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Please find our collection of 'Property Investor Guides' below. The sections below contain advice, guidance and general information from some of the industry's finest minds. Wether you're a first time, or seasoned investor our guides conatin a welath of free information to help you get the best return on your property and real estate investments:
More and more people are adding UK and international investment property to their portfolio of savings and investments in the form of buy to let. Buy to let is changing the way we think about financial planning and is an excellent way to guarantee an income and increase your capital assets.
With half of all Londoners renters (49%), this is the highest geographical area for renting in the UK. The market for rental property is flourishing and so is the but-to-let trend.
Historically, borrowing on income-producing property has been viewed by lenders as a commercial proposition. So, mortgages on property to let, even for private individuals, have attracted higher rates of interest than the standard mortgages offered to owner-occupiers.
In addition, until now, rental income has usually been disallowed when assessing a borrowers ability to meet mortgage payments.
Now, the view of many lenders and all other housing professionals is that growth in the private rented sector must be encouraged. Not only does it lag well behind the private rental sectors of all the other advanced economies, the lack of choice between renting and buying is, in fact, bad for the economy and a contributory factor to the booms and busts of the housing market over the last decades.
But, the change in lending criteria and the lowering of interest rates for private investors has only been made possible by the strong presence of professional, bonded letting agents in the lettings market.
Gross returns - the rent received before taking account of the cost of letting - such as management fees, maintenance, service charges ground rents and insurance varies between 7% and 10%. This can be less for very expensive properties.
The average rental return in Britain today hovers around the 10% mark, and capital appreciation is likely to match, if not exceed, inflation for the foreseeable future.
As a rule of thumb, the gross rents should be between 130% and 150% of the monthly mortgage payments.
What difference does a Letting Agent make? Buying a property to let is not the same as buying your own home. Mortgage lenders will want to know that an ARLA member agent has been advising on the selection of properties suitable for letting.
The experienced agent will know the local market, whether there is a demand for say, two-bedroomed flats, or four bedroomed houses, or for properties close to schools or transport links or secluded properties with gardens. Also the agent will know the standard of decoration, furnishing, fixtures and fittings required.
Then there is the selection of well-covenanted tenants who will pay their rent on time and leave the property on time and in a proper state; and there is the management of the tenancy.
Knowing that the management of any inherent risk is in the hands of a professional agent enhances the creditworthiness of Buy-Let propositions put to mortgage lenders.
Armed with suitable advice from an ARLA letting agent, Buy-to-Let investors can start on a property search; or a letting agent may do this for them, instruct their own sales department or work regularly with the best estate agents in their area.
Once a property has been found, the letting agent will confirm whether or not it has letting potential, the range of the likely rent that can be achieved in current local market conditions and advise on the need - or otherwise -for re-decoration and new fixtures and fittings to attract good tenants and to reduce the risk of lengthy void (empty) periods.
How are mortgages arranged through the Buy-to-Let initiative? Broadly, there is little difference between arranging a Buy-to-Let mortgage for investor landlord's and a standard mortgage for owner-occupation. Buy-to-Let mortgages are subject to the usual status checks. Loans can be arranged for terms of between five and 45 years and for up to 80% of the value of the property.
Through the Buy-to-Let initiative, rents achievable from an investment property can be taken into account, provided an ARLA member agent is to be responsible for letting and managing the property.
An ARLA member will introduce and vet prospective tenants; prepare the tenancy agreements; advise on and arrange inventory and condition reports and changes to utility accounts and Council Tax; collect the rent and pay the balances to the landlord's account.
A letting and property management agent can also pay bills on behalf of the landlord and regularly inspects the property, recommending, overseeing and accounting for necessary maintenance, repair and re-decoration.
Generally, lenders will expect landlords to use an ARLA member to let and manage the property and for rental agreements to be drawn up as Assured Shorthold Tenancies or other contracts as appropriate.
Insurance cover is now available for rental protection, in the event of a defaulting tenant, and for legal expenses in addition to the normal building and contents insurance.
Letting agent's commission and management fees, Insurance (Building/Contents/Rental and Legal Expenses Cover), the costs of keeping the property in a marketable condition, service charges and ground rents - if a leasehold. (The tenant is responsible for such items as utility accounts, Council Tax and TV licence fee etc.)
Deductions against tax on rents received may be claimed for the costs of maintenance, such as insurance, cleaning, gardening, agent's commission and other reasonable management expenses (but not improvements).
The initial cost of furniture fittings and fixtures is not allowable, but the actual cost of subsequent replacement may be claimed; or, alternatively, a wear and tear allowance of 10% of the rents received may be deductible.
Information Source: ARLA
Just because real estate prices seem to have hit a temporary ceiling in many countries around the world, that doesn't mean that profits from property investments are hard to come by.
