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How to get a 20% return on your property investment

Posted by Jennifer Jameson on July 14, 2017
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So you have some money to invest and want to ensure you make a good return, here are a few ideas to consider:

Turning your property into a HMO.

By creating a HMO (House of Multiple Occupation) you can significantly improve your rental income. This means you are renting the individual bedrooms to separate tenants rather than the house as a whole. There will be slightly more management involved and in some locations you will need a licence and to take additional safety measures.

Development

The idea of developing a property by yourself may sound daunting to some but it can create an outstanding return on your investment. This strategy may require additional upfront investment, there are some products available to funds such projects, although many investors take short-term bridging finance and then refinances as the projects nears completion. You will need to balance the risk/reward ratio and ensure you or your team have the correct construction experience and skills required.

Joint Venture

Joining forces with another individual with a complimentary set of skills, consider what each party has to offer and ensure you negotiate a split of profits as well as a detailed investment plan. This needs to take the form of a legally binding written contract to ensure everyone knows their role, liabilities and obligations.

Auctioning

This is a very popular method of investment, you need to ensure you know your limits and your finances and have conducted all possible homework on the property and market in question. Remember the reason for auction is to release equity from a property more quickly, either as a bank is selling a repossessed property or a distressed seller needs a speedy sale. You will therefore need cash available to complete the purchase within 28 days.

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