From redundancy to entrepreneurship Chris Locke, CEO of Rainmaking and Startupbootcamp ASPIRE (https://rainmaking.io/) Losing a…
Building Your New Investment Property: The Full Guide
Are you thinking about building a new investment property from scratch? You’ve probably heard that there’s a lot of money to be made with a venture like this and that’s certainly true. However, it’s important to take the right steps, so let’s explore this.
Consider The Plot Carefully
First, you need to make sure that you are thinking about the plot of land that you are purchasing. This is in many ways more important than the final build of the house because it can cause a lot of problems for you if you’re not careful. The good news is that it’s easy to get this right. You will need to complete a survey and this will tell you everything that you need to know about the state of the land and whether it’s suitable for building on. Do be aware that land which is being sold at a dirt cheap price – often does have issues. You’ll need to be prepared for this. For instance if the location doesn’t have a water source you will need to install water bores and pumps.
You will also need to think about the size of the land that you are investing in. Ideally, you should ensure that the size is enough for your home or the design of the home that you plan on building. Consider the features that you desperately want to include and whether the amount of land necessary still makes this a cost effective investment.
Don’t Outprice The Buyers
When you are designing the home, it’s important that you do think about where you are building and who is going to purchase the home. Or, if you are renting, what type of tenants you are going to attract. You need to ensure that you don’t build something that is going to be far beyond their price point. This is an easy mistake to make and it’s one that can be avoided with the right strategy. You should research the market carefully as well as the area where you are building. Consider the price points of similar houses in nearby locations and aim for this type of design. If you do this, then you won’t have to worry about struggling to get the right buyers to bite.
You can also speak to your contractor. Make sure that they understand what you are aiming for and the type of price point that you are looking at. This will help them make key decisions including the materials to use for different elements of the build. They will also help you judge what features should be left in as part of the design and which options you can consider letting go of completely.
Choose The Right Contractor
Next, you need to think about the contractor that you choose to work with to build the property. Ideally, you should look at their portfolio and make sure that it matches what you want to achieve. It can be tempting to choose a contractor that is offering the best price. However, instead, you should be searching for one that can deliver the best value. A strong level of value will ensure that you don’t have to worry about your new property looking or feeling cheap.
Be aware that you do need to explore reviews of companies like this. You should examine the opinions of past clients. This is another key way that you can determine whether they are going to be able to deliver exactly what you need and what you want. Great contractors have a proven tract record of delivering the final results that their clients have loved. You will also need to get some quotes from a wide range of different contractors. This should provide you with a baseline of what you should expect to pay. Another key question to ask is how long the project is going to take. You should be able to gain a solid time frame for the project and they should be able to commit to this time frame.
Think About Your Budget
You do need to think about your budget. It is important that you take into account all the different costs that are associated with this option. Add them up and then you will be able to determine exactly how much you are going to need to pay. You should compare this directly to how much you expect to earn. The good news is that you can gain solid profits from this type of investment if you make the right decisions.
It is however important that you do not let your budget balloon out of control. This is one of the key ways that an investment like this can quickly become worthless and nothing but a lot of trouble.
Add Unique Feature
Finally, you do need to think about adding some unique features to the design of the property. This could be anything and is typically going to depend on the type of build that you want to create. But it has to have something that makes it stand out from the rest of the market and that will make buyers stop and think. People often underestimate just how competitive the housing market is. It can be very difficult to gain the right type of impact and ensure that you win a sale.
As well as adding some unique features to make a killer impression, you should also think about marketing it the right way. You will definitely need the full support of a marketing agency to guarantee that your property is going to make the right impression. If you fail to do this, then you could end up in a situation where it gets stuck on the market. This is something to consider after the build is finalised. It’s important to start marketing it immediately because the longer the home remains empty, the more money it will be costing you.
We hope this helps you understand how to build your investment property the right way so that you get the ROI you want. There’s definitely a significant level of risk associated with this possibility, but it’s not as challenging as most people assume. You just need to make sure that you make the right decisions early on in the process.