Even during a real estate market slowdown, stagnation or depression profits can be made locally and overseas. This article shows you the top ten tips that real estate investors apply to their property portfolio building strategy to ensure success from their investments.
It's a story that is recounted in thousands of dinner parties up and down the country every weekend. It usually begins three or four years ago with a young couple looking for an affordable first home. They move into a cheap but slightly down-at-heel area and likeminded couples follow suit. Bars and restaurants open up to cater to the new inhabitants of the area, property prices start to rise and before you know it, our hero and heroine find themselves living in a minor property hotspot with a home that has doubled in value.
For those who've bought into an area that has stayed resolutely down-at-heel, such tales tend grate on the ear - although such places these days are few and far between. For housebuyers in search of an inflation-beating property investment on the other hand, they're the stuff of legend. And the big question that keen listeners will be asking themselves is: How on earth do I buy into a future property investment hotspot?
"Finding the next property investment hotspot is probably the single most difficult second guess you can make," says estate agent Graham Harris. As a professional with several decades' experience of watching the London property market and a former president of the National Association of Estate Agents, Harris is an old hand at the game of spotting future hotspots. But even he admits that when it comes down to it, backing a property winner is as tricky as predicting which nag will be first past the post at the Grand National.
"It's often the case that these things happen by chance and everybody is caught by surprise," he says. "Either that, or it's so obvious that you'll kick yourself for not noticing it earlier."
So does it all happen by chance? "No, there are market readers, people who can see what's going to happen and get in ahead of the game," he says. "Sometimes they can even create an up-and-coming area by investing in services or amenities. "Tube lines and transport links can hugely change the nature of an area and you could also add trendiness to the equation. Some areas might not appear too appealing at first sight, but if it's lively with lots going on, people will want to move closer to it."
Another factor that can work in a place's favour is the nature of its building stock. Warehouses might lend themselves quite nicely to residential conversion.
First, a future property hotspot is likely to be within the catchment area of good schools. Some estate agents swear by the magical effect of the school league tables and it's certainly true that parents will pay a premium to live within a select catchment area. Whether you can predict a future league-table topping school is, of course, another matter.
Second, fast-selling areas are often visually appealing, according to the BBEA - particularly out-of-town areas that appeal to jaded city dwellers after a rural bolthole.
Third, good road and rail links invariably boost property values in their immediate area, especially if they mean that the area is now within commuting distance of big employers or urban centres. For the best chance of success, make sure you know what's going on with your area's structural plan, and scan the local press for news of big planning decisions.
Similarly, keep an eye out for news of big employers moving into an area. A government department or a big national headquarters could bring thousands of new employees with it - and they'll be looking to buy as close to work as possible. To get ahead of the game, find out who your local council is trying to tempt to the area, and where they might go. But bear in mind that as with any type of speculation - whether on the stock exchange or down at the dog track - things don't always turn out the way you expect them to.
"It's a very, very difficult business to guess," says Graham Harris. "You've got to be a certain type to do it. Pioneers who buy into an area before it's popular can make lots of money, but it can also be very costly. What goes up can also come down." If you're really determined to introduce a little speculation into your home-buying activities, Harris has what could be the best piece of advice you'll get. "My own personal advice would be to pick somewhere you'd be happy to live," he says. "If it's good for you, it's likely to be good for people like you - and that could mean more people moving into the area and boosting prices." Even if those prices don't rise, at least you'll be somewhere you want to be - which may well be the most important thing in the final analysis.
In recent years there has been a boom in overseas property investment with more and more people taking advantage of favorable exchange rates coupled with lower property prices abroad.
Before you start looking for a investment property overseas, it's worth asking yourself a few basic questions, which should save you time and money in the long run:
If you're relocating abroad, take a look at the Practicalities checklist from Fresh Start to help you get organised for the big move.
Use qualified professionals to protect your interests and make the overseas investment property purchase a stress-free experience. Estate agents are a good source of advice. Only negotiate with ones that are officially registered and hold a licence. Ensure you have a good lawyer with an excellent command of English and the native tongue, to deal with the endless stream of rules and regulations. For instance, did you know that if you're buying in Spain you'll need to make out a will in Spanish before buying, or that you can inherit debts from a previous vendor?
Research all legal issues and costs involved. Your solicitor/lawyer will advise and assist you. Before you have decided on a property it's important to be fully aware of the legal process and costs involved in purchase of your investment property overseas. Obtain professional advice and check your finances, taking account of these additional costs.
Be well prepared with your finances; taxes can be high when buying. Set up a direct debit from a native bank account to pay for bills. Be careful not to miss payments and read those red letters; foreign banks are not lenient with those who don't pay up in time. If you're considering renting out the property when it's empty, bear in mind that advertising in the UK for a property abroad could result in tax demand from both the English and foreign authorities.
