Location is more vital than ever. If this is your first property development, it's probably best to stick to an area near to where you live. This way you should have a good idea about the local housing market and be able to oversee the project at close quarters.
If you decide to develop further afield you can either research the location yourself or employ a specialist letting agent to help you. If you do decide to do it yourself, you will need to speak to local estate agents, employers in the area and the local authority. Local papers can also tell you about the demand for rented housing.
Knowing how to find up-and-coming areas that will outperform the market is a real must. This is easier said than done but you stand to gain when the area becomes fashionable. Look for new transport systems, regeneration or areas that are next to desirable areas. Remember though an estate agent may describe an area as up and coming in order to make a sale when the area has no prospects of improving whatsoever.
Check with local estate agents what types of properties have recently sold and for how much. Hometrack produces a useful independent property database by assessing the sale results of 3,500 estate agency offices in England and Wales.
Plotfinder and The Society for the Protection of Ancient Buildings (SPAB) will be able to give you details of properties available for renovation or conversion.
If you are developing the property to sell on or rent out, it's important when you go to view that you don't fall in love with something and allow all practicalities to leave your mind. Instead, keep your business plan very much in mind. It might be helpful to take a list with you with the various 'must-haves' on it: is the parking good; are transport links good; will the property suit one of the renter-types you're aiming at; will it be easy and relatively inexpensive to run... and so on.
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