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Get rich quick with property By Hannah Ricci
Property continues to be a hot discussion topic up and down the country and most of us know someone with either a success or horror story of investing in bricks and mortar.
Property investment is popular because it is a tangible
"It's crucial to buy in an area that you know very well - usually your home town or somewhere very close to it," she says. For example, Fletcher bought her first property in her home town of Bournemouth at 19, before buying, renovating and profitably selling seven other properties in quick succession. "So many people who invest in property don't even visit the area or view the property before they buy - you wouldn't even do that with a pair of shoes, so why do it with a huge purchase like property?" she says. Know your area You need to distinguish the good streets from the bad, know where railways or busy roads run and where the local eyesores are. That way you can ensure you will always have a market for your properties. "Buying in your local area also means you can reach it quickly if you're dealing with tenants or need to be on a site you are developing," adds Fletcher. She advises against buying properties in off-plan developments. "It doesn't matter how good value they are, when they are completed there will be a hundred or so other people trying to let an identical property to yours," she says. "This is what happened in London's Docklands, where people were seduced by the glossy brochures only to find out later there was a surplus of property and not enough demand." Delegate If you have a day job and don't have time to fully commit as a landlord, Fletcher says a good local letting agent can be invaluable. "Make sure they are registered with the Association of Residential Letting Agents (arla.co.uk), so you can get advice if you have any problems," she advises. "But don't expect them to do everything; you will still have to get your hands dirty from time-to-time." Fletcher took on her renovation projects with no previous experience, but learnt a lot very quickly. "Property development is a full-time job and to approach it otherwise will undoubtedly result in disaster. You need to be onsite everyday - if you don't turn up, you can't always expect the electrician and the plumber to," she explains. She also suggests taking some time off work - around 12 weeks - to oversee the project. "If you don't know what you're doing, don't attempt anything - just hire a project manager," says Fletcher. "It's shocking how many people start knocking walls down and ripping out bathrooms without a clue what they're doing. A botch job will affect the value of the property, particularly when you get into the higher end of the market, towards £500,000." Fletcher's final nugget of advice? Over-budget. "Work out how much you think the project will cost, then double it and add 20% - it's a fail-safe formula," she says. Top tips for property Buy in an area you know well Visit the property and investigate the area Identify your market Don't buy an off-plan development Use an ARLA-registered letting agent Take time off work to renovat. Be onsite every day Over-budget The buy-to-let landlord Greg Heywood, 41, from Liverpool, owns 150 properties worth £53 million. But he hasn't always been this wealthy - in fact, 10 years ago he was sleeping on his mate's floor. "I had been through a messy divorce, which had left me saddled with debts that I couldn't repay, my bank had closed my account and I was being threatened with jail," explains Greg.
He was working at B&Q and decided to throw himself into his job, which resulted in several pay rises. "I started to repay my debts and get back on track," says Greg. "I'd really hit rock bottom, so I vowed that I would be rich enough to have a £1 million annual income by the time I was 40." Three years after his divorce, Greg was able to take out a mortgage and bought a small property in Brackley, Northamptonshire for £80,000. He sold it shortly after and made £26,000 profit. Risky business "I started to move quite quickly after that and went on to buy property after property, stretching myself to the hilt and taking huge risks." Soon Greg owned 12 properties in Milton Keynes, which he rented out. "I kept going at an aggressive pace, with the view that if I was going to go bankrupt for £2 million it might as well be for £20 million." Greg says commitment is the key to his success. "Managing property takes a lot of hard work. I know of landlords who sell up because they can't keep up with their tenant's demands. But it's a two-way relationship and I think success is about providing a valuable service to tenants. It's very demanding, but it's also great fun."
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