Property Development Tackling Your Property Development

Date Published:

04/06/2009

Designing a property development is a complex task. Get it right and you could be quids in. Get it wrong and you could find yourself truly out of pocket. Here are some helpful pointers.

Compare Spend To Profit

First Timers: Don't Be Overly Ambitious
If you are new to property development and are unsure of your skills and commitment, Catherine Dawson author of The Complete Guide to Property Development for the Small Investo (Kogan Page) recommends choosing a property that does not require major work. 'Instead, choose a property that needs some updating, such as a new kitchen or bathroom.. Making simple design changes such as these can add considerable value to a property,' she says. However, Catherine emphasises the need to carry out a detailed market research to be successful in your renovation project.

This is good advice if you have little experience with budgeting or estimating just how much work might cost - mostly because renovations almost always come in over budget due to unforeseen circumstances.

Get Free Advice At Viewing Stage

Assess at the viewing stage how you can make your development most appealing to your target market for the minimum outlay. Also, find out at this stage if there are any problems with the building that might mean it's best to steer clear. Get as much advice as you can on costing the work, especially if you are a first-timer to property development. Ensure you make lots of visits to the property with tradespeople so you know what you’re letting yourself in for. Very few people have the skills and time to do the work themselves so get free estimates (then, later, written quotes) for work from builders, timber specialists, damp experts, electricians, plumbers and roofers to get an idea of costs. Don’t forget to cost for carpets and decorating, too - and check out our feature on costing the work, too.

Can You Maximise Your Property's Potential?

If you want to do a dramatic transformation, it’s a good idea to call on the services of an architect to help maximise your property’s potential. If you don't have a trusted architect, Architect Your Home offers a pay-as-you-go menu of services which enables developers to utilise the professional input of an architect for as much as, or as little of their renovation project as they want. The service is available nationwide.

Then find out how much the property could be worth after development from a qualified local estate agent. Check out similar developments in the area to see what’s worked – and what hasn’t. Use www.nethouseprices.co.uk to find out what these properties sold for.

Set A Budget

It’s essential you set yourself a budget for the work and make sure you add between 10% and 15% as a contingency fund. Budgets have a habit of running over and borrowing extra as you go along is always more expensive..

Work out the cost of renovating the building’s exterior, the cost of planning and reorganising the interior and the cost of getting it into shape, remembering to include the garden if there is one. And take on board the problems that were highlighted in the survey. Before building starts, check if you need planning permission or building regulations approval with your local council, and add these costs to your total.

Online Help For Developers

Need more help? An online service can help developers assess a property’s improvement potential. 'For a flat fee of £495, Betternest will produce a report which tells developers how much space they can add to their development, how much it will cost and crucially what value it will add to the property,' says Simon Smith, chief executive at Betternest. 'Until now there was no way for a developer to accurately assess their property’s potential without commissioning designs and submitting planning applications. It’s an expensive, time-consuming and often frustrating process that puts many people off,' adds Simon.

For More On Property Development

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