Make your offer in writing if possible for the overseas property (of course, subject to contract), and include not only the price, but also the amount of deposit, when you're prepared to pay it, when you're prepared to complete, what you understand to be included in the price (for example furniture and fittings if applicable) and, an often neglected point, that all machinery equipment and installations are in normal working order.
Spain's pleasant, healthy climate and wide selection of properties make it the most popular destination for an overseas property. Choose from developed plots, farmhouses and village locations, through to villas, townhouses and new apartment developments.
A finca is a plot of land or an estate outside of or in-between towns and villages. Properties advertised as fincas can run from tumbledown farmhouses to lavish modern villas. An advantage is that fincas generally come with a substantial amount of land, which may include olive groves and fruit orchards. Residency
If you wish to spend more than six months in Spain you need to apply for a 'residencia' to become a resident. Being a resident doesn't restrict movements in any way and it has many advantages, such as lower taxes. If you don't become a resident you must appoint a fiscal representative.
It's highly advisable for any person who has a property in Spain but doesn't live there all the time to nominate a fiscal representative. This is a person to whom the tax authorities can send all correspondence relating to your affairs in Spain, secure in the knowledge that it will arrive. The fiscal representative must be resident in Spain, but it's for you to choose whom to appoint. It can be a friend, neighbour, lawyer or tax adviser.
For facility management you can appoint a local gestor or legal representative. This person is the official form filler who does the work for quite reasonable charges. If you decide to live or work in Spain your gestor can assist you with residencias, work permits, licences and permits in connection with the opening of new businesses. They'll also advise on importing cars, furniture, electrical goods and pets into Spain, obtaining payment of your pension in Spain, national insurance and other related matters.
Ask your estate agent for details of the outgoings payable every year to maintain the property:
Applying for a mortgage is a straightforward process, as in the UK. A number of documents must be furnished to the Spanish bank in order to accommodate a smooth transaction. Please not that originals of everything will need to be shown and copies will be taken at the bank.
If you plan to move the whole family abroad, your children's education is highest priority. You can choose from international, state and private schools.
Contact the National Association of British Schools in Spain for information. Website: www.nabss.org Or phone Spanish Education on 020 7727 2462.
No longer happy with a traditional two week vacation in the sun there are lots of Brits who make their holiday a little more permanent.
Obtaining a visa that entitles you to live and work in a different country is far from being a straight forward process.
Most countries have numerous categories of visas or permits providing legal entrance and residence, all dependent on individual circumstances. It's important to apply for the one that will best meet your objectives.
Timing can be crucial. Countries often impose quotas to regulate the number of people arriving in the country. So your application could be turned down simply because you applied at the wrong time.
Even some of the most carefully prepared visa applications can be rejected for seemingly the slightest of reasons. Embassy officials are under no obligation to explain why an application has been rejected, so you could easily find yourself turned down without understanding why and unable to rectify the situation. Above all, it's important to realise that it is the embassy official's job to look for reasons to reject -not accept - your application! Also the success of your application may depend on the pass or pool mark in force at the time your application is assessed - not at the time it is lodged.
If you want to work in Australia, you will need skills or business abilities that will contribute to the country's economic growth. You will need to pass a points test, which will assess you on the basis of skill (qualifications and experience in your occupation), age and language abilities, amongst other factors. Good English is essential for most occupations in Australia, if you are to find a job to match your skills and qualifications.
Australian labour market conditions vary significantly from time to time and between regions. Each occupation receives a "Labour Market Rating", which is regularly reviewed by each State and Territory Government. Bear in mind that if you are willing to live outside major metropolitan centres, your application will stand a greater chance of success, because the Australian Government promotes a special scheme to help fill regional skill shortages
For many jobs in Australia, applicants must be eligible for membership of a professional or industry organisation and/or be able to be registered with an Australian state authority before they can work in their occupation. We will need to ascertain whether any such restrictions apply in your case.
Perhaps you would prefer to work for yourself, managing a business in Australia? If you have experience of running a successful business or substantial investment portfolio, or a track record as a senior executive in a large company, you may qualify on this basis.
If you do not want to work, then you may be eligible to retire in Australia, since it is one of the few countries with a specific retirement policy. You will need to be prepared to transfer some funds, as well as meet certain other criteria.
If you have any family connections in Australia, this could certainly help with your visa application.
If you do not reach the pass mark for acceptance all is not lost. Provided that you reach what is termed the "pool" mark, your application will be held in reserve for up to 24 months after it is assessed, in case a newer, lower, pass mark is set - or your circumstances change.
Be careful, though. The Australian Government varies the pool and pass marks from time to time in order to regulate the number of people arriving in Australia. You must reach the pass or pool mark in force at the time your application is assessed by the migration office, not when your application is lodged! So the timing of your application could be critical.
US immigration legislation can be bewildering for would-be migrants. You are faced with over 100 different kinds of visa to choose from - only one of which is likely to be exactly right for you!
