Investing In Property
Investing in property only last year was a relatively easy way to make money. You could simply find a cheap property, using property auctions, estate agents or a specialist service, renovate it and sell on. Mortgages were easily secured so financing the property projects was not a problem. Not only have you made the profit from the renovations but you've also made profit just because house prices were rising at a rocket 10% per year.
House prices have now fallen and are still expected to fall further and the question is, is there still a profit to be made?
Well, many people believe that house prices will rise again from 2010 or 2011. So, you need to be able to find a cheap property and hold on to it. You therefore need to be vigilent, you need to choose the location and the desirability of the property with more care. Your finances and mortgage, if applicable, need to be in good shape and you need a sizeable deposit.
Yet, on the upside, with less punters in the property market and sellers desperate to sell, you can offer a very low price. It's a buyers market and will be for probably the next two years or so - see our review of what property commentators expect.
However, do not invest in property with a view of getting a quick turn around. You can make the most of the falling property market, by buying cheaply and keeping the property on a buy-to-let basis. Or you can wait, to see how house prices fair next year. Of course, they are likely to fall, but be too late and you could lose your excellent bargaining position and once the market has hit the bottom there will be more competition to buy the same property.
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