If you are new to property investing you will need to play the numbers game. You should get a 30% plus discount 1 in 50 viewings. Those 50 viewings will teach you a lot about property too. The better you get, you should get a 1 in 10 to 1 in 3 conversion. Make sure you are aware of the following:
* Location
* Condition (any refurb needed? Have you costed this?)
* Value now versus real market value after refub
* Tenant demand
* Rental value (no. of bedrooms)
* Local Comparables – other property values
MAKING AN OFFER
You can use all sorts of strategies for offering on properties. You need to know your maximum buy price before you enter into negotiations :
* Know your maximum price
* Know your offering strategy – How are you going to put the offer on the property
* Negotiate with agent or straight to vendor
* Know the vendor, and their motivation
* The more desperate they are, the better negotiation power you have
* Your benefits to the agent/vendor and why they would sell to you
GETTING AN OFFER ACCEPTED
Once you have an offer accepted you need to make sure you can go ahead with the purchase. The more properties you make offers on, the more likely that some of them will be accepted. Remember, be realistic on the number of properties you offer on depending on your financing capabilities. From here you instruct the solicitors and mortgage brokers to go ahead with the purchase. Simple.
SURVEY OF PROPERTY
You will need to have a property properly surveyed by a RICS surveyor in order to get lending on your property. This needs to be done within 10 days after agreeing to purchase the property. The following are important:
* What is your buying strategy? If it is NMD or No Money Left in, what valuation are you going for
* How should you behave on the day of survey and who will meet the surveyor?
* Which surveyor do you want valuing your property and do you need a mortgage packager to have choice over instruction?
PROTECTING THE DEAL
Between getting your offer accepted and exchange, you are exposed to being gazumped, especially if you have managed to negotiate a big discount. You need to protect your deal:
* How good ais your relationship with the agent (and the manager of the agency)?
* Is it a repossession and if so it will be marketed right up until exchange
* Will the vendor agree to having the property taken off the market?
EXCHANGE CONTRACTS
Once you have exchanged, you are legally obliged to buy the property. At this stage you will need to pay over 10% of the purchase price to the solicitor. Can you get a licence to entry to the property so that you can do your refurb between exchange and completion to save time and money? Instruct letting agent and refurb teams so they can be ready before or at completion. If it is a No Money Down, is your bridging finance ready and it will also complete on the same day.
COMPLETION
Funds will be drawn down from the lender about 3 days before completion; you now have legal ownership and your name appears on the title deeds. If you have not refurbished yet or got your property to a lettable standard, you will need to do this fast, as every day of void is taken from your cashflow.
Angela Farrell is a successful property investor and is passionate about empowering women with the knowledge to invest in property for their long term wealth. She bought her first property when she was 200K in debt, has built her portfolio to over 1.2 million in 2 years and is now living the life of her dreams.
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[tags]property investment, property, properties, no money down, estate agents, letting agents, RICS[/tags]
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