Furthermore, most classes of visa are restricted by a quota, which limits the number of people that will be accepted each year.
The US permanent residence visa is known as the "Green Card", which identifies the holder as a permanent resident of the US. Green Cards in certain categories can be obtained fairly quickly.
In other categories, even if you have the strongest qualifications possible, it can still take months or years to obtain one because of quotas.
You can qualify for a Green Card through employment, although all categories are limited by quotas. You will need a job offer from a US employer and the correct background in terms of experience, training and education for the job you have been offered. The US government will also need to be satisfied that there are no qualified American workers available and willing to take the specific job that has been offered to you. Certain occupations - such as Nursing - may have special categories of visas which lead to Green Cards.
Your country of origin may make you eligible for getting a Green Card through the "lottery", a category that was introduced to encourage ethnic diversity in the US population. Or you could qualify for a Green Card through investment, if you are prepared to invest funds in creating a new US business or expanding one that already exists.
If you have family connections with the US, this will certainly help your visa application.
But a Green Card is not the only route to a new life in the US. It may be best to obtain a temporary visa first and then reconsider your long-term objectives once you are in the USA. You can then make a Green Card application if you want to stay permanently. There are numerous kinds of non-immigrant, or temporary, visas. Unlike Green Cards, which are identical once allocated, temporary visas differ from each other in the benefits they offer, as well as how long they last. Most importantly, your application will be processed much faster if your intention is not to take up permanent residence right from the start. Their dependent on your personal circumstances, emigration agencies may be able to identify other routes to gaining entry to the US, even if you do not wish to work.
If you want to work in Canada, you'll need a good education, as well as employment skills that are currently in demand there. We will need to ensure that your occupation appears on the Occupations List published by the Canadian government, which changes from time to time.
We will also need to show that you have met any trade or professional licensing requirements to follow your intended occupation in Canada. A job offer from a Canadian employer will dramatically increase your chances of success.
You should be able to communicate in either English or in French, to enable easy integration into the Canadian community. Over 98% of the population speaks either language - or both. Personal suitability will also be taken into account. This refers to adaptability, motivation, initiative and resourcefulness, which are considered essential to enable you to settle successfully in Canada.
Perhaps you would prefer to work for yourself. Would you consider establishing or buying your own business in Canada, or investing in a business or commercial venture over there? If so, you may qualify for business migration. You will, of course, need to demonstrate an ability to become successfully established in your occupation or business in Canada - as well as meeting many of the requirements outlined above.
Even if you do not want to work when you arrive, you may qualify for investment migration. The Canadian government is keen to attract immigrant investment to small and medium-sized businesses - even if the investors themselves have no desire to play an active role in the management of those businesses.
If you have any family connections in Canada, this could certainly help with your visa application.
Like most countries, Canada's immigration law is complex and much of it is based on units of assessment, which are awarded against each of the criteria that must be met. It is vital to ensure that you apply in the category that provides you with the best opportunity for a successful application.
If you want to work in New Zealand, you'll be assessed on a points system related to a range of employability factors, including qualifications, work experience and age. You will certainly need a good standard of spoken and written English. And you'll receive extra points if you have a genuine offer of employment in New Zealand!
It's not as straightforward as it sounds, though. Points for qualifications are allocated according to the New Zealand qualification to which your qualification is comparable, so we may need to obtain an assessment from the New Zealand Qualifications Authority. Also bear in mind that registration may be compulsory for your occupation before you can work in New Zealand.
Perhaps you are not interested in working for someone else. You would prefer to establish, buy or invest in a business in New Zealand. If so, you may qualify for business investment migration. This is also assessed on a points system, with factors such as business experience and investment funds taken into consideration.
Whichever you choose, up-to-date advice is essential because the New Zealand government recalculates the pass mark each week!
If you do not want to work when you arrive in New Zealand, you may still qualify if you are able to invest funds over there for a specified period of time. If you have family connections with New Zealand, this will certainly help your Visa application
Land Banking and Land Acquisition has been the territory of the Developer for many years, now that dominance is changing. Everyday investors are being drawn into this lucrative market by the promise of large long-term gains.
Land Banking as a form of investment offers the opportunity to ride rapidly increasing land prices over time without the need to put tenants in place to defray costs. Since no tenants are involved in land banking, this opens the possibility to making investments in locations that are far removed from where you live.
Land and Property has proven itself again and again to be a good way to invest your money, there is no surprise to know that most of the wealthiest people are landowners or at least have a healthy land bank in their portfolio.
It is estimated that the price of land in the UK has risen by over 600% in the last decade. In addition demand for well positioned land is very high and prices are rising steadily as the government keeps up its stance on creating more housing by changing planning permission on Greenbelt land.
