Dear all,

I am interested in buying a house in Sheffield to develop. I'm familiar with the Crookes / Broomhill areas but prices seem a bit inflated here and there's not much scope for profit. Can anyone recommend any areas that have got some potential? Where are any of you developers out there developing at the moment?

Cheers

Do you mean developing houses or do you mean buying a dump and nobbing it up to make a few quid?

There is a difference.

Tony,

I mean doing it up to make a few quid- doesn't matter what state it is in though,
-any suggestions?

Well the favourite old candidates were the ones you mentioned.

However, the extreme price rises lately have made gains virtually impossible on any property in any location. I would sit it out for a while and just keep scouring.

Auctions have no bargains. Agents have no bargains. Advertising won't work, neither will shoving a thousand leaflets through letterboxes in Crookes.

In all honesty, I would take a week off work, sit in front of the getting out of jail because of the (previously) rising market on all those programs like property ladder, etc.

It might save you a fortune, and your marriage!

Sorry to be so disparaging, but these telly programs and articles in Sunday supplements have given lots of false hope that there is a killing to be made, when what really happens is that people lose thousands.

They call it 'development' when in reality it is a tart up job.



If you want to make money in residential property...

My tip... buy the cheapest house on the street, move into it, put in a new (but the cheapest) B&Q kitchen and bathroom, give it a lick of paint, tidy the garden, then put it on the market and sell it fast for a modest profit.

If you can live like a gypsy for a few years you can make a tidy tax free lump sum once or twice a year.

Don't give up the day job though.

Thanks Tony, i feel really confident now!

Have you any experience of developing? (sorry, I mean tarting up!)

I still think there is potential in any market providing you buy at the right price.

My thoughts are that anyone refurbing / developing at the moment will never give information away that may be profitable for themselves!!

Please don't be so cynical ceevee.

I make my living at the big stuff, not individual houses, so I personally have nothing to lose or gain, I'm just trying to be helpful.

Marmaduke, I'm trying to be quite objective to help you. I quite often help others out without expecting nothing in return. I make quite a good living without tripping others up.

I do know how difficult it is at the moment in all parts of the market, and the value gaps in the small stuff are virtually non-existent. There are a hundred or more people like you in Sheffield alone, so you can see that the competition is strong and prices are very very high.

Most people have had a good time in the last 2/3 years simply because of the rising market, not because they have done anything clever. To reuse one of my favourite phrases, they got out of jail without even knowing they were in it!

That time has gone for the moment. Therefore, you have to be clever! The tip I gave you originally is a good one. It is a tax free one too!

Getting a builder, plumber, electrician to turn up is almost impossible, and then the prices will astound you! By keeping it simple and doing work yourself on evenings and weekend you will save a lot of money. A kitchen will cost around £1250 to buy and the labour is free. At the moment Arnold Laver charge £2,500 to fit kitchens! You can buy a simple white pot bathroom suite for less than £200. A plumber will want around £750 to fit it.

If the property isn't your 'primary residence' for at least 6 months then the tax man will take 40% of your profit each year. If you have any that is.

When I do appraisals on large projects I always mentally expect costs to be 20% more, and gross profits to be 50% of what the appraisal actually predicts. That's before interest and bank charges and taxes.

I personally think that the suggestion I made is quite a cute one if you are prepared to do it. I'd do it myself!

Better to have your eyes open don't you say?

Fair point Tony. I wasn't trying to be overly negative, just maybe realistic at the level we're talking about.

Everyone and his dog seem to be looking for bargains. The 'We buy houses for cash' brigade seem to be out in full force.

The boarded up houses you see around all seem to have an owner quite content to leave them in that state, and even if they do want to sell, seem to think they can get full market value!
Nevertheless Marmaduke, keep looking and one day you WILL get something! Good luck...

I have to agree with you.

They are out there. but it is so tempting to just go out and buy something through impatience.

Property, like all things is a specialist and professional business,and anyone that enters it should be aware of at least some of the pitfalls.

Think of it this way...

... would you go out and call yourself a doctor?

Of course not, so why should you go out and call yourself a property developer? It is a professional business with huge amounts of money at stake.

Good luck, but be careful. If I can help in any way, just drop me a PM. The one thing that I have never done is to tread on others toes simply because I don't need to. Don't get carried away,and be careful of auctions :) There are deals for all if you know what you are doing, and are careful. I is possible to make money, but equally, you can also lose a huge amount too.