Many of the world’s richest people have achieved their wealth through property investment so it’s not surprising that many have tried to follow in their footsteps to start a career that has proven to be lucrative for so many. Before you begin, you might want to read our quick guide to make sure that you’re aware of some of the potential risks you might be taking with the property industry.
- Clear all debt first
If you’re looking to establish a career in the property industry it is vital that your finances are in the best shape they can be. Clear yourself of any debts such as unpaid bills and loans before you begin your search for a property.
- Know the commitment you have to make
Property investment is incredibly time-consuming and can be very hands on if you don’t fork out for a property management service. Finding your ideal property and securing the purchase is only the first step. After that, you’ll have to find reliable tenants, deal with maintenance issues, collect and keep track of payments and keep on top of legal issues that may arise.
- Don’t plan on fixing up
When you’re looking for properties to invest in it’s tempting to go for a bargain that needs work. Unless you are or already have a contractor who you know will give you a good deal for high-quality work, this may not be the best idea. More often than not, investors who do this pay more money renovating the property than they gain from renting it out. The tip is to look for a property that only requires minor repairs.
- Research the market first
Understand the advantages and potential risks of a career in the property industry before you commit to it. If you know anyone who is already in the buy-to-let business, ask them for any advice that they may have for you and keep track of the state of the housing market, so you know when there is a high demand for property in the area that you own. Professional property management services such as Flambard Williams can offer their expertise as you’re starting out.
- Understand your target market
The best way to ensure you’ll get tenants for your property is to establish and stick to a target market. Many property investors focus on providing accommodation for students and young professionals as there are many cities throughout the UK that regularly see a great demand for property that suits these types of tenants.
- Take risk into account
Never ignore the things that could go wrong with property investment. Sum up your finances and have a plan in place if your property is unoccupied for a number of months. There could be a sudden drop in the property market that would mean the value of your investment would decrease and if there were a major repair that is not covered by insurance, would you be able to cover the cost? A contingency fund could be a sensible idea for instances such as this.