It must be stressed that any speculative investment has some element of risk but simple economics dictate that when supply is limited land values will keep rising over the long term. Land banking that incurs the highest level of risk is speculative acquisition of Green land. This is simply land that is not designated for development. Although to a lesser degree, Brown Belt land comes with its own inherent risks. Make absolutely sure you do your research first.
In the past it has been very frustrating for people who have wanted to get involved in this type of investment. The need for large sums of money has excluded most small investors, but now there are many professional land banking & acquisition companies available to help budding land owners. Do your homework; this market sector is not currently regulated. Choose a Land Banking Professional very carefully as this is not a science and the stakes are high. There is absolutely no substitute for local knowledge, as you must obtain confidence that a change of land use will be granted in the near future. This is not a get rich quick investment, in many cases you must be prepared to wait for at least 6 to 10 years (if at all) for change of use to be granted by the local planning authority.
Engage the services of a specialist Land Lawyer to ensure you proceed correctly and manage your risks carefully.
Many first time buyers are dipping their toes into the high risk market of Property Auctions.
Property Auctions are a good way to save money and get the property you want. Bargains can be snapped up well below market price allowing the first time buyer to make that first move onto the property ladder.
If you are unfamiliar with Property Auctions we would recommend you do your home work and research carefully.
Be committed, be calm. Then go to work. Think Linda Hamilton in Terminator 2. No need for the guns, though. A wallpaper-stripper is quite sufficient.
Pull those purse strings so tight they twang! Your bank manager will love you. You will love you.
Learn to love your property development project. You may as well, because you won't be doing anything else until it's finished.
"Developing can be a great job and it is very enjoyable to create something you are proud of - but it is not a licence to print money any more than any other job," writes TV property expert Sarah Beeny in her book, Property Ladder.
Like any job, it makes sense to work out whether you're suited for property developing before you jump in at the deep end. If you can resist reaching for your wallet every time you see a smart accessory, then you could have what it takes. If you can also follow a friendly estate agent's advice that a luxury sunken bathtub won't appeal to the family market you're aiming for, then you're definitely on the right track. If you have the vision to take a derelict property and turn it into the sort of home that people actually want to buy, then you're almost there.
Next you need to ask yourself if you can put up with the following: leaking roofs, builders that go AWOL, awful weather, strained nerves, busted budgets, plaster dust, faulty fittings and filth. Filth everywhere. Filth when you wake up and filth when you go to bed. This can be the reality of a property development project, especially if you're living on-site while work is being carried out. If you can stomach this lot and stay smiling, then you're well on the way to being a property developer.
Are you a budget buster or a penny pincher? Stick to these rules and your dream development will stay on track.
A good budget is a budget matched to the property's true worth and potential. There's no point in slinging thousands at a two-bed terrace and turning it into designer heaven if the nearest trendy bar is 20 miles away. Wherever it is, every property has a "ceiling price" - that is, the maximum price a similar property nearby has actually sold for. It is unrealistic - and dangerous - to expect to exceed this price. For more on checking out the potential in properties, see Casing the Joint.
Most experts agree that you should be aiming to make a 20% profit on a redevelopment project. There's only one thing between you and your profit - a well-kept budget. Make it your business to know how much everything related to the project costs. Don't be afraid to ask builders questions about prices: ultimately, they'll respect a client who's in control. Once you know how much everything costs, it's far easier to spot when things are going awry in one area and to make savings elsewhere. Learn to differentiate between a good, professional finish and a finish that's needlessly fancy and expensive. Quality, plain fittings are just as good and will save you an awful lot of money.
Choosing the right finance package is an important part of your budget strategy. Today's mortgage market is pretty complex so consider hiring an independent financial adviser if you feel you need a hand. Visit unbiased.co.uk to find an independent financial adviser. For more about mortgages and house-buying, see Choosing a Mortgage. Make sure your finances are in place before you make an offer so that estate agents and vendors know you mean business.
Expect the unexpected - and make sure you budget for it. Colin McAllister and Justin Ryan nearly got burned during stage two of The Million Pound Property Experiment. Their Stratford apartment looked sensational when finished but unexpected costs blew their budget. They had to fork out £8,000 for new windows and £5,000 for work on the roof. As if that wasn't enough, an unforeseen plaster shortage caused delays that cost the boys £1,000. Always factor in at least 10% of the projected development costs to the total to cover unforeseen expenses.
Give those celebrity shagging stories a miss and get into the habit of reading the home finance pages in quality weekend newspapers. They review new financial products and they're a good barometer of the general financial climate. If interest rates are set to rise or fall, or if the housing market is about to experience a change, you'll read about it in these pages first.
Your mortgage lenders may charge a set-up fee and insist on insurance for the sum loaned. If they do, then add these figures to the total. Remember that the estate agent's fee (typically 1%-2%) when you sell the property is part of the total cost of the project. Any professional advice you pay for should also be included in the total. Finally, don't forget ongoing costs such as mortgage, rent, utility and council tax payments.
