Building and renovating homes can be a very profitable endeavour, and turning this into a business could find you some great success for many years to come. Property development is no simple task, however, as there are lots of things to consider from construction, financial, and legal standpoints, and so should be given plenty of time and thought to get it right. You’ll want to consider the types of property development you want to pursue and to help you make this decision, we’ve listed five types of property development and how you can get started with each of them.
Buying Commercial Property To Convert
Old commercial buildings offer a great amount of space, often for an affordable price. Buying a commercial property and renovating it can be a great opportunity. You could then sell that space to a business or rent it out for a great additional income source. Alternatively, you could convert the office space, or the entire block, into residential spaces. Turning an old commercial complex into a block of apartments will then allow you to rent and sell individual apartments as you see fit. Turning an old and run-down structure in the middle of a city into luxury apartments should, in theory, make you a lot of money, as you’ll be able to sell those luxury apartments for a huge profit. Of course, there are a few things to think about when choosing an old commercial property to renovate, including the quality of the structure and what sort of planning permission you can acquire. The last thing you want is to buy a property like this only to find irreparable structural damage, making it an impossible task to convert it and instead requiring you to knock the building down and start from scratch.
Adding A Structure To A Current Property
Buying a property with sufficient land around it and then adding another structure to that space can substantially increase the value of the property. Of course, many of these types of project will require planning permission, which can bring a project to a screeching halt. If the property is in a built-up area, there are a lot more things to consider, whereas if the property is listed or situated in an area of outstanding natural beauty, you might not be able to do much renovation at all. However, if you’re able to get the planning permission to extend to property or add a second structure, you could make a substantial profit when you sell. Whether you’re building a second home or a major extension on the property to increase the number of beds and living space, or you’re building a separate structure like an exterior office, the value of the property is naturally going to rise.
Buying Empty Land And Building Brand New Homes
When we hear the term property developer, our minds are often drawn to this method. The idea is to buy a section of land to complete a ground-up development of a property, from foundations to furnishings. This can be a much more affordable project than buying a ready-built property and fixing it up, as long as you have the team to undertake the project. Often a property development company will have their own construction team or contractors they work with to complete these projects, so you’ll have to ensure you have secured this important aspect of the project first. You’ll then have to find land for sale that will be suitable for your planned construction. This property development project could be for one or two unique buildings, which you could sell at a high price-point, or a number of smaller properties, each to be sold to different home buyers.
Purchasing Land And Selling Once You Get Planning Permission
A property development option that isn’t often considered is actually one that technically doesn’t involve the construction or renovation of any structures at all. In fact, this is predominantly focused on the buying and selling of land. Buying land is relatively straightforward in the UK, but one hurdle that many property developers run into when doing this is not being able to build anything on this land as they cannot acquire planning permission for the space. Applying for planning permission doesn’t guarantee that permission will be granted, and it can take years to get an answer in some cases. Of course, this can also take a few months, but it’s tough to predict. However, if you buy some land and then manage to get planning permission, you can sell that land to other property developers for a significant profit, as the land will instantly be much more desirable. Of course, you’ll want to have a great working knowledge of the planning application process and the patience to conduct research on an area to predict whether planning permission acceptance will be likely and whether or not the land is going to be good to build on and therefore valuable once you look at selling.
Buying Properties To Renovate And Sell For A Profit
A popular choice that many people consider without starting their own business is to buy a property for a lower-than-average price and renovate it to sell it for a profit. Individuals regularly do this as a personal project, but it’s possible to turn this into a professional business, too. There are a lot of things to consider if you’re interested in doing this, but the choice of which property to buy for renovation should be the most important thing to think about. There isn’t much point in purchasing a property that has been recently renovated, for example, as it’s likely already close to its maximum value. Of course, over time, the value will increase as the property market continues to soar, but this will take a few years and means that a quick profit won’t be obtainable. There’s also not much point in buying a run-down property on a street of other run-down properties or a property that is situated in a bad area, as it will be difficult to sell at a higher price point, too. You’ll want to only choose a property that you can comfortably predict a 20% profit margin at least. Otherwise, it just isn’t worth your time.
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