Will a Block of Flats Be a Good Investment for a Property Developer?

Property developers are always encouraged to try to diversify their portfolio as much as possible and try to find new projects that could represent something interesting. Could a block of flats be a good choice for investment? Let’s take a closer look at what needs to be thought about before committing to such an investment.

Renting or Resale?

When purchasing a block of flats, you will be presented with a set number of units that you can choose to do one of two things with. You can choose to divide them up and sell them on to new owners, or you can retain control of all units and rent them out individually.

Both paths have their merit, and it could result in you being able to expand your portfolio in very different ways. If your aim is to become a landlord in addition to developing property, then keeping them on is obviously going to be the right choice for you to make.


Location is everything when it comes to property. If you are hoping for a quick resale, you need to make sure that you have flats in a location that people want to be in. Trying to buy something on the outskirts of a town and revitalise it yourself into the place to be is going to be incredibly difficult. If you can instead buy somewhere that already has a good vibe to it and plenty of interest in the surrounding area, you are in a better initial position.

Are there shops within walking distance of the flats, and what do they offer? Is there some sort of community hub – bet it a pub, a school, or something like a leisure centre? Is there plenty of parking nearby if the block does not have its own dedicated carpark? Finally, are there good public transport links nearby for those who don’t own cars? All of these are going to be key questions you need to ask yourself when trying to find the perfect property to invest in as a property developer.


The initial cost of the sale is just going to be the start of what these flats will cost you. As a property developer, you will no doubt be interested in doing up the building in some way. To do so, you are going to need to have workmen to help you out. You might have your own team, or there might be a building firm you work in close partnership. Either way, you are going to have to pay some form of labour and supplies cost to get the properties up to standard.

The more derelict they are, the higher they will cost. Taking something like an old school and turning it into a set of luxury apartments is an experience many will want to complete, but redesigning an old block of flats and bringing them up to standard can be just as interesting a project to undertake.

There are some other costs that need to be considered too. As soon as you buy the property, you might want to look into getting a special block of flats insurance policy to keep things protected. Once you have put in an offer, you can start by requesting a quote here to ensure that everything will be safe once it is yours.


With any property development project comes a certain degree of risk. You might think that you have bought your perfect quick flip only to discover that there was a reason the property was so cheap. Poor electrical wiring throughout will mean you need a complete refit.

Likewise, you could discover asbestos in the walls. This will bring the project to a complete halt as you look for a specialist who can come in and remove it. You need to approach every potential investment with the mindset that it could carry risk in some way.

Thinking that you have found the perfect property is only going to result in you jumping in and ending up with something that you should have left alone. Even if it takes you a little extra time to work out, it will always be worth it to investigate a property before you put in an offer, especially for a risky investment like a block of flats.

A block of flats could represent an incredibly worthy investment for the right developer, but such a deal rarely just falls into someone’s lap. If some flats have caught your eye, you need to make sure that they are indeed going to be a worthwhile investment for you to pursue. Take your time to ensure that you are financially protected, and don’t be afraid to back out of the deal if something comes up that you don’t like.

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