Feeling dizzy? You haven't even lifted a hammer yet! For a checklist of typical building costs, see Getting Your Hands Dirty.
Sometimes it pays to be a nosey parker
All the normal rules about choosing a good location apply to property development. Pleasant localities with sound housing stock, plentiful local amenities and decent transport links are generally a good bet. But you need to fine-tune these rules for different markets. Broadly, there are five types of buyer: first-time buyers; young professionals; young couples; growing families; and people who are retiring or downsizing once children have flown the nest.
Your chosen property's location should match the requirements of your target market. First-timers want up and coming areas - they can't afford anything else! Young professionals aspire to trendier districts. Young couples are beginning to look for quieter roads near nurseries and schools. Growing families need established residential areas with larger houses. Downsizers are seeking properties well served by public transport and local amenities.
Just as buyers want different things from an area, they have varying priorities when it comes to the accommodation itself. First-timers want good-value, unfussy living. Moreover, first-time sharers need evenly sized bedrooms with good storage and room for a double bed. Young professionals have more cash to spare and are willing to be seduced by "wow" factors like dramatic conversions, unusual features or luxurious fittings.
With young couples, the emphasis is on easy, child-friendly living spaces. Kitchen-diners and gardens are high on their wish-lists. Growing families need flexible accommodation with space to grow. Retired people are looking for compact properties, perhaps with labour-saving features like waist-level fridges and easy-to-use fittings.
When evaluating a property, you have to see past the accommodation immediately in front of you and visualise how development work - at the right price - could appeal to your target market. A tired but structurally sound two-bed terraced house might only require the creation of a contemporary kitchen-diner and sensitive re-decoration to make it appeal to a young couple at an attractive selling price. On the other hand, turning a completely derelict three-bed semi into a five-bed family home may not be possible at a price that would give you a decent profit.
Spotting potential is the fun part of sizing up a property - but don't let your imagination completely run away with you. "Do your groundwork first," warns experienced developer, Paul Speed from Norfolk. "Have a chat with the council planning and building regulations departments to make sure that what you want to achieve is possible and permissible."
Get to know the estate agents in the area you're interested in and immerse yourself in the details of their properties so that you're on familiar territory when you start viewing. Use the library, the internet and the local paper to dig deeper into the area, checking out school performance tables, amenities, future development plans and crime figures. Two things in particular to look out for when you're checking out an area is evidence of previous flooding and whether the property is underneath a flightpath. Neither are popular with buyers.
When you're starting out as a developer, you may not have enough money to buy in established districts. Here's a checklist of what to look out for in the up and coming areas often found near established centres.
The same applies if you're thinking about Buying to Let. Work out whether it really will generate more income than other forms of savings - and again, consider carefully who your target market is.
Source: UKTV Style
A pensions tax break which was due to be introduced in April will now not go ahead, the government has said. The chancellor has decided that Self Invested Personal Pensions (Sipp) will not be given immediate tax relief for investments in residential property.
The proposal had been widely described as a tax break for the rich, who could use a Sipp to buy a second home or items such as fine wine.
The plan was first announced in last year's Budget. It would have been introduced next April as part of a radical overhaul of all tax rules surrounding pension funds, known as A-day.
A Treasury spokeswoman described the new policy as "a proportionate response to an unintended consequence of simplification."
The original rules would have meant that high earners - who are subject to the top rate of tax at 40% - could have expected to be given a 40% rebate on the value of property (up to a maximum of £215,000) bought with their own cash using a Sipp.
The new tax rules for residential property bought through a Sipp will be rather different, although not totally prohibitive of using the pension to buy residential property.
A Treasury spokesman explained that money put into a Sipp would still attract tax relief. But if the cash was used to buy a house or flat then a 40% tax bill would be slapped on it.
In additon, once in the Sipp the 'prohibited asset' could be in line for further tax penalties eqivalent to 30% of its value. The Treasury said the aim of the new policy was to ensure that tax reliefs would only given to people genuinely using the Sipp to provide themselves with a pension.
The new policy will also apply to investments that are deemed to be "tangible moveable property" such as classic cars, fine wines, or works of art.
Last June, the Liberal Democrats claimed the proposed tax break would drain the Treasury of £2bn a year. On Monday, the Liberal Democrat Work and Pensions Spokesman, Danny Alexander MP, said: "The chancellor has left it to the last minute, but at last he has seen sense by preventing second homes being purchased with Self-Invested Personal Pensions. The idea that the government should give tax breaks for second home ownership always was absurd."
The market research firm Datamonitor had gone further and estimated that the cost in tax relief handed out would rise to £4.6 bn a year by 2009. Indirect investment in residential property will still gain tax relief.
