I don't know how to find land, find out if I can build on it, how to purchase it, how to project all the costs for building six houses, how to market..and most importantly how to persuade my bank once done all the costs that I need the money to do the project.
I am dooing all this on the assumption that the homes get brought and I can pay the bank back and make a net return of at least £100k from my £40K
Is this possible?
I have no idea at all about construction ..or costings
What do I need to do?
Can I interest you in some magic beans?
But seriously, have you watched TV shows like property ladder? Thats about all you need to know to get started judging by some of the chavs on there.
Just find a property that would benefit from a refurb, and get it bought.
40k will not get you one piece of land large enough for one house and if it did you would have no money for building, architects, solicitors, planning permission, estate agents fees, insurances ...
i think you will need a bit more than 40k to build 6 houses unless you are going to build them yourself or are going to build wooden sheds i think you should keep saving
good luck. £40K won't even pay for you legal, estate agency fees and Architects fees. A decent plot to build 6 houses on will cost more like at least £400K, so you £40k is not even enough for a 10% deposit. Then you have the competition of the other builders and investers in the area. then you have to get a loan, while you are paying for the loan you will have upto 6 months of planning to resolve. £40K won't cut the mustard. For 6 decent houses the build cost may be upto about £450k. I suggest buying a couple of buy to lets.
you'll need more than 40 k for that.
You would need a lot more than 40k to build 6 houses may be you should build 6 sheds or maybe 6 dog kennels.
40k, for a plot for 6 houses? mmm, try 400k.
40k doesnt buy anything where i live, minimum is about 70k for a small building plot ( east yorkshire area) and then of course you must build the house on top of that....
Good luck anyway
it is very possible, off plan developing.
i have been looking into this but don't have cash.
if you are serious then e-mail me and i will discuss.
40k / 6 = not much for a house
best of luck.
let me know if you succeed as i would like to do the same
See a commercial estate agent, tell him/her what you have and what you want to do.
If they think its a goer, and they give pretty good advise usualy, as they may end up making money when they sell your houses.
Then do some research find out where you want to invest what type of housing is in demand in that vicinity, how much building costs are, architects fees, legal fees (see a financial advisor), and most important of all find out if you have a good chance of full planning permision being granted.
Its extreamly unlikely you will find a possible development without some sort of planning already on it and not for 40k.
You will have to go into partnership with a developer i think or find out how much money the bank will lend you to have a go at developing yourself.
40 k isnt realy enough, maybee up north it might be !
Production costs for building say 2/3 bedroom houses is about 60/70 k each.
Theres a lot to check out, but if its what you want to do, then you can make it happen.
It requires work though, not as easy as the tv programs make it out to be.
ps: you can get a rolling loan, so you borrow, build one house sell it then you will get lent more money and so on, it is achievable i think but you will need to work it a lot & do lots of research and never take no for an answer.
I'd sit on it for now if I were you, land is at a premium and the prices are sky high, you will end up in a lot of debt if the properties and land are far higher than your profit, maybe buy a cheap house at auction and do that up and move on from there for the time being, then in a few years when you have more money in the bank and land has hopefully come down in price you might be more experienced and have more money to make that huge profit for yourself, good luck.
check websites in spain but you would need a bit more money to reform a property they start from 6-12000 euros approx for a piece of land and around 18000 euros to build but do your homework very important and you get a free holiday cant be bad
Not a chance matey, you'd need more like 500k just to start.
40K won't buy much. Why not start off with one property, live in it for a while, fix it up, sell it and then buy one slightly more expensive than the first.....and start the process over again.
House flipping is becoming quite 'the thing' here in the states....although very few people seem to have the slightest idea of what they are doing.
Good luck but don't get in over your head.
You have no chance. The land at best, with planning permision would cost £250,000 to £500,000. A bank will lend 80% of the cost of building the houses - say £0.5M - £1.0M???
Think about a commercial property investment bond or if you will tollerate more risk a Real Estate Investment Trust
Buying and owning properties like this is RISKY. Do your research - get a book on the subject and watch the TV.
I want to care but................
Hi,
Well it certainly sounds like you're ready to go, and have all the right skills in place.
I suggest you just dive in and buy any old piece of land. You can figure out the rest as you go.
You can buy a piece of one of my agricultural land if you like, I can sell it to you for £20K if you like, and if you don't get planning permission I promise to buy it back from you in 6 months at 90% of the value....see you can't loose much
Good luck with this project, I'm sure you'll suceed.
Homebuilding on speculation is usually a 15% business. For your 40 K you will probably be able to borrow another another 120 K to go with it. Your original money would usually be used to purchase a lot, or lots. You are mobililzing 160 K. You can build your properties and after you pay your costs and expenses you are likely to earn about 15%, or 24 K. That would be a very acceptable return.
If you do not sell the property the construction loans will epire and you will have to pay a mortgage, like everyone else. You will lose all of your earnings if you do not sell the property in a timely way. The holding costs on such a property are usually 1% of the value. In this case about 1.6 K per month. It is very possible to go broke holding new unsold properties.
That is the simplest possible explanation of the model.
You really don't have enough to start. You can buy cattle with your money instead. There's an idea.
Invest in Buy to Let or Below Market Value properties.
Speak to an independent financial adviser first, as you will be getting scalped on tax.
Unless you're planning to build dolls' houses you'll need a bleeding sight more than 40K!
"All I have is £40K". Poor you.
Give me the cash and I'll buy you a lollipop.
Not meaning to be harsh but r u joking?!
For a start u would be lucky to buy a piece of building land for 40K. If u just buy a normal plot of land u have to get planning permission, then go through all the legal stuff and then u would prob have enough money to put a small wooden shed up!
I would use u're 40k to put down as a deposit on a mortgage
40k won't buy you much land at all.
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