Future investing. develop or buy to let

Discussion in 'General Property Investment Discussion' started by UkpropertyNewbie, Nov 26, 2018.

  1. UkpropertyNewbie

    UkpropertyNewbie New Member

    Hello.
    New to property forum.
    And new to the world of property in general.
    However, I have an opportunity to buy My home, wich is currently owned by a housing accociation.
    The plus sides are I have been a tenant for over 10yrs plus.
    Wich qualifies Me as being entitled to the maximum discount at 38%
    The property is a 3bed semi, within a very sort after location for family/rental and also developers.
    It has off road parking wich I have done Myself.
    Plus a 30ft patio plus garden to the rear of property.
    There is also adjoining a side garden/potential build plot to the side of the property, either to sell with a.p.p
    Or to build sell make a profit,
    Or maybe rental.
    There is Enough room for a 4/5bed detached/2x2bed semi, a front garden plus off road frontal parking
    Along with rear garden.
    I was informed from a local builder the plot as it’s in a prime location could fetch around 150/200k mark.
    I’m not sure weather to work My way up building a portfolio for rental.
    Or turn to developing and then selling
    on a small scale to build cash investments
    For the future for My family.
    Advice on the best methods would be appreciated.
     
  2. Longterminvestor

    Longterminvestor Active Member

    First of all, from what you say, buying your property is a no-brainer. A 38% discount gives you plenty of headroom if things did go pear shaped because of Brexit. As for the plot in your back garden - personally, if I had no experience in that field I would look to sell the plot.

    If everything was to go smoothly there is more money to be made doing the development yourself. But things rarely go smoothly!
     
  3. UkpropertyNewbie

    UkpropertyNewbie New Member

    R
    Thankyou for replying
    Much appreciate the advice.
    I’m not sure what you mean by developing Myself.
    You mean hire a builder contractor.
    The only thing I could possibly offer in the way of self build,
    Would be the labour, wich I would have no issue
    Used to heavy labour I workout also so would have plenty of that to offer.
     
  4. lookinginvest

    lookinginvest Member

    Personally, if you are not a developer then I would consider an outright sale of the additional land and leave the problem of building a new property to someone else. Sounds like you could bank yourself a fair amount of money from a land sale. Maybe kick start a property rental portfolio for you?

    * I meant buying another home to rent rather than building one on your land
     
  5. diyhelp

    diyhelp Active Member

    What about a simple outright purchase of the property today and leaving the planning permission for another day? If you can afford the mortgage at the moment then I don’t see much downside for the part with potential planning permission.

    Here is an idea, you acquire the property today, move into the house and then obtain planning permission to build a new house on your land. Then, when the new house has been built, sell the existing one and move into the new one. That way you would avoid capital gains as the original property would be your residence and you simply be selling and moving to a new home. Take advice before doing anything but it might work?
     
  6. realdeals

    realdeals Active Member

    That last idea by @diyhelp sounds very interesting. It means you dont have to shell out just yet on building a new house and if it is possible to sell you main home and move into the new one without paying any capital gains tax then surely that is a win win?
     
  7. michael1978

    michael1978 Member

    For now I would just buy the house and rent as it is, I would not invest until I get some of my investment back.
     
  8. Longterminvestor

    Longterminvestor Active Member

    Hi @michael1978

    What would you medium to long strategy be for this opportunity?
     
  9. michael1978

    michael1978 Member

    Of course eventually I would invest and building another house on the property but unless there are money laying around for now I would just try to get as much as I can back.
     
  10. Longterminvestor

    Longterminvestor Active Member

    I understand what your are saying. At the end of the day, it is unlikely that the value of the land will do anything but go up and up as demand for property grows - so no rush to build. However, I am not sure how the member could rent out the property - where would they live?
     
  11. FWL

    FWL Member

    When you consider the potential uplift in the value of your house/plot I would look to secure the purchase asap at it only appears to value the propetry and the discount is huge. Then you will have the interesting option of selling the excess land, doing a JV to build it or developing it yourself - all at a time of your choosing.

    The potential returns differ a lot but so do the financial risks. Dont let your heart rule your head :)
     
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