The government made it clear that it will encourage and allow investment in a new type of investment vehicle, called a Real Estate Investment Trust or Reit.
Source: BBC News
The International Property Exhibition)
Location: Muscat, Oman
Date: 16 - 18th January
The International Property Exhibition will be held in Muscat, Oman as a successive event to last years Gulf Property and Investment Exhibition. This year's exhibition will specifically focus on Property & Real Estate as the new developed parallel event titled Money World - Banking, Finance, Investment and Insurance Show which will cover the Investment sector.
International Holiday and Overseas Property Show
Location: Norwich Show Ground
Date: 17 - 18th February
The International Holiday & Overseas Property series of exhibitions is set to double for 2007. Well known in each region of Bournemouth and Cheltenham as 'Interhol' they have been staged for the last 22 and 21 years respectively.
Location: London, UK
Date: 2 - 4th March
The Homebuyer Show is the UK's largest and longest running dedicated property event.
International Property Show Dubai 2007
Location: Dubai, UAE
Date: 3 - 5th April 2007
The Third International Property Show will be commencing from April 3rd - 5th 2007 at Dubai International Exhibition Centre. IPS has been growing continuously since its launch in 2005. Last year's International Property Show Dubai had over 160 exhibitors from 30 different countries and 16,000 visitors.
Executive Property Exhibition & Conferences (EPEC)
Location: London, UK
Date: 19 - 20th May 2007
The leading UK and International Exhibition and Conference focussed exclusively on Executive Property and Associated Services.
Property Investment Exhibitions can help you take the first step to realising your property investment goals.
At investment property exhibitions you will see our range of properties, and have the chance to chat to knowledgeable Local Area Consultants. Exhibitions take place at regular intervals around the country.
Investment Property exhibitions are a great place to do your essential property investment research on your particular field of interest.
Investment Property shows are dedicated property investment events for serious property buyers at every step on the property ladder. So if you are considering buying for investment or residential purposes, in the UK or abroad, visit as many investments property shows and you will et all of your questions answered by property professionals.
Generally property investment exhibitions and investment property shows will feature investment property and property-related services from over 100 exhibitors including major house builders, developers, estate agents, lenders, brokers, designers, landlord associations and other leading property experts. A programme of information seminars will cover all aspects of buying, selling, financing and managing your property.
Whether your primary interest lies in the UK or overseas investment property markets, put investment property exhibitions in your diary if you are a serious property investor. In addition to the range of investment opportunities on offer at property exhibitions, they are the ideal place to obtain reliable, up to date, market information at the beginning of what is predicted to be a new period of property growth.
Access to accurate and relevant information is central to successful investing. Its little wonder, therefore, property investor shows are the 'must attend' event for all investment professionals and first time buyers.
You don't have to be a property professional to visit the property exhibitions. If you're an owner-occupier seeking to move to a new, larger or smaller property, you will find property exhibitions an invaluable resource.
Amongst the exhibitors are house builders, developers, estate agents, mortgage specialists and interior designers. Property shows provides the forum for you to talk to the experts. The best sources are available to help you make informed decisions as you plan your next move.
Property exhibitions are the place to discover how to realize that dream of owning your own home. Despite shortages in affordable housing, opportunities really do abound for first time buyers to enter the housing market. Property shows will help you identify the options which match your circumstances, with supporting seminars tailored to provide essential insights to help you buy your own home.
Property investors shows tend to have a larger proportion of overseas property on exhibition, the mix is usually 40% UK Property and 60% Overseas Property.
This mix will enable you to compare and contrast the opportunities available both inside and outside the UK. Whatever your reason for property purchase, be it for investment, residential, retirement or holiday purposes, the specialists you need to help bring your plans to life will be on hand to assist.
Property exhibition visitors rightly regard the seminar programme as an essential component of the show. Established topics such as 'Buying your first home', 'How to buy below market value' and 'understanding Buy-to-Let' will of course be covered. In addition the property exhibitions programme will usually highlight themes which are currently topical, including; 'How to buy below market value' and 'Identifying emerging Hot Spots'.
Property exhibitions take great care to ensure they put on truly informative seminars, not sales pitches. Both the speakers and their material are carefully vetted, to ensure you gain real insight and understanding from each session.
Buying a house is the biggest investment you're ever likely to make, so it's important to get all the information you need on mortgages and legal matters before you start. Here we take a look at the basics, from how much you can borrow to choosing the right mortgage for you.
As a general rule, mortgage companies will allow you to borrow three times your salary, or two and a half times your joint salaries if you're buying with someone else.
In the current market there are many different types of mortgage available, some of which will let you borrow more than this. For example, some companies will allow two people buying together to borrow three times the greater salary and one times the lesser.
There are also many innovative schemes around, such as those that allow borrowers to add the rental income from letting one room to their salary before their income multiples are assessed.
