The complete guide to property investment. This is a VERY detailed guide to property investment. The aim of the property development course is to help empower people to get involved in property including property investment.
This guide is MEATY and will only get more detailed as we develop it constantly. If you want a taster of this guide go here for a less than 5 minutes summary of this guide which is designed to give you a quick overview.
This is the ultimate guide describing the property investment process – a powerful investment tool that builds your net worth and benefits your local community. If you are interested in starting making money in property investment remember to start small and work your way upwards – nobody starts out with a huge property portfolio in their first year.
This is for people who are already financially sound (no bad debt, positive cashflow, constant savings, high credit rating).
If you are not financially sound then there is no point reading about property development and property investment. Sort this out for free right now. That’s correct, if you go to this part of the website we will teach you how to be financially sound for free. go here now
If you have sound finances then read on:
So many people have amazing finances and then go out and buy an unsuitable first family house leading to a lifetime of huge mortgage payments and missed investment opportunities.
Do not let that be you.
This guide is for people who are saving for their first mortgage for their family home. They want to stop paying rent and stop having a landlord. They want to be settled and feel like they have a home of their own.
But they also do not want to make a mistake when buying their first house. They want a property in which their equity will rise quickly in value so that they can start investing in their first investment property.
This guide is also for people who want to buy multiple properties to rent out so they have a stable positive cashflow for life.
If this sounds like what you want to do then read on.
Sorting out your finances and buying your first home are basic steps in property investment.
We have already deal with sorting out your finances here.
At the end of part 1 of this guide (once you have actually implemented the steps) you will:
We will also move on to look at the next step in our intermediate level guide.
The intermediate guide is for people who have solid finances (no consumer debt), growing savings and a mortgage on their first family home.
These people are looking for ANOTHER mortgage to buy a property they can rent out.
They want to start taking in a small income from this rental while it pays for itself and rises in value.
These people also plan to build a retirement nest-egg and they know that this starts with an investment property.
They want a low-risk, low hassle investment.
This more intermediate guide is suitable for:
We teach that you need to start building a nest egg for retirement
Finally the guide will look at how you can turn property investment into a full time business
The guide will help you:
All property strategies should start by focusing on getting a mortgage for your first family home.
This is because it means you are not paying rent and seeing all that lovely hard earned cash leave your bank account for good. And it gives you a stable base from which to work on your career and earnings. Having a mortgage on a family home (even if it is a two bedroom terraced house), gives you a wonderful sense of belonging to a community and a sense of control of your finances.
This family home should be very affordable and should be just big enough for you and your family.
It is not a good strategy to take a mortgage on a house that you will grow into—this is because everyday YOU are paying for all that extra space you do not need.
It is a different case if you are planning to buy a large house to rent out the rooms because those rooms are paying for themselves.
So all property strategies start with getting that first, very affordable mortgage for the family home.
This mortgage should be interest and capital repayment so that you own the house outright at the end of the period.
In terms of sorting your finances and building up to getting your first mortgage we deal with that in personal finance. So if you have not sorted your finances and got your first mortgage deposit ready then go there now.
We are not going to speak too much about getting a mortgage here as if you have your finances sorted and a good mortgage deposit (save at least 10%-25%) then getting a mortgage is like buying a new car, its really easy. Information on the various types of mortgages can be found below:
Now, from here there are two divergent paths. You can:
1- Build equity in your family house, save another mortgage deposits and then re-mortgage to start flipping properties.
If you start flipping properties you are moving into property development and we have a free guide here on property development.
We separate property investment and property development quite strictly in this website but they share a lot of common knowledge and skills,
So if you are sure you are interested in property development and flipping/trading houses then go there now. The rest of this section is all about property investment.
2 – Build equity in the property, save more mortgage deposits and re-mortgage to obtain a second (and a third, fourth..) mortgage for a buy-to-let investment property
You can use interest-only finance to buy:
All of the property investment strategies have the same general, broad stroke steps which we will explore now:
The steps of property investment:
Once you have picked the property strategy that suits you then you can move onto the following procedural stages of property investment:
As you can see, creating a strategy that suits you and what you want to do in your life is the hardest part. Actually plodding through these investment steps above is the easiest part. Of course each step can be boring, frustrating, costly, time consuming but if you keep plodding along you will get there. You do not need great skill, cunning or business acumen to go through these steps. You just need to fix your strategy and keep going.
All property investment ventures start with one idea.
This idea must be within your chosen property investment strategy.
If you have chosen ‘Buying houses to rent to families’ as your property strategy and you start dreaming up ideas of buying land to do nothing with then stop!
Pick one property investment strategy and then develop ideas within that one property investment strategy.
So if you pick ‘Buying houses to rent to families’ , then only consider ideas that concern ‘Buying houses to rent to families’
Once you have an idea then the next logical step is to develop this idea using a feasibility plan.
A feasibility plan is not as detailed as a business plan. It is a quick, easy to fill in document that can tell you very quickly whether an idea makes financial sense.
Once the idea passes through your feasibility plan and is therefore ‘feasible’ the next logical step is to develop it using a business plan.
A business plan is detailed document that outlines all the projected costs, incomes and profits of the proposed venture.
Once you a solid business plan that makes financial sense you can move towards financing the business.
Unless you are already wealthy you will need finance for a new business.
Even for rich and wealthy people it is quite common for them to use finance to fund a new business.
Then you can start preparing your paperwork that a bank will expect to see.
You need to book an appointment with your bank or investor
For property investment this will be usually in the form of a mortgage.
What are the various types of mortgages available ?:
Buy to let mortgages:
Bad Credit mortgages
Mortgages and age limits:
Whoever is giving you finance must be regulated by the Financial Conduct Authority or the Prudential Regulation Authority:
Do not forget – everybody who is in the mortgage offering game knows and talks to each other:
Do you need a mortgage broker ?
There are many options for property investors in terms of whom they obtain finance from
Never allow yourself to think that you local bank is the only option. For sure, cultivate an excellent relationship with your local bank but remember that there are a million options.
Lets take a look the banks and building societies in the UK in more detail
There are many questions regarding getting a mortgage from a bank:
General questions re all types of mortgages
Once you get the green light you can start actively trying to source a deal and close the deal
You need to look for a property
New build houses:
New build apartments:
Second hand properties:
You need to buy the property or piece of land
You need to start marketing your finished property.
This is different that just the task of selling. Marketing includes selling but selling is only one small part of marketing.
You need to rent the property to start taking in your cash.
Every landlord needs insurances:
You should insist that your tenants have:
As a property investor you need to maintain the property.
Some investors are astonished that they have to spend money on maintaining their properties.
You spend money on your haircut, your skincare, clothes. Or think about how much you spend on new tyres and oil and filter changes for your car.
Property needs to be maintained. Simple. We at the property development course teach you to take these costs into account before deciding to invest in a property.
Maybe you will choose to sell the property at some stage in your life.
You need to compare your business plan to what actually happened:
Some investors have such an awful time in their first property investment that they say ‘never’ again.
Well that would be a silly thing to do.
If you hang in there, review your mistakes and wins and return to the property market you will do better.
The more you invest in property, the better you will do.
One of the best examples of this is as follows: A child goes to school and learns basic maths. At the time basic maths is quite difficult. But as the child progresses then basic math becomes easier. In progressive years as the child studies Algebra and so on, he or she looks back on basic maths and laughs at its simplicity.
In property development and property investment the same is true. At first basic concepts like rental yield and amortization schedules are difficult to get your head around.
But as time goes on everything gets easier.
So hang on in there!
We curate a list of our favourite books and audiobooks on property investment here