More and more of us in the UK are taking the plunge into property investing. By property investing I mean people who own or manage more than one property, although it would be technically correct to refer to all homeowners as property investors, for the purposes of this article lets look at those who are considering "taking the plunge" and buying additional property for profit. Unfortunately, although there are considerable profits to be made (and being made as we speak, a significant percentage of the richest people in the UK made their fortunes through property!) many novice investors suffer serious financial losses and in many cases these losses could have been avoided with some planning and foresight. The absolute first consideration is not raising finance, choosing property in right location or even marketing the properties for sale ( although these are all obviously important factors),it is allowing for the time commitments running a property business will have on your existing occupation, social life and family. Many people seriously under estimate the time and hassle involved in running a part time business, for those who have the financial resources to invest in property on a full time basis this of course does not apply, but for most of us starting out in property, we will be juggling a full time job along with family and other commitments in addition to property investing. Cast your mind back to the purchase of your existing home, was it quick, easy and painless? Unless you have been extremely lucky the answer will be an emphatic NO! You will probably have viewed in the region of 20-30 properties just to arrive at a short list, some of the properties you were interested in may have fallen through at various stages due to "gazumping", survey problems or a host of other difficulties. Then there is the paperwork, mortgage applications, solicitors and conveyancing.... Try and work out how many hours you actually spent on the whole property buying process, I think you will be suprised at the amount of time involved. Now consider this, buying a property as a home is MUCH easier than buying an investment property! Take the amount of time involved in buying your existing home and multiply it by a factor of 3-4. Then of course we come to the second stage, the refurbishment/renovation of the property to ensure good selling price and finally selling the property, or renting it out to suitable tenants. Are you beginning to see the time and effort involved in just one additional property? Unless you are willing to make a substantial commitment in time do not even consider property as a source of additional income, it is a labour intensive business even at the best of times and the potential problems are many and varied. If you have taken this on board and are still interested in property investing however, then the potential rewards can be huge. |