It's worth seeking advice from two or three independent mortgage or financial advisers to find the best deal for you. Remember, though, that even if interest rates are low now, there's absolutely no guarantee they'll stay that way.
Never keep back any information on debts or county court judgements when securing a mortgage; it could come back to haunt you.
It's worth trying to save as much as possible for an initial deposit, to secure the best repayment deals. With property prices as they are today, however, saving even a five or ten per cent deposit can be a real problem.
If your deposit leaves you flat broke, some mortgage companies will offer you the incentive of cash-back after completion, but you may have to pay a fee (redemption penalty) if you decide to pull out of the agreement.
If it's a choice between paying off expensive debts such as credit cards or personal loans and saving a deposit, it's often advisable to do the former and take out the best 100 per cent mortgage available. The choice and rates of such mortgages have become wider and more competitive in the past few years.
It's only natural when buying a property to be more concerned with its size than with studying the small print on the mortgage agreement. But the wrong mortgage can cost you tens of thousands of pounds more than it should.
Mortgage providers often offer special deals to encourage people to take out a mortgage with them, and these are usually in the form of short-term introductory benefits on your mortgage. These benefits might be a discounted rate, a fixed rate, or a capped rate for a certain number of months or years, known as a 'tie-in period'. Mortgage providers will want you to stay with them for as long as possible, and, because of this, many mortgages may contain a 'redemption penalty'. This means that if you want to pay off your mortgage early, or move it to another mortgage provider, you will have to pay a fee.
Basically, the longer you borrow the money for, the more interest you'll pay. The other side of this is that the longer you take to pay back the loan, the less you have to pay each month.
The typical mortgage is lent for 25 years, so you need to be in your first property for five years in order to reap the benefits. This is because, if you have a repayment mortgage, most of your repayments during the first years are spent only paying interest. Also the cost of moving (solicitors, stamp duty, and so on) means that it's uneconomical to move regularly.
For example, if you pay off a �40,000 mortgage in 15 years, rather than the normal 25 years, you'll have higher monthly payments for those 15 years, but you could save a staggering �20,000 in interest payments.
Your other big decision is what type of interest rate to have on your mortgage.
The basic decision you have to make is how you're going to repay the money you've borrowed. Don't be confused - there are only two basic types of mortgage:
By taking a 100 per cent deal on a repayment basis, first-time buyers can begin to repay modest amounts of capital almost immediately. Choosing a deal that allows overpayments to be made without penalty can also accelerate the amount of capital that's repaid.
A good 100 per cent mortgage can offer a viable solution for some, although borrowers should try to avoid the mortgage indemnity premium (MIG). If you have no, or only a small sum to put down, a lender may charge you this premium in order to cover himself in case you're unable to keep up the repayments. On a 100 percent mortgage, MIG usually works out as an additional cost of about three per cent of the amount borrowed, increasing the overall borrowing to 103 per cent. It could be cheaper to find a loan that does not require this.
If you're buying a property with a friend or partner, there are a number of issues to consider and steps to be taken to protect your investment before signing on the dotted line:
If you and your partner aren't married and decide to buy a house together, it's important to realise there's no such thing as a common law wife or husband (except in some extremely obscure exceptions). In the absence of any other legal agreements, if you're not married the law sees you as two distinct individuals with no call on each other's money. That means if the utility bills are in your name, you're ultimately responsible for paying them. And if you pay into a savings account in your partner's name, the money's legally theirs.
The solution is to draw up a living together agreement. For day-to-day concerns, such as paying utility bills, sit down and talk it through. If one of you earns more than the other, for example, will that person pay a larger proportion or will you split the bills 50:50, with the richer one paying for more of the treats?
It's a good idea to open a joint current account, but it's important you both agree what the money is to be spent on. Spending the money on an expensive box of Belgian chocolates instead of paying a gas bill is sure to start a row.
Finally, take time to read all the small print. Always ensure you know what you're buying and check dates for when any discount or fixed rate runs out. And be particularly careful to check for penalties for paying your mortgage off early, moving to another provider before the tie-in period expires, or for missing a payment.
Mortgages should be straightforward - you borrow money to buy a house and pay interest on the loan. But after a few enquiries, you soon realise that it's not so simple after all.
In a hugely competitive market, building societies and banks are continually updating and extending their range of mortgages. The list is already extensive enough to baffle all but the most determined.
The most important points are how you pay back the capital you borrow and how you pay the interest on it.
You can either pay a little at a time as you go (repayment mortgage) or pay it all off at the end (Endowment, Isa and pension mortgages).
You have to pay interest on any debt, and mortgages are no different. They differ only in the range of options offered.
The government has given homebuyers a list of vital checks to help them find their way through the mortgage maze. The government suggests buyers should ask these 10 questions before agreeing a mortgage with a lender.
Useful sources : The Property Investor Show & bbc.co.uk