and have contacts that can assist you with getting your property on the market, then here are some considerations to make in regards to buying, building or renovating your very first property.
Buying a property
Buying a home either for the sake of reselling or to rent out is the most basic choice because it takes the least amount of time of the three. It is, however, arguably one of the more expensive options because you have to straight up purchase a home in order to be able to resell it or rent it out to potential tenants. However, you can often get some fantastic deals if you’re an early bird and manage to buy a property or two in a large development project such as a luxury apartment complex. Some of these investments work like trusts; you pay upfront for a property and contribute to the development project, and the company that handles the build manages the rent and everything else. All you do is agree to their terms, allow them to take a handling fee and then you simply sit back and let the money roll in. This is arguably the least effort despite being the most expensive, but it’s almost guaranteed to get you a return on your money assuming you take the necessary precautions to safeguard your money.
Building a property
The next option is to build your own property. This will involve hiring architects and buying a large plot of land to fit your design. This takes arguably more money than simply buying a property because there are more people involved in the overall project. However, this does offer far more control than simply buying a property or just renovating some place. You’ll need to keep a lot of things in consideration so it’s best to get your architect on board as soon as possible. This means you’ll have a trusted advisor to guide you as you go through your designs and plan your structure. You’ll need to do a lot of research on what types of homes are popular in your chosen location and how to make the most of your building materials. You shouldn’t use cheap materials that could cause an issue with the structure in the future, but you also shouldn’t overestimate the worth of your property and use luxury or premium materials that will needlessly bump up the price. You’ll also have to think about interior design. If you’re not too experienced with design matters, then you might need to hire an interior designer to help you work out the best colours and decorations to use for your property, further increasing the cost.
Renovating a property
The last option is to simply renovate a property. This is perhaps the cheapest option of the three because there are many people out there who are willing to put their properties in the hands of experienced property developers that can increase the value of their home. Renovation usually means fixing up the structure of a home and doesn’t necessarily refer to just the interior design. However, it’s a good idea to remember that you’ll need just as much experience and advice as you would when you’re building your own home. It takes a lot of work stripping out a home of all of the existing furniture, which means you’ll need to hire someone if you don’t want to get your own hands dirty. Before you invest money into a renovation project, make sure you understand what you’re getting yourself into. For instance, if the property looks tacky, cheap and uncared for, then you need to value it based on your own judgement. Is the area good? Are there local amenities? What are the chances that this property will sell? These are things that you’ll gradually learn as you build up experience, but it goes without saying that despite renovation being the cheapest option, it’s also one that can backfire the hardest.