Property development is popular in the UK and it’s no longer the preserve of large companies.
TV shows like Homes Under the Hammer profile everyday people who turn a tasty profit by buying properties to rent or sell — even if they have no formal building or business skills.
Making a decent living in the UK property market is possible, but prior preparation is essential before committing your cash.
Here are five steps to set up your UK property startup.
- Business plan
The main reason The A-Team always succeeded is that Hannibal had a plan. And even if you’re not leading a crack commando unit on a series of unlikely adventures, you’ll need one too.
Working out your target clientele, cashflow, staff requirements and marketing is essential — download templates and learn how to write a business plan on the UK Government website.
Whether your business is a side-line or a full-time endeavour, a proper plan instils discipline from the start.
Location really is essential — but when you’re breaking into the property business, it’s better to snap up bargain properties in emerging locations that blowing your budget in an area that’s already booming.
Properties in the middle of London and Edinburgh are expensive, but Manchester is more affordable — its huge student population and demand for city centre apartments make it a promising pick. But outlying boroughs in any major city that are undergoing gentrification are always worth consideration.
- Buying to let or sell
You’ll have to decide whether your aim is to profit from buying real estate to rent or to sell.
Buying to sell can generate a quicker profit, although this obviously depends on the current market conditions. And buying to let offers longer-term returns, but in the past few years the government introduced higher stamp duty on second homes. Read this buy-to-let guide from OnTheMarket for more info.
- Interior decoration
Whether you’re renting or selling on your property, decorating it attractively is a no-brainer.
But a different approach is appropriate for each option. If you intend to rent, invest in durable rather than high-end fixtures and fittings and stick to neutral colours like white and beige that most people can live with.
Taking a chance with bright and bold colours when you’re buying to sell isn’t wise either — so keep it subtle but invest a little more in a high-spec finish that impresses potential purchasers.
If your long-term plan involves gradually migrating from your current career to property development, earning a formal business qualification will stand you in good stead by the time you’re ready to take the plunge.
Full-time campus-based courses might not be viable, but you can earn a remote MBA when you study with online university Anglia Ruskin Distance Learning.
And as your business grows, it’ll let you approach issues like strategic planning and change management with confidence and composure.
Follow these five steps to set up your UK property business and you’ll be safe as houses.
Do you work in property development? Share your thoughts in the comments section.